Medical Marijuana in Canada Complete Overview

Despite being around for a few years, your average Canadian doesn’t even know that Canada has a medical cannabis program. Even if you did, chances are you heard it was a myth, illegal or impossible to get.

As a matter of fact, the program is administered on a federal level by Health Canada, which oversees the fifty or so manufacturers from coast to coast. You can even grow it at home (subject to approval).

However, the program is barely promoted, can require loads of paperwork and may require chasing down a compassionate doctor. These hurdles help explain why less than 0.6% of the population is registered under Health Canada’s medical cannabis program.

This resource covers 10 topics that will help you better understand the Canadian medical marijuana landscape whether you are an investor, doctor, patient (prospective) or simply curious. Let’s begin!

Ganja.ca– Medical Marijuana Authority

TOPIC 1 BRIEF HISTORY (2014 – 2017)

Medical marijuana has been around in Canada since late 2013, following the enactment of parts of the MMPR. Now called the ACMPR, this set of regulations allows Canadians to obtain authorization from a medical professionals and access marijuana for medical use. In other words, it’s legal if you have a valid prescription from a registered physician or nurse depending.

Interestingly, despite being rather difficult to obtain a prescription, the number of medical marijuana patients registered to buy from licensed producers (LP’s) has grown exponentially since the program was launched nearly half a decade ago. In its first year of launch, the program attracted only 8,000 patients. Total patient registration has increased by over fifteen times since then.

The election of Trudeau in 2015 has been a major catalyst for the industry (recreational included), with patient demand growing at a record pace. Fast forward to today, there are nearly 55 licensed producers (explained in TOPIC 3) over 200,000 registered patients and international export agreements being signed.

  • 2014: 7,914
  • 2017: 201,398

Registered patients

TOPIC 2 THE RULES AND THE RULERS

The Access to Cannabis for Medical Purposes Regulation (ACMPR) is a relatively complex system administrated by the federal government, more specifically, Health Canada. It outlines the entire system, from production and distribution to patient eligibility.

In short, it is 100% legal for eligible Canadians (see Topic 6) have the right to:

  • Purchase from a licensed producer;
  • Produce their own medical cannabis; and
  • Have medical cannabis grown on their behalf

The latter two are uncommon due to the capital and labour intensity as well as the steep bureaucratic hill.

The federal government regulates the production and supply by controlling the LPs across the country using a licensing system.

There are essentially 5 types of licenses:

  1. Dried cannabis cultivation
  2. Dried cannabis sale
  3. Cannabis oil production
  4. Cannabis oil sale
  5. Starting material (plants and seeds)

Becoming an LP requires a combination of experience, deep pockets, and of course government approval. LP’s are discussed in greater detail in Topic 3. It is worthy to note that edibles are illegal at the time of this writing and are intended to remain so for the near future (even in the recreational market).

TOPIC 3 LICENSED PRODUCERS

There are currently 54 licensed producers in Canada, with the majority of them located in Ontario and British Columbia. Producers can apply for one or more licenses for one or many products (dried cannabis, oils, plants, seeds, or other). Most LPs have a license to produce and sell dried cannabis. Licenses are issued together with a quota, limiting the amount an LP can produce and distribute in a year.


# of Licensed Producers

  • Ontario 29
  • British Columbia 13
  • Alberta 3
  • Saskatchewan 3
  • Manitoba 2
  • Quebec 1
  • New Brunswick 2
  • Prince Edward Island 1
  • Total 54

Licenses Issues by Health Canada

Source: Health Canada

Insight: Number of Licenses by Type

Source: Health Canada

The sharp increase in license producer is very much likely due to the anticipated legalization in July 2018. Canadians smoke a lot of pot and the current supply is almost entirely all used for medical patients alone.

Further, LP’s are quite limited from a sales and marketing perspective. Producers, like any other marijuana-related enterprise, aren’t permitted to advertise (much like cigarettes). They are essentially restricted to social media and other referrals as discussed below and later in Topic 4.

This makes it quite difficult to not only attract new customers but to build a strong brand and relationship with the community. Thus, most LP’s are very active on social media and work hard to get on the news, whether it be for a press release, becoming publicly traded or completing a business acquisition. A common trend is developing proprietary products in view of the fact that consistency is essential in the medicinal industry vertical.

To make it even harder on LPs, there are restriction as to how they obtain patients (customers), but rightfully so. Given that licensed producers are motivated to drive sales and profits, prescribing medical cannabis directly to a patient can be a conflict of interest. As a result, licensed producers are highly dependent on their referral network, namely medical marijuana clinics and independent doctors.

Typically, the LP’s sell to Canadians with a valid prescription from a practicing medical professional (in its simplest form). Since marijuana is still highly regarded as a drug rather than a medicine, obtaining a prescription from a medical professional can be quite a challenge. Most are completely against the plant or are not educated enough to be comfortable prescribing it.

TOPIC 4 QUALITY, PRICING & SELECTION

QUALITY. When dealing with cannabis quality, one more look further than the aesthetics and odour of a product. Needless to say, these are important, but the chemical composition, consistency and growth technique are what really distinguish medical marijuana from ‘street’ pot. Most, if not all, of the licensed producers spend countless resources on research and development for this very purpose.

PRICING. However, quality does vary, even within the medicinal world and with it so does the price tag. Our most recent pricing study revealed that dried cannabis prices ranged from $6.81 to $11.67 per gram, with the average being $9.46 per gram. Prices typically vary based on the complexity of the strain, the time and effort required to grow and its proprietary nature and brand. Further, some strains are cultivated in small batches and hand trimmed, while others go through a more automated production process. Licensed producers have even started offering organically grown medical cannabis.

SNAPSHOT | Average Price Per Gram (August 2017)

Source: CannStandard

Average cannabis oil prices varied between $1.48 and $3.33 per millilitre (mL) and the average price per mL was $2.68. With the exception of Whistler Medical Marijuana (Whistler) and Emerald Health Botanicals (Emerald), LP’s hold on average 3 different oil products. Four of the LPs that have a license to sell cannabis oils were out of stock.

SNAPSHOT | Average Price Per mL (August 2017)

Source: CannStandard

SELECTION. Most LPs carry a spectrum of products to cater to the different eligible conditions (see Topic 6) and to offer selection to its patients. The average producer carries 8.8 different dried cannabis products, with some carrying as many as 16 different products. In wake of the anticipated legalization in July 2018, producers have been ramping up their efforts to create new and distinct brands. Further, certain LPs carry oils and capsules, increasing their product offerings. This resource does not consider accessories.

SNAPSHOT | Dry Cannabis Selections (August 2017)

Source: CannStandard

TOPIC 5 SPECIALITY CLINICS

Medical marijuana clinics are just like any other medical clinic, with the exception that the doctors and nurses (depending on the province) are compassionate and believe in the healing powers of medical cannabis. In fact, as mentioned earlier, medical marijuana speciality clinics are the glue to the entire system. They connect patients with compassionate doctors (which are difficult to find otherwise) and licensed producers.

Further, speciality clinics have both doctors and nurses on site (or online) as well as medical cannabis consultants. These trained consultants do the majority of the early prospective patient counselling and screening.

The benefits of medical marijuana are new to most and cannabis isn’t exactly the most accessible medicine. As such, prospective patients often require help submitting the application document(s), selecting the appropriate product (dried cannabis, oils, capsules, etc.) and licensed producer(s). Interestingly enough, most Canadians don’t even know of the existence of medical cannabis speciality clinics, despite being on the rise.

TOPIC 6 Are You Eligible?

The short answer is: probably (if you’re at least 25). The rules were in fact purposely made vague. The regulations officially released by Health Canada state that in order to be eligible, one must belong to one of two categories as follows:

  1. Category 1 - severe and/or persistent pain or muscle spasms from:
    1. Arthritis
    2. HIV/AIDS
    3. Cancer
    4. Anorexia
    5. Spinal cord diseases or injuries
    6. Seizures
    7. Multiple sclerosis
  2. Category 2 – any debilitating symptom from a medical condition not included in Category 1

As you can see, pretty much any symptom can fit within the definition of Category 2; a simple headache or a cold can be ‘debilitating’. But needless to say, medical professionals are very diligent when prescribing medical cannabis, their licenses to practice medicine (or nursing) are at stake after all. A detailed list of conditions and symptoms recognized by most medical professionals can be found in this resource.

What does it take to persuade a doctor? Typically, physicians require at least historical medical records and/or prescriptions, X-rays, diagnoses or proofs of treatment. This isn’t to say that it is a challenge to convince a doctor or nurse, you just require the supporting documentation.

An increasing number of speciality clinic are turning to Health Canada and other respected organizations for medical cannabis prescription guidelines. For example, the College of Physicians of Canada suggests that medical marijuana is not appropriate for those under 25, individuals with a history of psychosis (personal or within the family) and/or addictive behaviour.

Most (if not all) medical professionals seem to abide by the suggested ‘minimum age’. However, medical cannabis ‘minors’ can get access if they have a parental consent note (in conjunction with the standard eligibility requirements).

TOPIC 7 GETTING A PRESCRIPTION

At this point, you are probably eager to just find out how the heck to get a medical marijuana prescription, so here it is. After filling out your initial patient intake form with a medical marijuana clinic, your file will be reviewed to ensure you are indeed eligible and subsequently assigned a medical professional.

You will meet your medical professional (virtually or in person) for about 15 minutes. The health care practitioner will run you through some basic questions to better understand your condition, assess whether medical cannabis is right for you and then, if approved, issue a prescription.

Prescriptions can vary in terms of duration and volume. It isn’t uncommon for medical professionals to initially issue a short-term prescription (typically three months) before issuing a full, one-year prescription term.

Prescriptions are expressed in grams of dried marijuana and can range from half a gram to over ten grams. Prescription over 4 – 5 grams are quite uncommon but have been issued in the past.

Growing Prescriptions. As an alternative to buying medical marijuana from an LP, you can also apply for a license to grow your own plants (or have someone grow on your behalf. However, due to the complexity of the application process and the low frequency of such requests, we will not dive into this sub-topic in this resource.

TOPIC 8 VETERANS

If you are a Canadian veteran, you can be eligible for quite a treat. The Veterans Affairs Canada (VAC) has a program which reimburses veterans for cannabis for medical purposes. Up to approximately September 2016, the program has issued over $30 million in medical cannabis patients, that’s over 4 million grams of pot!

The program has been a tremendous success with the number of veterans taking part of the program growing from 5 patients to over three thousand in just a few years! Although the program has been slightly amended recently, the VAC still covers a big portion of the cost of medical marijuana for its veterans. For more information about the veteran program, including coverage, eligibility and more, visit our complete guide.

New Registered Veteran Patients Per Year

Source: Health Canada

TOPIC 9 THE PROVINCE OF QUEBEC

As with most things in Canada, the province of Quebec is always complicating things and with no exception for medical marijuana. Unlike every other province in the country, the provincial college of physicians requires patients to be registered to the Quebec Cannabis Registry if granted a prescription by a Quebec doctors.

Given that the current system is already complicated as is, this extra layer of work for patients has resulted in relatively very low adoption in Quebec compared to other provinces. In fact, Quebec has the lowest medical cannabis patients per capita.

However, Quebec residents can get around the Quebec Cannabis Registry by working with a virtual cannabis clinic. Given that these clinics are owned by or employ medical professionals from outside the province of Quebec, they are exempt from all that extra paperwork and bureaucracy. Not only that, they can apply from the comfort of their couch or bed.

Percentage of Medical Cannabis Patients by Province

Source: Health Canada; Statistics Canada, 2016 Census of Population.

TOPIC 10 THE FUTURE

In case you weren’t aware, Canadian loves to smoke marijuana both recreationally and medically. As a matter of fact, recreational marijuana will become legal federally as of July 2018 and each province will set its own rules. Two provinces having already established their frameworks. This means that one province may allow you to smoke anytime, anywhere while another may make it quite difficult, despite being legal, although this is highly unlikely.

Provincial governments have expressed that they feel pressure to have their rule books ready for this new industry by next summer and rightfully so. Drafting all the governing legislations and mapping out and deploying the required infrastructure within twelve months is quite a feat. Hopefully, the time crunch won’t impact the industry in a negative way.

In the meantime, licensed producers keep on getting bigger and bigger, expanding their operations, buying out competitors and aggressively attacking new markets. However, most LP’s are either at or near full production capacity, which can prove to be a big problem come next year when the market becomes recreational. It is important to note, however, that there are many pending license producer applications according to recent estimates. Further, 2017 was the most active for Health Canada with respect to handing out licenses as detailed in Topic 3.

The market deficiency will attract new players and in turn intensified competition. From a consumer perspective, this is fantastic news for many different reasons. Not only will a surge in supply drive down the price but it will stimulate research and innovation, and bolster the estimated $22.6 billion industry.

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