Supply in Demand: The Consequences of Europe’s Patchwork of Medical Cannabis Reforms
Europe has experienced a wave of cannabis reform in the past year with countries including the UK, France, Ireland, Belgium, Luxembourg and Portugal making strides to regulate medicinal use of cannabis and implement pilot programmes. In parallel, Europe’s largest established medical cannabis markets are seeking to increase supply through domestic cultivation and increased import licences.
The result is an often incompatible mosaic of regulation and policy, with no European standard to adhere to concerning the definition of a cannabis-based medicine, prescription requirements, cross-border regulations and no harmonised supply chain model ensuring patient access to products, despite the same products being nominally available in many jurisdictions across the continent.
These regulatory complexities prevent the development of a sustainable and scalable European medical cannabis supply chain model, which could enable smaller countries to adopt the successful practices of their European neighbours and speed up access for patients.
Whilst Europe’s largest medical cannabis markets attempt to meet growing demand through domestic cultivation, Europe is still reliant on imports
Germany is Europe’s largest medical cannabis market due to its comparatively generous prescribing criteria and system of reimbursement. Currently, the German market’s flower, dried extracts and full-spectrum oils are imported from abroad, predominantly from Canada and the Netherlands’ Office of Medicinal Cannabis. Rather than falling under the purview of the state, Germany issued licences to commercial companies in a tender for the domestic cultivation of 10,400 kilograms of pharmaceutical-grade medical cannabis over four years. Following some initial difficulties with the tendering process, the first harvest is expected by the end of 2020, when the BfArM’s Cannabis Agency will purchase the harvest and distribute it to manufacturers, wholesalers and pharmacies. Imports will still need to play a substantial role in supplying the German market and the country has reduced restrictions on the quantity which can be imported as the current tender is insufficient to meet ever-growing patient demand.
Italy has also struggled with supply shortages and implemented a state monopoly on the cultivation of medical cannabis in the country, with cultivation taking place in the Military Chemical and Pharmaceutical Plant (SCFM) by the Ministry of Defence. The site’s production capacity is reported to be 150 kilos per year with expansion to 300 kilos in 2020 - falling far short of domestic requirements, estimated at up to 1,000 kilos for 2019. A lack of financial investment prevents the SCFM from scaling production to a potential 4000 kilos per year, and while it has been announced that the country will be issuing seven import licences to meet the domestic production gap, Aurora Deutschland have been the only country to win a tender, with the Dutch Office of Medicinal Cannabis also holding an ongoing supply arrangement.
As more countries open up to medical cannabis, will they adopt similar supply models to their European neighbours?
France will begin an 18-month medical cannabis pilot project in early 2020 and up to 3000 patients will benefit from the programme, initially reliant on imports. Jean-Baptiste Moreau and other government officials have expressed their intent to establish a French supply chain for the production of cannabis-based medicinal products, with plans for a national cultivation programme to be developed. With France being the third largest hemp producer in the world, predominantly in the La Creuse region, it is hopeful that the country establishes a sensible production capacity, in contrast to Germany and Italy, to avoid following in their footsteps of supply shortages.
Belgium’s Cannabis bureau was established in April 2019 and has a state monopoly on the production, import, export and wholesale of medical cannabis. Belgium has adopted a similar model to Germany by issuing cultivation licences to private companies before purchasing the entire harvest to distribute and export, ensuring medical cannabis will only be made available to patients from licensed growers through a regulated distribution chain.
Export hopefuls: A number of countries, most prominently Portugal and Greece, have enacted policy reforms to encourage a production for export market. Companies including Tilray in Portugal and Hexomed in Greece are hoping to provide supply across Europe as demand grows, however realisation of this has been long in coming, with many sites still under development, awaiting regulatory approval, or not yet in production.
Is there any movement towards a harmonised European market?
A first step towards harmonisation of the medical cannabis supply chain was evident in the European Parliament’s resolution in February, which is hoped to facilitate standardisation, cross-border trade and patient access. The resolution calls on EU member states to ensure sufficient availability of cannabis-based medicines through domestic production in accordance with national medical standards and through imports. The resolution also calls for a standardised legal definition of medical cannabis to be developed by national authorities and the Commission, and for member states to make a clear distinction between recreational and industrial applications of cannabis.
A harmonised cannabis flower monograph is currently being prepared for the European Pharmacopoeia, which will overcome the need for testing according to national standards and facilitate further research and trials. It is evident that to provide readily accessible, affordable and regulated cannabis-based medicines in Europe, national authorities must come to an agreement on quality standards beyond EU GMP, prescription requirements and distribution across borders.
For more insights and advice on cannabis policy developments in Europe, please get in touch at info@hanwayassociates.com.