In the legal cannabis industry, your brand’s reputation is only as strong as your control over your supply chain. However, as markets expand, many licensed brands are discovering their products in places they shouldn’t be: unauthorized dispensaries, out-of-state markets, or “gray market” online listings.
This is gray market diversion, and it is a growing threat to the bottom line and regulatory standing of licensed operators. To fight back, brands are turning to advanced cannabis packaging security that stays out of sight: invisible UV barcodes, infrared taggants (IRTs), and track-and-trace labels that protect your brand, product, and consumers.
What Gray Market Diversion Looks Like in Cannabis
Gray market diversion occurs when authentic products are diverted from their intended, legal distribution channels into unauthorized markets. Unlike “black market” counterfeiting—where someone fakes your product entirely—the gray market involves your actual product being sold where it shouldn’t be.
This creates three major risks for cannabis leaders:
- Regulatory Risk: State-level track-and-trace cannabis labels are mandatory. If your products are found in unauthorized jurisdictions, you could face hefty fines or license suspension.
- Brand Damage: Consumers who purchase diverted products may receive expired or improperly stored goods, resulting in a poor experience, or even serious health concerns, that they associate with your brand’s reputation.
- Revenue Loss: Diverted products often undercut your authorized retail partners, damaging your professional relationships and price integrity.
Covert features like invisible UV barcodes and infrared taggants give brands an additional, non-obvious way to link every unit back to its intended channel, making diversion investigations faster and more defensible.
How Invisible Barcodes Work on Cannabis Labels
The most effective way to catch diversion is to mark your packaging with information that only you (and your authorized partners) can see. Invisible barcodes are printed using specialized UV fluorescent pigments.
To the naked eye, the packaging looks exactly as the designer intended. However, when placed under a specific wavelength of UV light, a hidden barcode or data matrix appears. These codes can then be scanned to reveal the product’s unique identity, batch number, or intended destination.
Angstrom’s technology also supports combining invisible barcodes with covert infrared taggants, creating marks that respond differently under UV and IR illumination for higher security and more granular authentication workflows
By using covert security, brands can:
- Maintain Aesthetic: High-end cannabis branding remains clean and uninterrupted.
- Authenticate Instantly: Field inspectors or internal QA teams can verify a product in seconds with a simple UV light or IR-enabled detector, depending on the security feature.
- Stay One Step Ahead: Diverters often “clean” visible serial numbers off packaging. They can’t remove what they can’t see.
Track-and-Trace Labels for Diversion Control
Integrating invisible UV barcodes into your track-and-trace cannabis labels transforms a passive package into an active security tool. This creates a “layered security” approach where visible regulatory marks work alongside hidden authentication marks.
When these hidden codes are linked to a central database, your brand gains total supply chain traceability. If a SKU turns up at an unauthorized pop-up event, a quick scan of the invisible barcode can tell you exactly which distributor or dispensary originally received that specific unit. This allows for data-driven investigations and immediate corrective action.
Implementation Best Practices for Cannabis Track-and-Trace Labels
Adding invisible security to your packaging doesn’t have to be a technical hurdle. Here is how to get started:
- Consult Your Label Converter: Work with a printer who understands UV fluorescent pigments and, when needed, IR taggants, and can ensure the ink and taggant chemistry are compatible with your label substrate and press process.
- Strategic Placement: Hide codes within existing design elements, such as inside a logo or as part of a background pattern, to make them even harder for unauthorized parties to locate.
- Equip Your Team: Provide your field reps and compliance officers with high-quality UV flashlights, specialized UV barcode scanners, or IR-capable detectors matched to your taggant’s response.
- Layer Your Defense: Combine invisible barcodes with other authentication features, like tamper-evident seals, color-shifting inks, and covert IR taggants for a robust, multi-level security posture.
How Angstrom Technologies Inc. Supports Your Brand
At Angstrom Technologies, Inc., we specialize in the science of the unseen. We provide the advanced fluorescent pigments for invisible UV barcodes and covert IRTs that allow cannabis brands to secure their supply chains without compromising their brand identity.
Our solutions are designed to be a consultative fit for your existing operations. Whether you are looking to enhance your cannabis packaging security with invisible UV barcodes, add IR taggants for higher security, or need a custom track-and-trace solution to stop diversion in its tracks, we provide the tools to ensure your product stays exactly where it belongs.
Track-and-Trace Labels for the Cannabis Industry FAQs
No. When formulated correctly, these marks remain completely invisible under standard lighting, preserving your brand’s visual appeal. The same is true for properly engineered infrared taggants, which are designed to remain unseen unless interrogated with the correct IR wavelength and detector.
Generally, no. These pigments are designed to be integrated into standard printing processes (flexographic, digital, or offset) used by your label converter. IR taggants can also be incorporated into inks, coatings, or label materials with minimal process changes when properly specified with your converter and security partner
Yes. While systems like Metrc track products for the state, invisible barcodes are a brand-driven security layer used for private authentication and diversion protection. IR taggants and UV features can complement state tags by providing covert brand-controlled verification that remains effective even if visible labels are removed, copied, or obscured.
Ready to secure your supply chain? Reach out to Angstrom Technologies Inc. to discuss how our invisible security solutions can protect your cannabis brand from gray market diversion and fraud.