Tag Archives: UK

November 14, 2019

NHS Finally Approves A Few Cannabis-Based Medicines for England & Wales

By Marguerite Arnold

You have to hand it to the Brits right now. There is nothing that seems to be working in a land caught in the gray zone of “Brexit or Not.”

That absolutely can be said for cannabis prescriptions and the subsequent availability of the drug, via the National Health Service (NHS). For all the hand-wringing and drama so far, it has only taken a year between possibility and execution. That said if Brexit were that “fast” who knows what might have already happened to the NHS to begin with?

Regardless of the many deservedly snarky comments in the room (from both the British and elsewhere point of view), here are the basics:

Cannabis-based medicine will be available only to treat two relatively rare forms of childhood epilepsy, Multiple Sclerosis, or chemo-induced nausea caused by cancer treatment. The drug can also only be prescribed by specialist doctors (not GPs).

Who says the NHS and the National Institute for Health and Care Excellence (or NICE for short) doesn’t move quickly?

Perhaps they should have attended the 10th biannual IACM conference in Berlin at the beginning of the month. There were certainly reform-minded Brits who did.

What Were They Thinking?

When reading the recommendations from NICE, it is hard to imagine how a medical policy body could get most of the cannabis discussion so wrong. While it is nice to know that dying children seem to be highly effective in setting drug policy in the UK, that is hardly comforting to the potentially millions of adult Brits who have absolutely been left out, this time.

This begs the question why an adult in chronic pain or suffering muscular spasticity of a kind not caused by MS (much less adult epileptics) is somehow in a different basket of care? Indeed, the idea of recommending against the use of THC specifically for chronic pain is, at this point, a sign of at minimum gross inability to read even recent medical studies from just about everywhere, not to mention patient evidence and testimony. Those adults who managed to get coverage, at least so far, will be given the right to continue treatment until their doctor decides otherwise. Not a very comforting place to be.

Here Comes The Gray And Black Market

All this will do of course, is push those who do not qualify for NHS coverage into either the private market (if they can afford it), or more likely, the existing gray and black market. The former of which of course, is, like other places, underground.

And while GW Pharmaceuticals has everything to cheer about, the rest of the established industry, at this point, surely should be ready to take a concerted stand.

The ridiculous posture of the NHS beyond that on cannabis in this day and age is hard to understand. Even the Germans are ahead of them. And Deutschland is hardly a country where the use of cannabis is anything like mainstream yet.

But then, welcome again, to the wacky world of cannabis reform where it is possible to take one step forward and then many back.

Is This The Face Of The British Conversation Post Brexit?

If there were a single conversation to unite a country right now, the medical coverage of cannabis for the country’s poorest and sickest might be it.

Unfortunately, this does not appear to be a conversation that will progress in the UK until it moves in the United States. Federal reform in America would of course open the doors, and immediately, to a state-like “recreational” market, where, theoretically, patients could buy any kind of cannabis they want.

Just like Colorado. Or California.

But here is the rub. In the United States, federal reform has not come yet. And even then, what health insurers decide to cover or not, and for what condition, is a topic many Brits have never had to really contemplate. And certainly not when it comes to cannabis. This new decision by the health authorities might just be a terrifying glimpse of what is yet on the agenda if and when Britain “divorces” the continent.

Is The Dream Of Medical Coverage For Cannabis Just That?

Here is the good news. Cannabis always makes progress, no matter how long the slog has been. If the Brits are determined to sit this one out while their citizens suffer, the conversation is still alive, if struggling, elsewhere. Notably Germany. And Israel.

These are, to date, the only two countries who have jumped in, seriously, on the issue of insurance coverage of cannabis, and for a broad range of conditions, although even here in both countries, there are still issues and controversies galore.

The terrible reality in the room however, is clearly writ large for all those who are brave enough to grasp it. Most patients are going to be on the hook for the cost of their medical cannabis for a long time to come.

October 30, 2019

The Economics of Ex-Im In Europe

By Marguerite Arnold

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You have read the press releases. You may have heard about such ideas at a recent cannabis conference in and around the EU of late. Or you may have encountered new distributors coming into the game with a German presence and a decidedly interesting ex-im plan that sounds a bit, well, off the map.

No matter how geographically creative some of these plans are, the problem is that many of these ideas literally do not make economic sense. Either for the companies themselves (if not their investors), and certainly not for patients. Not to mention, truth be told, the looming price sensitivity issues in the European market that North Americans, for starters, seem to still just be waking up to.

Some Recent Examples….

Yes, exports from Denmark have been much in the news lately (including into both Germany and Poland). Truth be told, however, this makes about as much sense, economically, as importing ice to eskimos. Why? Denmark, for all its looser regulations and less-uptight approach to the cannabis discussion generally, is one of the most expensive labour markets in Europe. Fully automated production plants are one thing, but you can build those in other places too. Especially warmer climates, with lots of sunshine. German production, as it comes online, will also make this idea increasingly ludicrous.

Who on earth got on this bandwagon? It seems that the enthusiasm in the room began when Denmark began to import to Germany (where the disparities in wages in production are not so noticeable). However, lately, several Canadian companies with a Danish footprint have been eying Poland of late.

And on that particular topic – there are many who are doing the math and trying to figure out, as the alternatives get going, if even Canada makes much sense, or will in a few years.

Low Wage Markets With Sunshine Are Hotspots For European Cannabis Production

Like it or not, the European market is extraordinarily price sensitive – namely because it is not “just” consumers called patients picking up the tab but health insurance companies demanding proof of medical efficacy.

That starts, a bit unfortunately, with understanding wage economics across Europe. The warmer the climate, in other words and the further east on the map, wages drop precipitously. That is “good” for an industry looking to produce ever cheaper (but more compliant) product.

It is also good, at least politically, for countries whose elected leaders are being forced to admit that cannabis works, but are less than copacetic about encouraging local production. See Germany for starters, but places like Austria, Poland and most recently France (which has just embarked on a first of its kind medical cannabis trial).

Here, no matter the temporary buzz about Denmark, are the places that cannabis production makes sense:

Portugal: The country is a newcomer in the cannabis discussion this fall, although in truth, the seeds of this reality were sown several seasons ago when Tilray began to build its production plant in the country in 2017. They are far from the only company who has seen the light, and these days, farmers are getting hip to the possibilities. Especially if they are already exporting crops throughout Europe.

Spain: The industry that can afford GMP certification is getting going, but everyone else is stuck in a limbo between pharmaceutical producers and the strange gray market (see the patient clubs in Barcelona). That said, political groups are beginning to discuss cultivation as an economic development tool, if not sustainable food and medication strategies.

Greece: The weather is warm, and the investment climate welcoming. Of all the countries in the EU, Greece has embraced the economic possibilities that cannabis could bring. How that will play out in the next years to come is an intriguing story.

Italy: The southern part of the country in particular is ripe for cannabis investment and it’s full of sunshine. However, as many have noted, organized crime in this part of the world is a bit fierce and starts with the letter M.

Malta: The island is a comer, but does importing cannabis from here really make economic sense? There are trade routes and economic treaties tying the island both to the apparently Brexiting British and Europe. Why not, right? Just remember that along with labour, transportation costs are in the room here too.

And Just Outside The EU…

The country now (sort of) known as North Macedonia and struggling to get into the EU if France would just get out of the way is also going to be a heavyweight in this discussion for years to come. Wages, of course, will increase as part of EU membership, but in general, this country just north of Greece is going to play a highly strategic role in exports throughout Europe.

September 10, 2019

Does Germany Have a Gray Market Problem?

By Marguerite Arnold

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Tilray just did something very interesting. In addition to announcing that it was shipping product to German distributor Cannamedical via its Portuguese facility, it also announced that it had begun outdoor cultivation.

Groovy.

Even more intriguing: the company is claiming that somehow, via its proprietary technology (apparently), this kind of crop will be legit for distribution within the EU medical system.

There is only one problem with this. Outdoor growing does not sound remotely GMP-certified.

Here is the next bit of exciting news. Tilray, apparently, is not the only large Canadian cannabis company now operating in Europe that appears to be trying to get around GMP certifications for medical market penetration. Or appear oblivious to the distinctions in the international (and certainly European market).

And things are a bit smelly on that front, not only in Denmark post CannTrust, but in truth even in Germany, the supposed “Fort Knox” of regulatory consumer and pharmaceutical standards.

In fact, at least according to insiders, there is apparently quite a bit of gray market product sloshing around in the Teutonic medical market. Even though so far, at least not publicly punished for the same, nobody has been caught. Or at least publically reprimanded.

And who is on the hot seat at least according to most of the licensed if not just pre-licensed indie producers and distributors who were contacted for this story? Sure, there are dark horse “start-up” indie violators, but they are not the only problem. Many who talked to CIJ named big public Canadian companies too. And potentially Bedrocan beyond that.

Who Is Who And What Is What?

Part of the problem, beyond any kind of deliberate flouting of regulations on the part of many companies who are at least trying to understand them, is that global standards are different. “GMP certifications” of every country, even within a region like Europe, are in fact, not uniform. That is why, for example, the new EU-US MRA agreement had to be signed first regionally and then on a state-by-state level across the EU.

Beyond Germany of course, there are other problems that are coming to the fore.In the medical cannabis space, in particular, right now, that is causing problems simply because many with pharma experience are not hip to the many risks in the cannabis industry itself. On the Canadian, Australian and American side, there is also a lot of bad advice, in particular, coming from consultants who should know better.

To be properly EU and German GMP-certified, one of the required steps is to have German inspectors walk your production floor. It is also not good enough to have “pesticide-free” or national organic certification at the crop cultivation site, and add GMP cert at time of “processing.” That piece of misadvise has been showing up not only in Canada, but Australia too. And creates a nasty reality if not expensive retooling upon entering the legitimate market in Europe, for starters.

These Issues Affect Everyone In The Industry

In an environment where ex-im is the name of the game, and even the big guys are short of product, compliance is getting granular as smaller players step up to the plate – and many if not most hopeful Canadian producers (in particular) now looking to Europe for sales are not (yet) up to speed.

A big piece of the blame also lies in the lack of proper administration at the federal and state level too – even auf Deutschland. To get a distribution license, a company must actually get three licenses, although there are plenty in the market right now who begin to describe themselves as “distributors” with less than the required certs.

The lack of coordination and communication, including which certs to accept as equivalent and from where is creating a market where those who know how to game the system are.

For example, several people who contacted CIJ, claimed that uncertified product was making its way into Germany via Central and Latin America, through Canada, picking up “GMP cert” along the way. In other words, not actually GMP-certified but labelled fraudulently to make it appear that way.

The same claims were also made by those with on-the-ground industry knowledge in South Africa (Lesotho).

Beyond Germany of course, there are other problems that are coming to the fore. As CIJ recently learned, a firm authorized by the Dutch government to provide cannabis packaging, including for exports, was not GMP certified until July 2019 – meaning that all product they shipped internationally even within Europe before that date potentially has labelling issues. Cue domestic importers. If not regulators.

Grey Market Product Is Making Its Way In Through Official Channels

For those who are taking the time to actually get through the legal registration and licensing process, it is infuriating to see others who are apparently fairly flagrantly buying market position but are in no position to fulfil such obligations. It is even more infuriating for those who intend to meet the requirements of the regulations to realize that the vast amounts spent in consulting fees was actually money paid for inaccurate information.

And the only way ultimately the industry can combat that, is by standing up, as an industry, to face and address the problem.German distributors are so aware of the problem that they are starting to offer gap analysis and specific consulting services to help their import partners actually get compliant.

Government agencies also might be aware of the problems, but they have been reluctant to talk about the same. CIJ contacted both BfArM and the local Länderauthorities to ask about the outdoor grow in Portugal and the lack of GMP cert for a Dutch packager. After multiple run-arounds, including sending this reporter on a wild rabbit chase of federal and state agencies (who all directed us back to BfArm) and an implication by the press officer at BfArM that the foreign press was not used to talking to multiple sources, CIJ was redirected back to state authorities with a few more instructions on which bureau to contact. The state bureau (in Berlin) did not return comments to questions asked by email.

Here is the bottom line that CannTrust has helped expose this summer: the entire global cannabis industry is trying hard to legitimize. Not every company is shady, and there are many who are entering it now who are playing by the rules. But those who are hoping to exploit loopholes (including “name” if not “public” companies) are also clearly in the room.

And the only way ultimately the industry can combat that, is by standing up, as an industry, to face and address the problem.

Editors Note: This is a developing story. CIJ has been contacted by the Dutch Cannabis Agency as it investigates what appears to be an intra-government debate over qualification of EU-GMP cert, acceptance of audit documents and other matters within European countries that appear to have caused much of this confusion with regards to Bedrocan and its packager Fagron. Many reputable, licensed sources within the industry spoke to us on deep background, out of concern that they too would be held liable. That said, so far, nobody can explain why the only licensed Dutch packager, was issued a new EU GMP cert document on July 9, 2019, the same day that Danish authorities halted CannTrust product entering Denmark. That is a government decision. Further it is also still unclear why rival cannabis companies would attempt to contact the cannabis media with a certain (and misguided) spin on this situation.

September 4, 2019

From CannTrust To Canopy: Is There A Connection To Current Cannabis Scandals?

By Marguerite Arnold

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As Europe swooned under record-breaking heat this summer, the cannabis industry also found itself in a rather existential hot seat.

The complete meltdown at CannTrust has yet to reach a conclusion. Yes, a few jobs have been lost. However, a greater question is in the room as criminal investigatory and financial regulatory agencies on both sides of the US-Canada border (plus in Europe) are getting involved.

As events have shown, there is a great, big, green elephant in the room that is now commanding attention. Beyond CannTrust, how widespread were these problematic practices? And who so far has watched, participated, if not profited, and so far, said nothing?

Who, What, Where?

The first name in the room? Canopy Growth.

Why the immediate association? Bruce Linton, according to news reports, was fired as CEO by his board the same day, July 3, 2019, that CannTrust received its first cease and desist notice from Health Canada.

Further, there is a remarkable similarity in not only problematic practices, but timing between the two companies. This may also indicate that Canopy’s board believed that Linton’s behaviour was uncomfortably close to executive misdeeds at CannTrust. Not to mention, this was not the first scandal that Linton had been anywhere close to around acquisition time. See the Mettrum pesticide debacle, that also broke right around the time Canopy purchased the company in late 2016 as well as the purchase of MedCann GmbH in Germany.

Reorg also appears to be underway in Europe as well. As of August, Paul Steckler has been brought in as “Managing Director Europe” and is now based in Frankfurt. Given the company’s history of “co-ceo’ing” Linton out the door, is more change to come?

What Went Down At Canopy?

Last year, Canopy announced its listing on the NYSE in May. To put this in context, this was two months after the first German cultivation bid went down to legal challenge. By August 15, 2018 with a new bid in the offing, the company had closed the second of its multi-billion dollar investments from Constellation.

Bruce Linton, former CEO of Canopy Growth
Photo: Youtube, TSX

Yet by late October, after Bruce Linton skipped a public markets conference in Frankfurt where many of the leading Canadian cannabis company execs showed up to lobby Jens Spahn (the health minister of Germany) about the bid if not matters relating to the Deutsche Börse, there were two ugly rumours afoot.

Video showing dead plants at Canopy’s BC facility surfaced. Worse, according to the chatter online at least, this was the second “crop failure” at the facility in British Columbia. Even more apparently damning? This all occurred during the same time period that the second round of lawsuits against the reconstituted German cultivation bid surfaced.

Canopy in turn issued a statement that this destruction was not caused by company incompetence but rather a delay in licensing procedures from Health Canada. Despite lingering questions of course, about why a company would even start cultivation in an unlicensed space, not once but apparently twice. And further, what was the real impact of the destruction on the company’s bottom line?

Seen within the context of other events, it certainly poses an interesting question, particularly, in hindsight.

Canopy, which made the finals in the first German cultivation bid, was dropped in the second round – and further, apparently right as the news hit about the BC facility. Further, no matter the real reason behind the same, Canopy clearly had an issue with accounting for crops right as Canadian recreational reform was coming online and right as the second German cultivation bid was delayed by further legal action last fall.

Has Nobody Seen This Coming?

In this case, the answer is that many people have seen the writing on the wall for some time. At least in Germany, the response in general has been caution. To put this in true international perspective, these events occurred against a backdrop of the first increase in product over the border with Holland via a first-of-its kind agreement between the German health ministry and Dutch authorities. Followed just before the CannTrust scandal hit, with the announcement that the amount would be raised a second time.

German health authorities, at least, seem doubtful that Canadian companies can provide enough regulated product. Even by import. The Deutsche Börse has put the entire public Canadian and American cannabis sector under special watch since last summer.

Common Territories

By the turn of 2019, Canopy had announced its expansion into the UK (after entering the Danish market itself early last year) and New York state.

And of course by April, the company unveiled plans to buy Acreage in the U.S.

Yet less than two weeks later, Canopy announced not new cultivation facilities in Europe, but plans to buy Bionorica, the established German manufacturer of dronabinol – the widely despised (at least by those who have only this option) synthetic that is in fact, prescribed to two thirds of Germany’s roughly 50,000 cannabis patients.

By August 2019, right after the Canopy Acreage deal was approved by shareholders, Canopy announced it had lost just over $1 billion in the last three months.

Or, to put this in perspective, 20% of the total investment from Constellation about one year ago.

What Happened At CannTrust And How Do Events Line Up?

The current scandal is not the first at CannTrust either. In November 2017, CannTrust was warned by Health Canada for changing its process for creating cannabis oil without submitting the required paperwork. By March of last year however, the company was able to successfully list on the Toronto stock exchange.

Peter Aceto arrived at CannTrust as the new CEO on October 1 last year along with new board member John Kaken at the end of the month. Several days later the company also announced that it too, like other major cannabis companies including Canopy, was talking to “beverage companies.” It was around this time that illegal growing at CannTrust apparently commenced. Six weeks later, the company announces its intent to also list on the NYSE. Two days later, both the CEO and chair of the board were notified of the grow and chose not to stop it.

Apparently, their decision was even unchanged after the video and resulting online outrage about the same over the destroyed crops at the Canopy facility in BC surfaced online.

On May 10, just over a week after the Bioronica purchase in Germany, the first inklings of a scandal began to hit CannTrust in Canada. A whisteblower inside the company quit after sending a mass email to all employees about his concerns. Four days later, the company announced the successful completion of their next round of financing, and further that they had raised 25.5 million more than they hoped.

Six weeks later, on June 14, Health Canada received its warning about discrepancies at CannTrust. The question is, why did it take so long?

Where Does This Get Interesting?

The strange thing about the comparisons between CannTrust and Canopy, beyond similarities of specific events and failings, is of course their timing. That also seems to have been apparent at least to board members at Canopy – if not a cause for alarm amongst shareholders themselves. One week after Health Canada received its complaint about CannTrust, shareholders voted to approve the Canopy-Acreage merger, on June 21.

Yet eight days after that, as Health Canada issued an order to cease distribution to CannTrust, the Canopy board fired Bruce Linton.

One week after that, the Danish recipient of CannTrust’s product, also announced that they were halting distribution in Europe. By the end of August, Danish authorities were raising alarms about yet another problem – namely that they do not trust CannTrust’s assurances about delivery of pesticide-free product.

Is this coincidence or something else?

If like Danish authorities did in late August 2019, calling for a systematic overhaul of their own budding cannabis ecosystem (where both Canadian companies operate), the patterns and similarities here may prove more than that. Sit tight for at least a fall of more questions, if not investigations.

Beyond one giant cannabis conspiracy theory, in other words, the problems, behaviour and response of top executives at some of the largest companies in the business appear to be generating widespread calls – from not only regulators, but from whistle blowers and management from within the industry itself – for some serious, regulatory and even internal company overhauls. Internationally.

And further on a fairly existential basis.

EDITOR’S NOTE: CIJ reached out to Canopy Growth’s European HQ for comment by email. None was returned.

Correction: This article has been updated to show that the Danish recipient of Canntrust’s product announced they were halting distribution one week after Bruce Linton’s firing, not one day.

August 22, 2019

How Much Cannabis Astroturfing Is Afoot In The UK?

By Marguerite Arnold

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Astroturfing is the practice, in political messaging and campaigns, of creating what seems to be a legitimate, grassroots inspired campaign that is actually bought and paid for by an industry lobby or other corporate interests.

It is also clear that this practice is now entering the cannabis space, certainly in the UK.

How and Where?

On August 1, the British Conservative Drug Policy Reform Group sent out a group email entitled “Strategic litigation on medical cannabis access in the UK.” The email, from the group’s senior communications manager, was to announce the kick-off of a crowdfunding campaign to defend a cannabis patient.

It’s beneficiary? A British female MS patient, Lezley Gibson, now facing prosecution for growing her own cannabis after being unable to afford what was on offer at her local pharmacy.

Here is the first flag: MS is the only condition for which Sativex (manufactured by British firm GW Pharma) is prescribed on label (in other words without special approvals).

The problem is that the NHS (along with most of the German statutory approvers) feels that Sativex is still too expensive and not effective enough. And that problem won’t be solved with either patient home grow access or a lawsuit to gain that right, but rather funded trials.

However, more disturbingly, the email referenced the supposed success of a similar legal tactic in Germany several years ago. This is to say it used a highly inaccurate analogy. In Germany, a male chronic pain patient sued the government for the right to grow his own cannabis. He won the right temporarily, but this was taken away from him after the law changed in March 2017. Now he, like every other cannabis patient in Germany, must get his cannabis from a pharmacy. German patients also must get their initial prescription approved by health insurers – which is for everyone – but particularly non MS patients – the biggest fight in the room right now on the topic of medical efficacy.

Further, the right to grow one’s own medical cannabis, no matter the condition suffered, has been removed from patients in every legal jurisdiction where there is no constitutional right to it first – namely patients sue for the same.

As such, it is entirely conceivable that as a “strategic” case, this is more likely to put pressure on the NHS to pay the sky-high price of Sativex for MS patients (which it has already refused to do) than create any other kind of access for anyone else.

When contacted by Cannabis Industry Journal, a CDPRG spokesperson said that the patient had given her support for the crowdfunding campaign and needed help.

piechart — Most German Patients Are Still Only Getting Dronabinol

However, there are other issues here. Namely that when selecting a strategic case (no matter how harsh this sounds to the individual patient), the entire discussion at this point – certainly from an efficacy point of view, might be better served with supporting the case of a patient who has less access because of either physical condition or economic status.

In fact, in Germany so far, thanks to the change in the law that the British group references, while there certainly are tens of thousands of cannabis patients at the moment (including many MS patients), the majority of them receive Dronabinol or Sativex. And all of them have to fight for medical access and approval from their insurers. That is of course, when they can find a doctor to prescribe in the first place. There are also estimates that there are close to a million patients in Germany who cannot get access, thanks to the change in the law created by one patient’s law suit.

Is this flavour of litigatious advocacy now afoot in the UK, in other words, the kind of lawsuit that is designed to benefit the industry more than patients looking for affordable, home-grown, if regulated product?

Astroturfing Cannabis Issues Under Brexit Colors?

No matter the real versus stated intent of the instigators of the Gibson case, or the eventual outcome of such litigation, there is no doubt that cannabis is being brought into larger political debates. And further, no surprise, “patient access” is an issue just as ripe for “issue manipulation” and astroturfing as anything else.

“Strategic” if not “crowdfunded” cause or tactical lawsuits are another form of this technique.

That foreign cannabis money is already in the room is also no surprise. The British press was alight with stories during June of the amount of money contributed to the CDPR Group from Canadian sources.

Seen within the context of Brexit itself, this is disturbing locally.There are other issues involved in this kind of challenge to the law.

Not to mention the fact that in May, none other than Arron Banks, the self-styled backer of the Leave Campaign, decided, suddenly, to throw his hat into the CBD oil ring on Twitter. Not to mention repeated the same information repeatedly, including his $4 million investment into the space during the following months so far. Plus, of course, wildly optimistic valuations of the U.S. market.

Suing For Patient Justice Or A Backdoor For Canadian and Other Corporate Interests?

There are other issues involved in this kind of challenge to the law.

The first is that in the British case this is actually not a constitutional case per se, but a human rights one. See the problems that those who are trying to define the British constitution right now on other matters (see Brexit) are running into.

The second is that while the patient in question in this case (Ms. Gibson) is undoubtedly relieved at the prospect of a legal defence for growing her own medication in the face of insurmountable cost, on the “positive” side, her case is unlikely to do much more than make impoverished patients fight NHS paperwork if they can find a doctor. See Germany, as a prime example.This lawsuit, in other words, no matter how it might get one woman out of a terrible legal situation, is not necessarily “pro-patient.”

But what it will do is something else. It may well remove the current widespread prohibition on the harvesting of cannabis flower in the UK. And while patients would face again being moved into the slow lane of NHS approvals (with lots of fights over efficacy looming and still unsolved), corporate growers and processors if not importers, already investing millions into such efforts across the UK and Ireland, benefit.

At the exclusion, also, as has been the case in Germany, of local producers who are not already large corporate interests or existing farms.

This lawsuit, in other words, no matter how it might get one woman out of a terrible legal situation, is not necessarily “pro-patient.” It also may well do everything to frustrate, slow down and further complicate medical access for those at the end of the chain, while only opening up “investment opportunities” for large companies and well-heeled interests who have nothing but profit, if not the destruction of the NHS in mind.

August 5, 2019

European Cannabis Summer Roundup

By Marguerite Arnold

2 Comments

There have been many significant developments this summer in Europe that will shape the debate about reform and the legal cannabis market that trails it, for at least the next year. Here is Cannabis Industry Journal’sroundup of our biggest events and trends over the summer so far.

Medical Sales Across Europe Are Slow

In Germany, it is easy to maintain a fairly ballpark understanding of patient count. Find the number of prescriptions issued in the trade press and divide by four. Everywhere else, however, the true realization of what is going on across Europe is slowly starting to hit everyone outside producers wanting to know what is going on.Establishing territorial footprint has been what the race in Europe has been all about since mid 2016 for the Canadian LPs so far.

This is going to start to hit stock prices soon beyond the wobbles already evident in the market thanks to this summer’s breaking industry scandals (CannTrust, lawsuits in every direction) to lack of financial performance for investors (Bruce Linton’s firing from Canopy). It is becoming increasingly obvious to everyone that just because a public Canadian company issues a press release about a (cultivation, import, export or processing) “event” does not mean anything other than a slew of social media telling everyone about it. The frustration with “forward looking” statements has hit European investors big time, from the retail to the institutional kind.

Despite a lot of press releases in other words, which clearly show market penetration, there is not much else going on from the sales perspective when it comes to growing those first numbers. Establishing territorial footprint has been what the race in Europe has been all about since mid 2016 for the Canadian LPs so far.

However, from an industry, if not investor and of course, patient perspective, patient numbers are what really count. And unlike Canada, where patients remain the biggest existential threat to the industry, the same industry may not sign them up or ship to them directly in Europe. For several reasons.

Germany is still the only country in Europe with a significant patient count, and while growing, slowly, is still a group where 2/3 of patients obtain dronabinol. It should shock nobody that the most accurate patient count right now in the UK is hovering somewhere under 20. For the whole country, 9 months after the law changed. While the peculiarities of Brexit are also in the room, this is so far, compared to U.S. state markets, Canada, Israel and Germany before it, pathetic.

The Industry Says It Supports Patients…But Does It?

There are several levels to this debate which start with the still appallingly high level of price gouging in the room. 2019 and certainly this summer is a time when the Canadian companies are clearly learning that European governments negotiate for drugs in bulk. Even (and especially in the near future) this one. See the difference between the EU and the US.

The level of industry promotion vs patient access recently reached a new nadir this summer when it emerged that despite a great deal of interest, more people showed up (by far) to the week-long cannabis industry conference (European Cannabis Week in London in June) than there are legitimate patients in the UK right now.

That is about to change, but so far, industry support for trials has not materialized. When the various trials now being planned do get going, look for new battles over a couple of issues, starting with patient access to and control of their medical data.

Novel Food: The Regulation That Keeps On Giving

The issues involved in this discussion are complex, certainly by North American standards. This of course starts with the fact that there is no such regulation on the continent. But also rapidly bleeds into puncturing the amount of hot air entrepreneurialism there is in the room.

The structure of cannabidiol (CBD), one of 400 active compounds found in cannabis.

The CBD market in Europe that everyone got so excited about in investor releases, in other words, is basically dead for the time being. Yes, there are a few smart niche players weaving around the regs, but it is a full-time job.

Here is the reality: Since Christmas last year when Austria put the kabosh on all products containing the cannabinoid CBD, several major countries have weighed in on the issue. It is not going away. And it is here to stay, even after recreational.

Political Advocacy Is Stirring In Europe

Whether it is the vagaries of Brexit, the discussion across the continent about how the EU will work together, right wing populist screeds about “too much regulation” or national elections, cannabis is in the room from now until the end of at least 2021 as one of the hottest global political issues under the sun. That includes of course, a discussion about global climate change, sourcing, pricing and resource use so far unaddressed but rapidly looming.

Further, patients are still having a voice – whether it is making sure that their children obtain imported CBD, or that they can obtain their own THC prescriptions without going bankrupt or having to solicit in the black market.

Cultivation Bids Looming?

One of the surest signs yet that the German authorities at any rate, are in no mood to solve the cultivation issues still on the ground and the bid itself, is that the government just renegotiated, for the second time since last fall, the amount of medical cannabis to come over the Dutch-German border. Who is going to go next? With the Italian hybrid now done and dusted, Poland is likely to be next. And when that happens, expect a raft of similar initiatives across Europe. But probably not until then.

And in the meantime? Distributors are looking for product. The demand is clearly there. But across Europe this summer there is a clear sense that the hype machine that has been the industry’s mouthpiece is at minimum overenthusiastic about the bottom-line details behind it all.

July 30, 2019

Sweden Joins Italy In Path To Defining CBD Oil Regulations

By Marguerite Arnold

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The highest court in Sweden has weighed in on the novel food, and the darling of the Swiss marketplace, CBD conversation. Further, it has done so in a move that seems predetermined to push the so-far escalating novel food debate EU-wide. Along, of course, with what constitutes “narcotic” cannabis.

Namely, Sweden’s highest court ruled in June that CBD oil with any concentration of THC falls under the narcotic jurisdiction.

Sound confusing? Welcome to the world of every CBD producer and purveyor on the “right” side of the Atlantic.

Beyond The Lingo and Legal Mumbo Jumbo

When one follows the logic, there is one, hidden in the Swedish meatball of careful legal wording. Here is a translation, more or less of what the court intended.

The first is that the Swedes, along with the Italians (and expect this attitude to be reflected all over Europe) accept that cannabidiol when it comes from hemp, if not CBD oil derived from the same, generally, is excluded from the definition of cannabis (as a narcotic). Therefore it is not a narcotic drug.

However, according to the court, the loose definitions of what “CBD oil” is both legally and in the marketplace, no longer applies if the plant has been converted into a preparation containing THC. This is a clear shot across the bow of the “Cannabis Lite” movement that has been so popular across the continent for the last year or so and has absolutely electrified certain regions (see not only Switzerland but the UK and Spain).

This has added to the sky-high evaluations of the cannabis industry (or even the CBD part of it) in certain industry predictions, rosy scenarios and forward-looking statements.

However, in a nod to reality, the court also recognized that there is an exemption for trace amounts of CBD in the current frameworks, although it is indeterminate. In other words, this is a move to force regulators to determine what trace levels of THC are permitted. And further, to force regulation and licencing of the so-far, fairly free-wheeling industry that hoped, much like Holland, to establish itself in the grey spaces between the regulatory schematic of Europe.

Just some of the many CBD products on the market today.

No dice. See Holland of late. But also see Italy, Austria and Germany.

For those who still held out a vague dream of hope that this whole issue was going to go away, or get swept under the carpet of anti-regulatory Brexit mania (in the British case), think again.

In the Swedish situation, much like the Italian CBD caper, the individual at the heart of the court case was a man who escaped a minor drug charge for possession of CBD oil. However, the message is clear: Large scale distribution of CBD oil with “undeterminable” levels of THC (essentially all of it in the market until the rules are set), is courting a criminal drugs charge.

Look for licensing definitions soon.

What Does This Say About The CBD Future In Europe?

Much of this debate is also caught up in larger issues, namely labelling. The British, for example, have just seen recalls at some of the largest supermarkets in the country because of the same. It is a hot topic in several places.

Europeans, in general, and this includes the British, are generally also horrified at how Americans in particular, consume food and other products exposed to chemicals they know are toxic. However common chlorinated chicken is in the U.S., for example, this is a discussion as toxic to all Europeans, including the British, as well, chemically treated anything.

This is also a reflection of the much “greener” lifestyle Europeans aspire to lead (even with bizarre gross-outs like “fatbergs” in the Victorian recesses of London sewers). Even if they have not managed it yet, here. Climate change denial, especially in mostly air-conditioner free Europe, and especially this summer, is a rare concept indeed.

The novel food issue where it crosses with cannabis, in other words, has just popped up again, in Sweden. And given its proximity to not only recent legal decisions on the same, especially by their neighbors, if not on the calendar, the industry and all those who hope to chart its projections if not successfully surf its market vagaries, need to take note if not adjust accordingly.

July 30, 2019

UK Non-Profit Launches Project TWENTY21 To Register 20K Cannabis Patients

By Marguerite Arnold

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In late June, as more than a thousand people descended on the South Bank Center to attend the largest cannabis conference held so far in the UK, another development was taking place away from the headlines.

Drug Science, a non-profit research group founded to reform drug policies based on scientific evidence rather than politics or even economic considerations, launched an ambitious trial project in the UK.

The goal? To get medical cannabis to 20,000 British patients suffering from a range of conditions that the drug is well known to help treat.

Who Is Drug Science?

Founded by Professor David Nutt, the former chief drug advisor to the British government who was fired in 2009 for stating that ecstasy and LSD were less harmful than alcohol, the group itself is clearly not afraid to tackle controversy. The Project TWENTY21 initiative is an ambitious if not desperately needed undertaking.

Targeted patient groups include those suffering from chronic pain, PTSD, MS, Tourette’s and addiction.

Several cannabis companies have already signed up to support the effort which also includes the United Patients Alliance ,and academic researchers.

According to Abby Hughes, Head of Outreach for UPA, “Whilst a change in UK law has given clinicians the green light to prescribe medical cannabis, the majority of patients are denied access, some even being criminalised, whilst corporations are profiting from the same plant.”

Hughes also noted that the goal of the project is to begin to ground patient demand in research and hard data. “We hope that by having a dataset that proves the efficacy of medical cannabis, thousands of patients will be able to access legal, affordable medicine, which may improve their quality of life,” she said.

What Is The Scope of Project TWENTY21?

It is the first-of-its-kind project in the UK where, 9 months after the law changed to allow prescription of cannabinoids as well as the medical importation of the same, there are less than 20 (legal) patients in the country. And all of the successful candidates so far have fought for the right and still do.

While important in its own right, the concept if not forward motion on the same, is also poised to create similar trials all over Europe. This is especially true in countries (like France) where the issue of reform has not moved at all. Or even in Germany (with well over 50,000 patients two and a half years after similar reform was passed by the Bundestag) where problems with access and questions about medical efficacy still frustrate the close to a million Germans who cannot access the drug. Switzerland and Luxembourg may yet prove to be similiarly interesting.

Why Is This Timely?

There has been an increased call for the need for widespread and sustained population trials across Europe as the cannabis industry has really begun to establish itself since mid-2016. This is the only way to help forward medical understanding of cannabinoids at a level that leads to mainstream acceptance. And more importantly, medical and payer mainstream approvals. Until that happens, despite all the press releases, overall sales across the continent remain low.

One of the most important issues beyond this – the extraordinarily high pricing seen in Europe until late last year – has also played a role of course. Payers (see the German “statutory” health insurers) on the front lines of uncertain medical efficacy are still reluctant to pay for a drug, in any form, they do not understand, do not have evidence for, and are still highly suspicious of.

There has been an increased call for the need for widespread and sustained population trials across Europe With cannabis companies agreeing to provide product (in this case potentially from Australia), a research organization with national chops and brave leaders is likely to take the conversation far. And not just in the UK.

While Drug Science is of course not the only British entity planning canna trials and in part supported by the Canadian industry (see The Beckley Foundation for starters), Project 2021 is also certainly likely to be a study with both local as well as regional and global implications.

In Europe, there are other regional trials now in the offing (see Switzerland, Germany and France). Only Germany of course, has a patient population that is starting to be large enough to be effectively studied, and of course, the majority of these patients are still receiving dronabinol.

It is also clearly a steady state march, rather than a discussion that is likely to see significant boosts in patient numbers any time soon. Unless of course, there are other contributing factors.

Regardless, unlike the U.S. and even Canada, the strict medical focus of Europe (including the UK) is finally moving the conversation to the next level. Large, regional and/or national medical trials – and further for conditions the drug is well-known to treat but are so far considered “off-label” for most Europeans will be the watchword here for the next several years.

July 17, 2019

The Face Of Cannabis Education In Europe

By Marguerite Arnold

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More than a few cannabis “education companies” – mostly from Canada and the U.S. but some with Israeli ties, plus German and British efforts have targeted Europe as the next logical expansion plan in their global roadmap.

These include most recently Cannvas Medtech Inc., and several initiatives funded by Canopy Growth, including teaching children about the drug. It also includes training programs for frontline staff, launched by Organigram (although in this case it appears to be geared towards “brand education.”)

There are also doctor training programs launching in the UK.

In Germany, there are several efforts underway, helmed by both doctors and cannabis advocates generally, in several cities around the country.

But how effective is all of this “education” in both preventing illegal use, and promoting legitimate sales?

Particularly if such “education” platforms are exported from a foreign market for use in Europe?

Education Is Desperately Needed, But So Is Channel Penetration

Nobody is arguing that “education,” as well as trials and more information for payers and doctors are not required. The problem is that some education is more effective than other campaigns. And most of the talk in most places is more a discussion of the need for further regulatory reform, more trials and more investigation.

That has to get paid for somewhere.

That, at least in Europe is also tricky, as both early educational movers Weedmaps and Leafly have both found out, especially in medical only markets in the EU. Why? There are also highly limited opportunities for advertising either a drug, or to doctors.

Different Regulatory Environments Cause Bigger Issues

Even in Canada and the United States, there is an ecosystem of supplying the demand that has very much grown up customized by the strange paths to reform if not the first mover discussion.

That is not going to be the case in Europe, which in effect creates a brand-new ecosystem to educate, with new players, and every ecosystem participant group has a different kind of educational needs.

Here is one example of where this shows up. So far, in most countries, doctors are still highly resistant to prescribing the drug. Nurses, on the other hand, in both the United States and Canada at least, have proven to be a much more reliable source of converts for the cannabis cause. That approach of course is not possible in places like Germany where only doctors may issue prescriptions, including of the cannabis (and narcotic) kind.

Access issues also play a big role in just about every country- from cost to privacy. And on the privacy front, it is not just foreigners who are getting used to new rules. So are German doctors.

The pharmacy discussion is also very much in the room – and this is not “just like” approaching a “dispensary” from North America. They are regulated chemists. Which causes a whole new set of issues and a serious need for new kinds of educational materials.

In Germany, for example, pharmacists are being recruited and trained by not only staff recruiters specializing in the same, but also sent on special training courses funded by the big Canadian companies (Tilray being the noticeable one recently). The brick and mortar vs. online discussion is also a big topic across Europe. Notably, where it is allowed and where it is, as in Deutschland, verboten.

And, of course, the big green giant in the room everywhere in Europe, in particular, is payer/insurance approvals, which are based on a kind of education called proven medical efficacy.

And that, so far, is in markedly short supply.

In the UK, it is so far the main reason that NHS patients (for example) cannot access coverage for the drug to treat conditions like chronic pain.

In the meantime, the most widespread “education” that is going on, is still mostly at the patient level. Especially when patients sue their insurers, or lobby doctors to prescribe.

The cannabis industry may be maturing, in other words, to be able to answer these questions – but there is also clearly a long way to go.

July 17, 2019

Corporate CBD Production Gets Underway in UK

By Marguerite Arnold

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Any thought that established British and Canadian growers were not already cooperating and in the throes of establishing a UK cannabis production base was put to bed in early July.

Namely, the news that Sundial, an Alberta based Canadian company, is buying Bridge Farms, the winner of the Overall UK Grower of the Year Award in 2017, is a sign that the age of British cannabinoid production (and in bulk) is here. The agriculture group has a 75-acre production facility in Lincolnshire (strategically on the border with Norfolk) and a recent ₤18 million equity injection.

This also means that large-scale CBD production in the UK is now underway with authority.

What it also means, however, is that the winds of trade, even if historically, are already cultivating some interesting partners as the entire British cannabis discussion gets underway.

Sundial Growers also almost simultaneously filed documents to list on the Nasdaq in the U.S. In this, they look remarkably similar to Tilray.

British Sugar Is Now Not The Only Game In Town

The links to the cannabis industry in this part of the UK are not new. Namely, the county of Norfolk (the east-coast “bump” of the British coastline just south of Lincolnshire) is home to British Sugar, the cultivator for GW Pharmaceuticals cannabis crop.

This part of the world is also historically associated not only with major international British trade, but in the past at least, of the German kind in particular. See the port of Kings Lynn and the Hanseatic trading route that put the eastern town on the global shipping map until the advent of the railroads in the UK leached its importance south, to London in the 19th century.

Foreign investment in agriculture, in other words, in this part of the world is not new. Nor is shipping the final product elsewhere.

What Does This Mean For The British Market?

That is an interesting question on the advent of a potential Brexit. Is this newly constructed agricultural centre designed, like Canopy’s newest hempire in New York State, for domestic consumption, and-or overseas trade?

For that reason, a fully automated CBD production facility in such a strategic and historic part of the country seems to indicate the commercial production of CBD has begun at a level virtually unseen in any other European country so far. And further, that its backers have an international, not just domestic market, in mind.

What Does This Mean For the European Market?

Unless the UK is planning on eviscerating all worker safety and pay regulations, it is unlikely that British-grown cannabis will be price competitive with what is going on in Europe right now. The German market, in fact, is a very good precursor to the kinds of growing pains the UK is likely to see in this regard.

Exports, in other words, are highly unlikely, at least to Europe.

What this does mean however, is that licensed producers, with international roots and global financing, are clearly moving into the more or less corporate production market that is slowly getting going in Britain.

And just like elsewhere, post Canada, there is no chance, at this point at least, for any “mom and pop” industry to develop.

Given a lack of patient access at this point that is also not likely to fly politically for long.

Regardless, as of the summer of 2019, there are beginning to be the signs that large scale production of both THC and CBD, is getting going in Britain.

No matter where their customers are located.