Tag: Canada

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Canada Wants To Know What You Think About Home Cultivation

Written by Johnny Green on March 24, 2021. Posted in Medical.

Canada is an international leader when it comes to cannabis policy, and that was true prior to the country becoming the first G-7 nation to legalize cannabis for adult use.

Canada’s top court ruled that medical cannabis was a constitutional right back in 2000, and a year later lawmakers in Canada passed legislation implementing the ruling into public policy.

Since that time patients have been allowed to cultivate medical cannabis at home, however, Canada is now looking to tighten up medical cannabis home cultivation rules and has launched a ‘consultation on guidance on personal production of cannabis for medical purposes.’

The consultation, which can be found at this link here, opened on March 8th and goes through May 7th and is open to:

All interested Canadians, including Indigenous Peoples
Patients and patient associations
Provincial, territorial, and local governments
Cannabis industry licence holders and associations
Law enforcement and first responders and associations
Health care practitioners and health care practitioner regulatory bodies and associations

The goal of the consultation is to craft criteria that can be used for refusing or revoking a medical cannabis cultivation registration to help combat unregulated cannabis sales.

Canada has a robust legal framework in which people can cultivate cannabis and sell it legally, however, the unregulated market still exists post-legalization.

Rather than putting resources and effort into taking away the rights of patients to cultivate medical cannabis, Canada’s government should be dedicating those same resources to improving the current legal framework in a way that makes the regulated market more competitive with the unregulated market.

Canada’s lawmakers and industry regulators need to figure out how to create a business environment in which the price for cannabis flower and other cannabis products are closer to unregulated prices.

The main reason that consumers point to as to why they still purchase unregulated cannabis in Canada is that regulated cannabis costs too much. If legal options were more affordable, presumably more customers would make legal purchases instead of purchasing unregulated cannabis.

With that being said, the unregulated market for cannabis will always exist to some extent, just as it does for cigarettes and alcohol, which is a fact that seems to often be missed by lawmakers bent on clinging to failed prohibition policies.

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Legal Cannabis Sales Outpace Unregulated Sales In Canada For The First Time

Written by Johnny Green on August 31, 2020. Posted in Business.

Legal adult-use cannabis sales started in Canada in 2018. Canada is only one of two countries where adult-use cannabis sales are legal, with the other one being Uruguay.

However, unlike Uruguay which limits sales to residents, Canada allows legal sales to all adults regardless of residence status. In so many ways Canada is the largest cannabis policy and industry experiment on earth.

Transitioning sales from unregulated sources to legal ones has been a turbulent process in Canada, which is not entirely unexpected. After all, Canada is the first nation to ever embark on such a massive cannabis industry undertaking, so setbacks were expected.

Since the launch of legal adult-use sales, Canada’s government has struggled to combat unregulated purchases, with the unregulated market receiving a larger share of sales compared to the regulated market. However, that changed recently with Canada recording its first quarter in which legal cannabis sales outpaced unregulated sales. Per Bloomberg:

Canadian household spending on legal cannabis in the second quarter of the year outpaced the illicit market for the first time, marking a significant milestone for the licensed pot industry.

Statistics Canada said Friday that Canadian household spending on recreational cannabis reached $648 million in the second quarter of 2020, an increase of 74 per cent from the same period last year. Meanwhile, spending on medical cannabis was flat at $155 million in the second quarter, StatsCan said.

Canadian household spending on illicit cannabis fell to a new low of $784 million in the second quarter, StatsCan added. Taken together, the legal cannabis market now accounts for 50.5 per cent of all pot-related spending in Canada.

This is a significant milestone for not only Canada but also for the rest of the world. All ‘cannabis policy eyes’ from around the world have been locked on Canada to see how things are unfolding.

The situation in Canada is far from perfect, however, the fact that the legal market is now seriously competing with the unregulated market is very significant. It’s a meaningful sign that legalization is working in Canada, and if Canada can do it presumably other nations around the globe can do it too.

Canadian Retailers Sold A Record Amount Of Adult-Use Cannabis In June

Written by Johnny Green on August 26, 2020. Posted in Business.

Canada is the undeniable international cannabis leader right now. The North American nation had a well-established cannabis industry prior to legalization, and when Canada legalized cannabis for adult-use it became only one of two countries to do so.

Uruguay is the only other country on the planet that has legalized cannabis for adult use, and unlike Canada, Uruguay does not allow non-residents to purchase cannabis.

Cannabis can be acquired through not-so-legal methods in every country on earth, but Canada is the only country where any legal-aged adult can make a legal purchase of cannabis flower and other cannabis products without any medical prescription or certification.

Canada’s adult-use law is not perfect, and the legal industry still struggles to keep up with the unregulated industry, however, that’s not to say that the legal industry isn’t getting stronger, as proven by June sales numbers from Statistics Canada.

Per sales data from Statistics Canadian, legal adult-use retailers sold over 201 million Canadian dollars worth of cannabis flower and other cannabis products in June. That is a nearly 8 percent increase over the previous monthly record which was set just in May 2020, the month prior.

Until another country legalized cannabis for adult use in a way that is as open as Canada, the country will presumably remain a top tourist destination for cannabis enthusiasts around the world, which should lead to increased sales numbers for the foreseeable future.

That is in addition to domestic customer demand continuing to shift from the unregulated market to the legal market, as well as international sales since Canada is a top global exporter of medical cannabis.

Canada Grants Only 257 Cannabis Pardons In Program’s First Year

Written by Johnny Green on August 11, 2020. Posted in Politics.

A cannabis offense on a person’s record can literally ruin their life. When someone is arrested and convicted of a cannabis offense, the initial punishment is the fine and/or incarceration. However, the punishment continues well after the offender has served their ‘debt to society.’

Cannabis offenders are essentially branded with the ‘cannabis scarlet letter’ and they carry it for as long as the offense pops up on background checks, which can prove to be the case for decades after the offense.

A cannabis offense on a record can result in someone being turned down for a job that they are otherwise qualified for. It can prevent people from receiving government assistance, including financial aid for college. People can lose out on housing opportunities and can even be prevented from volunteering for various organizations and causes.

No one should have to live like that – not for possessing a plant that is 114 times safer than alcohol. Canada, which legalized cannabis for adult use in 2018, launched a program roughly a year ago that was geared towards helping folks get cannabis offenses removed from their records. Unfortunately, it appears that the program has not helped enough people. Per CBC:

It has been one year since the government launched a program offering Canadians with a criminal record for simple pot possession a fast, free pardon — but only 257 people have been granted one so far.

Critics say the low number proves the program is “unconscionable” and a “total failure.” They’re calling on the government to deliver an automatic removal of those criminal records.

According to figures provided by the Parole Board of Canada (PBC), 458 people have applied to the program. Of those, 259 were accepted for consideration, with 257 granted and two discontinued. Another 194 applications were returned because the person was ineligible or the file was incomplete, while five more are still in the works.

It should be a standard feature of any legalization measure going forward, regardless of the country or jurisdiction, that past cannabis convictions get automatically expunged and the records sealed.

It makes zero sense for someone to continue to be punished, no matter how major or minor the punishment is, after the binding law is changed.

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Canada Now Has More Than 1,000 Legal Recreational Cannabis Dispensaries

Written by Marguerite Arnold on July 29, 2020. Posted in Business.

It is official. Canada now has more than 1,000 dispensaries. The last official count as of mid-July was actually 1010.

This is a stunning development in a country that, as of the first year of recreational legalization decided that only the government would be in the dispensary business.

How things have changed in just the last 18 months.

Further, it is also expected that the number of dispensaries is set to grow sharply, given the number of applications in the pipeline.

Where the dispensaries are opening to date is another matter. Openings are still highly uneven. The provinces with the most amount of dispensaries to date are Alberta and British Columbia, like the U.S., on the west coast. Ontario, the headquarters of the largest public companies, lags behind, in large part because of politics, and because of course, the original scrapped plans to mandate government-owned outlets for the recreational market.

Why Does This Matter?

One of the most intriguing stories out of the Canadian market is how effective mom and pops have been in staying the course, in part because patients have the right to grow their own (even if they have to obtain a license to do so). The larger companies are facing a huge backlash, in other words, from regional growers who want to grow and sell locally.

While the big public companies are absolutely investing in next-gen canna products, there is still a lively cultivation and distribution market afoot beyond them, and further one that is regulated first by the federal government and then, in the details, by the Canadian “states.” Just like the United States and certain countries in Europe could and probably also will be within the next five years.

Market Vs. Cannabinoid Forces

One of the stranger aspects of the plant is that in the process of legalization, certainly widely held “truths” about the market inevitably fall to the wayside. The first, as seen plainly in the Canadian dispensary conversation, is that the government cannot “control,” it. Patients and recreational users alike will find ways to get access to this plant, and in ways that continue to democratize the conversation.

And while there are still conversations of “one cannabis company to rule them all,” these have gotten decidedly lower in volume as the reality of meeting market demand if not regulatory muster has kicked in for those on the front end of this discussion.

Bottom line? While there will inevitably, just like the German distribution market, be consolidations and pivots, the cannabis market in Canada is opening, finally, for full and unfettered access to go along with all that reform.

The International Cannabis Business Conference will be resuming its international conference schedule as of 2021. In the meantime, stay tuned to this blog and sign up for our newsletter.

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Where Goes The Canadian-German Export Market?

Written by Marguerite Arnold on June 18, 2020. Posted in Business.

For the past several years (since 2016), Canadian exporters have sent ever-larger amounts of medical cannabis to Germany. The amount grew from a mere 44 kilograms to 3,740 by the end of last year according to Health Canada.

But will this exponential growth continue?

The answer is largely no, and for a variety of market-driven reasons although savvy Canadian exporters should be paying especially close attention now:

German grown cannabis is coming (finally), with a few bumps and hitches, and expected to be here by the end of 2020. While this will not be nearly enough to meet the growing demand here, it will clearly put a damper in Canadian sales especially because:
The Dutch government is getting more efficient with cannabis distribution – namely, it is beginning to limit the number of distributors it will work with. This downward pressure on the market in terms of the competition will also create German distributors in desperate search of product, but that is another issue.
As popular as Germany has been as a destination (on the medical market), there are no other countries which regularly import as much Canadian product as Germany.
There are other factors which will now impact the medical market, namely the growth of legitimate cannabis cultivations around Europe and the entry of Israel into the cannabis market globally.

One thing is for sure. The market will never “be the same” as it was in 2016 and 2017. That period has morphed into one where deep-pocketed cannabis companies approach the entire proposition as a medical product. That is a world, so far (major pharma) that the Canadian market with a few major exceptions has not jumped into, namely because there is so far little need to for domestic sales. The market there may be driven by medical sales, but the recreational question changed the entire conversation.

Here, while that may also happen too, as the next decade countries all over Europe will be grappling (as Israel is currently) with the recreational question, it will almost certainly happen more slowly.

However the change will not be fast enough to save many of the newer, exclusively cannabis focussed wholesalers unless they develop tactics that take them outside of just Germany, or perhaps beyond this one drug.

The distributor market, in other words, is about to go through a series of mergers and buyouts just as the first German cultivated product hits the shelves. Canadian producers who are smart and savvy would do well to look for hungry distributors no longer getting products from across the Dutch border.

Find out more about trends on the ground in Europe’s largest cannabis market when the International Cannabis Business Conference returns to Europe this fall.

Veterans Affairs Canada Spent More On Medical Cannabis Than Any Other Medication In 2019

Written by Johnny Green on May 27, 2020. Posted in Medical.

Many military veterans all around the world suffer from one or more health conditions, often related to their years serving their countries. Canada is no exception.

The range of conditions is wide, with military veterans in Canada suffering from all types of ailments including chronic pain, poor mental health, and various diseases. Some military veterans retired from service perfectly healthy, but age-related ailments began as the veterans became older.

Military veterans in Canada have been prescribed all types of medicines, with some being safer than others.

One medicine that has proven to be safe and effective is cannabis, and fortunately for the health of Canadian military veterans, Veterans Affairs in Canada spent an enormous amount of money in 2019 making sure that veterans had enough cannabis.

In fact, more was spent on medical cannabis than any other medication. Per Salt Wire:

The Department of Veterans Affairs spent $77,794,212.57 last year on marijuana.

That is more than the department spent ($66.2 million) on the 12,000 other drugs approved to be prescribed for veterans.

It’s inspiring to see Canada’s government stepping up in this way. It would be fantastic to see every other government take such a compassionate approach, including and especially the United States government, which continues to block even basic attempts to improve safe access to cannabis for military veterans.

Canada’s Cannabis Industry Lobbies For Economic Aid Due To Virus Fallout

Written by Johnny Green on March 24, 2020. Posted in Business.

The coronavirus is wreaking havoc on the global economy, and the cannabis industry is no exception. Some states in the U.S. have designated the cannabis industry to be ‘essential’ however, that is more of the exception than it is the rule.

Economic stimulus packages are being proposed all over the world, including in Canada, to help industries weather the storm. Members of the cannabis industry in Canada are lobbying to be part of any national aid package. Per Bloomberg:

Canada’s cannabis industry is lobbying the government to be included in Ottawa’s $82-billion economic aid package for businesses impacted by the COVID-19 pandemic.

More than 70 cannabis industry professionals, ranging from producers to retailers to consultants, signed a letter sent to Industry Minister Navdeep Bains and Finance Minister Bill Morneau requesting the government provide the legal pot sector “immediate measures to receive economic stimulus.”

“Canada’s cannabis industry has weathered several shocks in the past six months, including the loss of over 2,000 well-paying jobs in the sector. Our access to capital, including credit, is challenging,” according to the letter obtained by BNN Bloomberg.

Access to capital is particularly problematic for cannabis businesses, and not just in Canada. Investment money was flooding into the industry for a time, however, that has changed recently. Reliable access to credit has always been an issue for the cannabis industry. If the cannabis industry is to survive in Canada, it will likely need some help in doing so.

A similar effort is underway in the United States where members of the cannabis industry are lobbying lawmakers to include the cannabis industry in any future stimulus packages.

Some cannabis companies continue to do well in the U.S. despite the economic issues caused by the virus response, however, there are plenty of others that are struggling, and even those that are continuing to succeed may be unable to continue to do so because of all of the uncertainty surrounding the larger economy.

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More Canadian LPs Obtain EU GMP Licenses

Written by Marguerite Arnold on March 16, 2020. Posted in Business.

Several more Canadian firms have obtained EU-GMP licenses over the last month, with Aphria obtaining its license at the end of January, about a year later than expected.

Indeed, GMP certification proved to be a major, expensive and time-consuming hurdle for many Canadian firms, and it has taken a great deal longer to obtain the same than most anticipated. Clearly other issues, including the continued delays on the cultivation bid, have added to the discussion.

However, EU GMP is not the only license required to enter the European market as Aurora learned last fall.

Regardless, what this clearly shows is that Canadian firms are not shying away from the challenge and there will be more floss heading this way soon.

What Is EU GMP?

EU GMP certification is the medical certification required of all medical cannabis entering the market in Germany and across Europe. There is a range of requirements, including labeling that goes along with this.

The certification is not unique to the cannabis industry but rather a pharmaceutical standard that is used globally.

Do Any US Firms Have EU GMP?

GMP certification has not taken root, yet, widely in the United States because of the lack of federal reform and still state-level industry regulations. That said, it is unlikely that this development will skip the United States as the industry finally goes federal, presumably sometime after the next presidential election.

How Do You Start To Get Certified?

The most important step in becoming certified for this kind of market is starting correctly. That means everything from growing organic to construction facilities.

How Do You Justify This Expense To Your Investors?

So far, the idea of raising capital to build facilities to GMP standards has not been a priority in the U.S. However, as the market matures and evolves, this standard will increasingly be in the room. Indeed investors will increasingly ask to see proof or at least plans to get this kind of certification in business plans and prospectuses.

To learn more about certification and other required regulations in the German market, be sure to attend the International Cannabis Business Conference in Berlin this July!