Is medical marijuana legal in Australia – A Budding Industry
Australia has the potential to become the international gold standard for production of medicinal marijuana and multiple ASX-listed companies are seeking to benefit.
– Is medical marijuana legal in Australia: Manufacturing of medicinal cannabis products has been legal in Australia since 2016
-Australian revenue from medicinal cannabis projected to double in 2021 to $200m
-Australia has the potential to become international gold standard of production
Forget renewable energy, there is a new concept of ‘going green’ that has Australian investors buzzing.
Medicinal (or medical) marijuana has become increasingly accepted by the public at home and abroad.
Proponents advocate medical marijuana is a safe and inexpensive therapy for conditions such as chronic pain, multiple sclerosis, and glaucoma. On the contrary, opponents argue that formalisation of marijuana lacks formalised clinical testing and could lead to a whole range of perverse ethical conundrums.
Regardless of the ethical outlook, let’s talk ‘Is medical marijuana legal in Australia?’, well legalising all forms of cannabis has tremendous economic potential, both locally and abroad.
Five years ago, landmark legal changes paved the way for regulatory approval of medicinal cannabis products in Australia.
Amendments to the Narcotics Drugs Act in 2016 authorised the legal production and manufacturing of medicinal cannabis products in Australia. Although Australia’s progress on this is relatively nascent, the local sector is budding for growth.
According to the Australian Institute of Health and Welfare, approximately 600,000 Australians used marijuana for medical purposes in 2019. An additional 1.9m reportedly used the substance for non-medical purposes. In addition, over the last year medical prescriptions for medicinal cannabis have tripled.
Medicinal cannabis industry researcher FreshLeaf Analytics has projected that Australian revenue from medicinal cannabis could double in 2021 to $200m. Fresh Leaf Analytics also noted the number of products has more or less doubled each year since 2018, with 190 products now available for prescription.
In addition, a report from research consultants Prohibition Partners estimates that as various phases of legislation come into effect, the Australian cannabis market could break U$1.5bn by 2025. In addition to medical cannabis, changes in the regulatory landscape have some companies salivating at the prospect of a recreational market opening in the future.
Most recently the Australian sector hit a milestone after the country’s medical gatekeeper, the Therapeutic Goods Administration (TGA), downgraded cannabinoids (CBD) from Schedule 4 to Schedule 3.
As a result, consumers no longer require a prescription and can purchase CBD oils and pills over the counter. FreshLeaf estimates the pharmacist-only CBD market in Australia itself will grow to $250m in product sales at market maturity, capturing around 2m consumers.
In addition to a budding local industry, Australian medical marijuana companies are also chasing lucrative markets abroad.
Australian legislation requires that all companies adhere to Good Manufacturing Practice (GMP). As a result, the silver lining of Australia’s sluggish regulatory changes could see the local industry become a powerhouse in growing and producing medicinal marijuana.
Medicinal cannabis products in Australia are regulated by the TGA and the Office of Drug Control (ODC). These strict regulatory standards and ideal climate could make the Australian industry the gold standard of production.
Although many countries are ahead in terms of establishing a medical and recreational market, their pharmaceutical quality production standards have waned. In the US for example, marijuana producers must meet recommended guidelines set by the US Food and Drug Administration (FDA), however, they do not adhere to the same GMP standards as Australian producers.
The development of Australia as a production powerhouse could enable companies to tap into the lucrative and burgeoning global industry. The latest research indicates the global medicinal cannabis market is set to grow around 25% per year, reaching US$67bn by 2028.
Production is not the only avenue that Australian companies are looking to take advantage of.
The Grass Ceiling
In Australia, the holy grail for medicinal cannabis companies is the inclusion in the Pharmaceutical Benefits Scheme (PBS).
However, Australia’s stringent and deliberate processing means the country could be a long way from having an approved and regulated supply chain.
In the meantime, Australian medical marijuana companies are looking to blaze a trail overseas. Regardless of their place on the value chain, there is no doubt the medicinal cannabis industry is budding for growth.
Written by: fnarena.com