Austrailia's top-down approach may benefit its cannabis goals
In late February 2017, the Australian government legalized the use of medical marijuana nationwide, in an effort to make the drug more easily available for seriously (especially chronicly) ill patients. Around a year later, in early 2018, it took the unexpected step of authorizing the exportation of medical cannabis.
This has opened the door for Australian companies, potentially, to become some ofthe world’s best suppliers of top grade medical cannabis. (Although it’s worth noting that the government has also granted the possibility of licenses to import legal marijuana for medical purposes to fill the gap between the needs of patients and Australia’s ability to supply the required amount of cannabis in the short term. In pact, theprimary motive for this move by the Australian Government, is for exactly the same reason – to ensure supply for Australians.
Australia is then, it seems, taking a notably different route to the legalization of cannabis to the path the USA followed. Australia is starting at the Federal level and working down. The result is likely to be better considered than the implementation undertaken in America. The US has seen a number of both political and practical problems with the rollout of new state drug laws that differ markidly in intent from the relevant federal statutes – for example, banks not accepting profits from cannabis companies.) The other side of the coin, in Australia, is that it may take longer to work through the process of legalization and the journey may be more bureaucratic.
FACTAustralian government has granted the possibility of licenses to import legal marijuana for medical purposes to fill the gap between the needs of patients and it’s ability to supply the required amount of cannabis.
Australia is aiming for medicinal marijuana global domination
Health Minister Greg Hunt said Australia would like Australia to become the number one supplier of medical cannabisin the world. According to some, the ambition could create a sizable industry in Australia.
One proponent of growing legal cannabis in Australia, Niv Dagan from Peak Asset Management, an investment firm,suggests that the governments announcement of it’s global ambition has opened the floodgates of further investments into Australia, from overseas. He predicts a $1 billion retail cannabis market in Australia by the year 2020.
At least some members of the share market agree. Hunts announcement has seen some Australian Cannabis manufacturer and export prices explode. The Cann Group’s (An Australian cannabis consortium) share prices went up 35% after the legal export announcement, in a move indicative of investor interest in the category and a global trend towards legalisation.
Some industry watchers consider the opportunity with cannabis in the same terms they review alcohol sales.The US based consulting and research consulting firm “Grand View Research”forecasts that the global market for legal medical cannabis product will be in excess of $55 billion by 2025 or $63.4 billion by 2024, if you prefer to listen to the Financial Times in London.
ECONOMICS“Grand View Research”forecasts that the global market for legal medical cannabis product will be in excess of $55 billion by 2025 or $63.4 billion by 2024
After the rhetoric
Australia’s rollout of medical cannabis laws might be more bureaucratic and take longer than their equivalents in other jurisdictions but that’s not necessarily a bad thing.
Rollouts have been plagued with problems in the USA. The Government should, instead, use the lessons learned, and experience of the other countries that have already legalization of medical cannabis, to form a workable and profitable cannabis industry, that benefits all Australians and ensures supply for those who need it.
There appears to be more work to do, however, before we reach that stage. Even now, 2 years after cannabis was legalized for mecidinal use, patients in need are still finding it hard to locate the drug and Doctors are not finding it easy to prescribe. Only 500 Australians are using mecidinal cannabis at this point, compared to a suspected number ten times that large who want it but can’t get it.
Hunt, the architect of the number 1 in the world goal admits there are problems, that the application process GPs must work through in order tolegalise marijuana is too onerous and needs to be simplidied. He says he has written to his counterparts in the states asking for their help in achieving that goal.
Nevertheless, thousands of Australians with a genuine need for mecidinal cannabis find it so impracticable to procure it through their GP, the suggestion is that they have been turning to the black market to get it.