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Why are illegal drugs so cheap in San Francisco?

A person holding tin foil with drugs inside
A man holds a piece of foil containing fentanyl on McAllister Street in the Tenderloin district of San Francisco. | Jessica Christian/San Francisco Chronicle via Getty Images | Source: Jessica Christian/SF Chronicle/Getty Images
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It’s a claim made by a former U.S. Attorney, countless ordinary San Franciscans and, most recently, a CNN special report focused on San Francisco: Illegal drugs are cheaper here than elsewhere.

But unlike many of the alarming things you regularly hear about San Francisco, this one isn’t a myth or an exaggeration.

The Standard asked three experts about drug prices in the city and particularly about prices in the Tenderloin, a neighborhood that has become synonymous with drug-dealing, addiction and homelessness. All agreed that drug prices here are low.

But there were a few caveats.

First, not everyone felt comfortable saying San Francisco had the lowest prices.

Second, drugs aren’t sold like stocks on the Nasdaq or cryptocurrency on Binance: Their going price isn’t publicly listed, and there are many factors that influence it. That makes it difficult to draw ironclad conclusions about the prices.

Nonetheless, the experts agreed that a combination of San Francisco’s proximity to the United States’ southern border, from where drugs are often smuggled; the amount of supply; and the city’s policy of not aggressively policing illegal drug use all exert a downward pressure on prices.

Brian M. Clark leads the Drug Enforcement Administration’s San Francisco Field Division. He said San Francisco prices are not necessarily lower than elsewhere throughout his division, which stretches from California’s northern border down to Bakersfield.

“However, drugs are so widely available in the open-air drug market that the price of fentanyl and other drugs can be lower,” he said.

In the Tenderloin, a gram of the highly addictive synthetic opiate fentanyl can go for anywhere from $20 to $40. According to data from the High Intensity Drug Trafficking Areas program, a gram of fentanyl costs between $40 and $100 in Los Angeles, he said.

That suggests the San Francisco price may be lower. But, again, there’s a caveat: It depends on the drug and the local situation.

“In the Central Valley, we predominantly see a lot of methamphetamines,” Clark said. “So methamphetamine in the Central Valley area is a lot cheaper than methamphetamine in San Francisco.”

Drugs are also generally less expensive across California than elsewhere because, alongside Arizona, it is a “source state” to the rest of the country.

Thomas Ostly served as the assistant district attorney of San Francisco from 2013 to 2020. During that time, he also always believed that San Francisco drug prices were lower than elsewhere. 

“My understanding was that it was because the drugs were more available,” he said. “And not only were they available, they were also being cut with fentanyl, which is cheaper than the drug that it’s being sold as.”

With limited police action against drugs, the dealers aren’t losing much of their supply to enforcement, something that could drive prices higher, Ostly said.

Tom Wolf knows the issue of drug availability and pricing from two sides. A former heroin addict, he spent six months living on the streets of the Tenderloin in 2018. After getting clean, he now advocates for recovery from addiction.

He believes that the sheer supply of fentanyl here is not simply driving down prices but also changing the market for drugs.

“In San Francisco, we’ve kind of come across this unique situation now, where we have so much supply of fentanyl that it is now driving demand itself,” he said. “Because there’s so much of it and it’s so cheap that people are purposefully seeking it out as opposed to other drugs.”

All the experts agreed on one thing: Fentanyl, which has proliferated throughout America over the last decade, is a game changer.

Instead of farming and harvesting opium poppies and then converting them to heroin, the drug cartels can just combine three precursor chemicals in a clandestine lab.

“It’s really lowered the overhead for those who manufacture illicit drugs,” Wolf said. 

Clark of the Drug Enforcement Administration put it more bluntly. 

“Fentanyl is, without a doubt, the deadliest drug threat that our country has ever faced,” he said. “It’s cheap, it’s highly addictive and it’s a very powerful poison.”