A third passenger, Kendall Harper, 16, was severely injured in the crash on State Street in the northwestern Montgomery County borough.
Police also announced the arrest of Rafie Ali, 34, of East High Street, and Mohamed Himed, 25, of New York City.
Ali, authorities allege, was proprietor of the store where Malloy bought the K2, and Himed was a clerk. The pair were charged with corrupt organizations, delivering a controlled substance, and possession of drug paraphernalia.
According to court papers, the two peddled the illegal substance for $5 a bag or vial from behind the counter of Achi, a convenience shop at 315 E. High St.
They were not charged with vehicular homicide because the anti-synthetic drug legislation passed last Aug. 22 has no provision for that.
"But make no mistake," said District Attorney Risa Vetri Ferman, "they do have blood on their hands."
The two men were arraigned late Monday before District Judge Edward C. Kropp Sr., who ordered each held on $1 million bail in the Montgomery County prison. Malloy, in prison since his arrest, awaited arraignment late Monday before Kropp.
Ferman portrayed the case as a cautionary tale about what can go wrong when young people use synthetic marijuana. Also known as "spice," K2, and "fake weed," it is a man-made chemical compound that can be sprayed on a natural herb. When smoked, it delivers a high similar to THC, the prime ingredient in marijuana.
"K2 might look like something from a candy store, but it can kill," Ferman said. Young people use it because it is less expensive than marijuana and because they think "it's not dangerous."
"It can get you into as much trouble as other illegal drugs," she warned.
Ferman said synthetic pot was unknown in the United States until 2010, when it arrived from the Mideast. Police began receiving reports of "violent and disturbing behavior" among those under the influence of K2 and pushed legislators to enact laws against it.
On June 15, 2011, an Upper Moreland boy, 16, who had just smoked K2 jumped off the third story of a parking garage in Abington Township and was severely injured.
Police said the boy was sitting in a car with three friends about 8 p.m. when "he began to act oddly and may have been hallucinating."
"He suddenly ... ran full speed and leaped off of the deck," detectives said. No charges were filed because the synthetic-drug ban had yet to become law.
In the Pottstown case, the K2 "caused [Malloy's] heart to beat faster, blurred his vision, and caused a sense of panic," according to court papers.
The car skidded 443 feet before coming to rest in an alley. Malloy pulled his friends from the backseat and then vanished, police said. Malloy was apprehended May 22.
Because a firearm also was confiscated from the store, Ali could face a minimum five years in prison for selling fake pot, Ferman said. Himed could face two to five years behind bars.
Contact Bonnie L. Cook at 610-313-8232 or firstname.lastname@example.org. Read her blog, "MontCo Memo," on philly.com.