Bedrocan and the ‘weed experiment’

The Dutch government initiates an experiment involving the cultivation of cannabis for recreational use, the so-called ‘Controlled cannabis supply chain experiment’ or – popularly – ‘weed experiment’. The purpose of the experiment is to determine whether and how controlled cannabis can be legally supplied to coffee shops and its effects. As a supplier of medical cannabis to the Dutch Ministry of Health, we often receive the question: do you also participate in this experiment? That is a very understandable question. However, the answer is simple: No.

Bedrocan does not participate in the Controlled cannabis supply chain experiment. In fact, Bedrocan has informed the Ministry of Health from the beginning that it does not want to be directly or indirectly involved in any way. This also means we do not share knowledge for the benefit of the project or participate in any other way.

1. Why not?

Bedrocan believes in the strict separation of ‘medicinal cannabis’ from ‘cannabis for recreational use’. We are committed to providing a pharmaceutical product that is available on prescription for patients who benefit from it. We want to fully focus on this assignment. It is easy to predict that patients will become victims of the legalisation of recreational use. Not by the legalisation itself, but by the fact that producers could be tempted to plunge into this market. The quality requirements are lower, the rules easier, controls less strict, and yields (possibly) higher. Result: medical cannabis receives less (or no) attention, and patients will be left without a product. Or they are left with products that do not meet their requirements – standardised and of pharmaceutical quality. We want to prevent that at all costs. The quality requirements of recreational cannabis are different, which means we’re talking about a different product.

Moreover, it is true that the use of cannabis can indeed have adverse consequences. That is why we want our products to be available only to patients who use it on prescription and under the guidance of a pharmacist. We also want to use our years of knowledge and experience in the field of cannabis cultivation for this purpose.

2. Have you not been asked to participate or to provide information?

Yes, very often. Initially by the government itself and recently also very often by companies that want to engage in the experiment. The answer is and will always be ‘no’.

3. Isn’t that strange?

It might sound strange. But suppose the government does a trial with legal XTC pills, would a pharmaceutical company that now makes antidepressants or rheumatism drugs turn up there? Of course not. The same goes for us. Medicinal cannabis and cannabis for recreational use are two different products with a completely different target group. You shouldn’t mix them up.

4. Does the government see it that way?

Yes. The medical cannabis program and the Closed cannabis supply chain experiment are entirely separate within the national government.

Health care professionals and COVID-19

In Europe, many healthcare professionals are involved in the production, prescription and delivery of medicinal cannabis products. A number of them have been portrayed in this place. How did they survive the first months of the COVID-19 crisis?

Italy: home delivery spiked tremendously

Dr. Marco Ternelli – Farmagalenica SRL

Dr Marco Ternelli runs an Italian pharmacy,  and he is specialised in compounding medication, among which is medicinal cannabis.

“In Italy we saw an increase in home delivery including medical cannabis. Because home delivery has taken a tremendous spike, patients need to have more patience than before as pharmaceuticals couriers take much longer to deliver than usual. In Italy, a medicinal cannabis prescription lasts only 30 days. So patients shouldn’t wait too long to contact their doctor to apply for a renewal. Otherwise, you’ll surely run out of medication before the pharmacy can deliver it to you.

During the lockdown, pharmacies in Italy were one of the very few activities left open, so we kept seeing people directly.  We were continuously explaining and reassuring patients of what was going on.

They used to say ‘Biggest improvements come in hard times’. I have to admit I have seen some. In order to avoid people gathering at the doctor’s waiting room, all reimbursed medicines have been digitized. This means that the patient simply has to go to the pharmacy, show his medical ID or fiscal code and the pharmacist is able to digitally download all the prescriptions. We are waiting and hoping the same to happen for medical cannabis prescriptions. Unfortunately, being a controlled substance, it didn’t take part in the digital transformation.”

The Netherlands: “We stayed close to the patient, literally”

Paul Lebbink – Transvaal Apotheek

Paul Lebbink heads the Transvaal pharmacy in The Hague with eight other pharmacists. The Transvaal Apotheek was the first pharmacy in the Netherlands to produce and supply various varieties of cannabis oil, in line with the Dutch medicinal cannabis program.

“We see about 200 patients on average every day. Locking the pharmacy was not an option, because those people need medication. We immediately took measures to ensure that both patients and staff could be as safe as possible in our pharmacy. Plastic screens, possibilities for disinfection, a maximum of five patients who could be inside at the same time and of course the ‘one and a half meter rule’, to name just a few. And although the latter measure in particular is not easy with a limited floor space and a relatively large number of people, it has been possible to create a COVID-safe environment. In addition, we increased the number of deliveries in March and April. Every day, five couriers drove around to serve patients, which enabled us to reduce waiting times in the pharmacy.

The delivery of medicinal cannabis and medicinal cannabis oil has proceeded normally; In the Dutch medical cannabis chain, the organisations responsible for production and distribution have proven to be COVID-proof. As always, we were able to serve patients on time. Our own production and supply of cannabis oil has also been carried out according to plan. We also have not had any questions from patients about the alleged effect of medicinal cannabis in COVID. We would have reacted cautiously, because of course we only base ourselves on scientific evidence.

In the meantime, the rules in the Netherlands have relaxed somewhat again. The same goes for the rules in our pharmacy, because a ‘1,5 metre society’ is not what we want. We want to be close to the patients, literally.”

Denmark: “Online video consultation kept us open”

Dr. Tina Horsted – Pain Clinic Horsted

Dr. Tina Horsted runs a public clinic. She is the only doctor in Denmark who is specialised in prescribing medicinal cannabis, mainly to chronic pain patients.

“We have been open during the lockdown. We had a continuous steady flow through the crisis, as we developed a video-based online application to help new patients and keep up with ongoing medical controls. And it’s been working very satisfying, both for the patients and the clinic. The video format has more or less forced the patient and us to discuss the actual problem straight away. Patients, therefore, get more value out of their time. For the future, we will keep on doing more medical controls or lighter consultations via this application. Patients are relieved that they do not have to travel for each check-up. But of course, it can and will never replace an in-person consultation if this is required. In the clinic, we have well-designed glass panels, in the waiting room we have removed half of the chairs and all magazines, and there is no coffee. But people are now used to these percussions.  

The Norwegian patients are starting to come back, but the Swedes have been coming to the clinical psychically during the whole period. With a special letter, provided by the clinic, they were able to cross the border.”

Metered dose cannabis inhaler enables precise cannabis treatment

Precise cannabis treatment dosing remains a major challenge, leading to physicians’ reluctance to prescribe medical cannabis. A recent feasibility trial demonstrates that a metered dose cannabis inhaler, produced by Syqe Medical and containing processed Bedrocan cannabis, enables individualisation of medicinal cannabis regimens. “This study is the first to show that human sensitivity to THC is significantly greater than previously assumed, indicating that if we can treat patients with much higher precision, lower quantities of drug will be needed, resulting in fewer side effects and an overall more effective treatment. The Syqe drug delivery technology is also applicable to opioids and other compounds that, while potentially effective, are notoriously associated with dangerous side effects. The introduction of a tool to prescribe medications at such low doses with such high resolution may allow us to achieve treatment outcomes that previously were not possible,” said Perry Davidson, Syqe Medical CEO.

According to dr. Mikael Kowal – Clinical Research Coordinator at Bedrocan International – this outcome is an important step for developing cannabis as an effective treatment for pain. “Syqe Medical’s randomized placebo-controlled clinical trial demonstrated that a metered-dose cannabis inhaler containing processed Bedrocan cannabis was able to dose-dependently produce analgesia in 24 patients with neuropathic pain/complex-regional pain syndrome (CRPS),” says Kowal. “As such, the results indicated that the inhaler can effectively be used to deliver precise doses of pharmaceutical-grade cannabis that can produce an analgesic effect with lower amounts of THC, than in the case of other administration methods. It remains very interesting to see if the pain-reduction resulting from inhaling low and precise doses of THC will remain stable in the long-term. That is definitely a question for future research with this promising device.”

Listen now… ‘European Cannabis. A Dutch view’

A podcast episode featuring Bedrocan CEO Tjalling Erkelens

Today’s episode of the Cannabis Conversation was recorded at the Central European Cannabis Forum, earlier this June. Host Anuj Desai and Tjalling Erkelens, Co-Founder and CEO of Bedrocan, examine attitudes towards CBD, medical, and recreational cannabis in The Netherlands, alongside discussing the importance of consistency and standardisation of medical cannabis.
The Cannabis Conversation is a weekly podcast exploring the emerging legal cannabis industry from a European perspective. The podcast hosts a wide variety of guests helping to shape the emerging legal cannabis industry including patients, lawyers, doctors, scientists, entrepreneurs, investors and many more.
You can find the Cannabis Conversation on iTunes, Spotify  YouTube and Stitcher. Of course, there is a website too.

Patient group: ‘Denmark still lacks affordable oils’

Two years ago, the Danish medical cannabis pilot programme has allowed doctors to prescribe cannabis products to vulnerable patients who failed to respond to traditional therapies. According to Rikke Jakobsen, CEO of Secretariat of the Danish patient group Cannabis Danmark, it is still difficult for Danish patients to obtain medical cannabis. “There is not enough variety in the products available.” The result is that last year the number of patients using medicinal cannabis has decreased significantly, from 1,200 to 300. A total loss of 900 patients.

In Denmark, both patients and doctors prefer oils, and this also goes for Danish scientists. Currently in the Danish pilot program, only three dried flower products from Bedrocan are available. After the Canadian oil supplier CannTrust was suspended, based on revelations that the Ontario producer grew thousands of kilograms of cannabis in unlicensed rooms, there was an increase in prescribed isolated THC-oils from the pharmacies. As in the Netherlands, patients can also get medical cannabis from the magistral scheme. Rikke Jakobsen says: “Until now it’s only isolated CBD and THC. We know from a doctor, who prescribes most of the prescriptions in Denmark, that very few patients benefit from the isolated CBD from the pharmacy. Besides that, it is very expensive.”

Rikke Jakobsen

Rikke had hoped to see Danish products on the market in the first half of 2020, but due to the COVID-19 pandemic, things got slowed down. “Unfortunately, we see that many patients use the illegal market to obtain cannabis for medicinal use, both CBD and THC-rich cannabis. It is still very difficult to find a doctor who will prescribe.”

License

Also, according to Rikke, there are still not enough growers in Denmark, despite the 30 companies with cultivation licenses issued by the Danish medicines agency.

Cannabis Danmark

Cannabis Danmark helps patients obtain medical cannabis prescribed. They were formed in 2017 by a group of people who found it important that patients should not be forced to criminalize themselves to get the medicine that they needed.

One of them was Danish actress Søs Egelind who used cannabis for nausea, while undergoing chemotherapy. The group has been instrumental in getting the Danish pilot program started by lobbying. They are often invited to conferences to speak about the Danish Program.

logo Cannabis Danmark

This development program only allows growing, and crops have to be destroyed. Only two companies have been approved for the pilot program so far. “Many are stuck in this development programme because it’s a very costly affair to live up to the final approval for the pilot programme. Especially to gain the required GMP-certificate.”

Despite the lack of more cannabis varieties, Cannabis Danmark advises not to turn to the black market. They recommend solely prescribed medical cannabis. Their patient advisory board tries to help patients get a prescription. “We spend a lot of time on fact-based information about medical cannabis. It can be difficult to get through to the population when so much unregulated online sales flourish with misinformation and unregulated products. We don’t judge the buyers, but instead, spend a lot of time talking about what the unregulated and illegal market looks like.”

Private clinic

Patients who do get their medical cannabis legally very often get it through a private clinic. Jakobsen estimates the private clinics prescribe up to fifty percent. Rikke says: “A majority of the doctors are still opposed even though they have written consent from their patients. It’s not so much about the lack of evidence as it is the lack of guidance and education from our medical agency – at least that’s the argument from Clinical Cannabis Forum, a local initiative made up of prescribing physicians and medical cannabis researchers.”

“It is important because it is the only way to know what you get and that you get the exact same thing every time. Medical cannabis is a personalised medicine and different people react differently to the same components. Furthermore, studies have shown that even a different harvesting time can influence the way the plant acts.”

Join free GreenTech webinar about medicinal cannabis

Our CEO Tjalling Erkelens joins the first GreenTech online webinar about medicinal cannabis that takes place on Wednesday, June 10. GreenTech offers horticulture professionals an online platform for sharing and gaining knowledge. Below you can find more information and a registration link on the upcoming webinar Medicinal Cannabis still growing strong. The webinar starts 4 pm (CEST).

Market

Despite COVID-19 and slower regulatory developments, the medicinal cannabis market is still growing globally. In the free webinar, more experts will give an update about their regional markets, from the USA, Canada to Europe, and Australia. The second part of the webinar will be a discussion around all cultivation aspects and the latest developments.

You can register yourself, through the green button below.

Alternatively, you can watch the webinar through a live stream on the GreenTech Facebook page.

During the webinar, public questions will be answered by the panellists. You can already share them beforehand by sending an e-mail to greentech@rai.nl.

More webinars

Green Tech offers more webinars from 8 till 10 June about  indoor and vertical farming, and Wageningen University & Research will announce the winner of their Autonomous Greenhouse Challenge 2020.

For a complete webinar overview go to the GreenTech website.

Bedrocan present at online CECF conference

The CECF Medicinal Cannabis Conference is known as the biggest business cannabis event in Poland and Central and Eastern Europe (CEE). It brings together entrepeneurs, doctors, investors, patients, businesses and the government. Due to COVID-19 the initial CECF Medicinal Cannabis conference – planned in May – had to be cancelled. That’s why the Central European Cannabis Forum (CECF) decided to make it 100 procent online. The 2020 CECF conference is ‘the largest virtual conference on medical cannabis in the CEE region.’ It will be held on June 9 and 10. Our CEO Tjalling Erkelens accepted the invitation to join the opening panel on June 9.

For more info and tickets click the button below.

MJBizDaily launches second edition of its European market overview

On May 6, MJBizDaily issued the second edition of ”Medical Cannabis in Europe: The Markets and Opportunities.”; an updated overview of the medical cannabis markets and regulations in Europe. Alfredo Pascual, an International Analyst for MJBizDaily and co-author, talks about the report and shares some conclusions. “The unstoppable exponential growth of the European markets that many companies often project in their investors’ decks isn’t necessarily based in reality.”

When asked about the most important conclusions from this year’s report, Pascual immediately points at the sales figures. “On a macro level, the main take away is that sales of medical cannabis in Europe continued growing rapidly in 2019, especially thanks to German patients. Italy, which is the second-largest European market, also had double-digit growth over 2018. However, the other side of the coin is that all other European markets remain quite small in comparison.

Another conclusion is that the unstoppable exponential growth of the European markets that many companies often project in their investors’ decks isn’t necessarily based in reality. There are plenty of examples in Europe of markets where for different reasons, sales don’t always follow the exponential growth trend, like Czech Republic from 2015 until 2018, the Netherlands since 2016 or Denmark throughout 2019.
There are also more specific insights readers can find. For instance, that isolated cannabinoids represent a large portion of sales in Germany, Switzerland and Denmark, and the vast majority of sales in Austria where flower or full-spectrum extracts are not allowed. This is often overlooked.”

Focus changed

According to Pascual, the focus of the new report has changed. “One year ago, there was still an incredible amount of excitement about new countries allowing companies to apply for cultivation licenses. So in the first edition of the European report, I made an effort to include at least the basic licensing requirements for growing in some of these countries. But one year later, the focus of the industry switched to revenue-generating opportunities. It’s not really big news anymore if one more country allows companies to apply for a license to grow and export the products. In fact, some of the leading companies in the industry are shutting down some of their grow operations because they realized they had too many. What matters most now is where medical cannabis can be sold. And that’s the focus of this edition of the report: where and how can medical cannabis be sold in Europe.

What didn’t change much from last year’s report are the companies that grow medical cannabis being sold in Europe. There are dozens of projects in Europe and overseas with the goal to supply Germany and other countries with cannabis, but only a few manage to actually do so. Something else that didn’t change from the first edition is that Germany remains the largest European market, even larger than all others combined.”.

Latin America

As mentioned, MJBizDaily issues a report on the Latin American market as well. Alfredo Pascual – who covers both continents – sees some remarkable differences “Revenue opportunities in Latin America are still behind Europe, as many companies and investors see Latin America as a production region mostly to export to other parts of the world. That’s why the Latin American report has a bigger focus on production licensing requirements than this edition of the European report, which focuses on revenue possibilities.

A similarity between both reports is that although these try to provide content about a region, it’s impossible to talk about the European or the Latin American markets. These are huge geographical regions that in both cases have an enormous disparity within their countries and little regional harmonization when it comes to medical cannabis.”

Gregor Zorn. A commitment to high standards

He has become a familiar face at medicinal cannabis events. Still, not everyone knows that Gregor Zorn has been an independent medical cannabis educator and consultant for years, before he accepted his job as Chief Scientific Officer at Cannaray Ltd. in November of 2019. One with a mission, because he wants to gather and spread scientifically based knowledge. Besides many cannabis events, his outlets were the European Cannabinoid Therapy Association, the Padua University Medical School, social media, and his own website gregorzorn.com. On his page, he says: “Cannabis crops are the most versatile, useful and easiest to grow, and it is underutilized, mainly, due to intentional false propaganda.”

Change the trend

It all started for Zorn in early 2014 when he attended a medical cannabis symposium in Ljubljana. He was blown away by the research and case studies of how cannabinoids could help in a variety of medical conditions and the crucial role of the endocannabinoid system in the maintenance of our health. He wanted to learn more, so he started researching this fascinating area himself, and never stopped. “My first goal was to have a basic understanding of this topic,” Zorn says. “As I didn’t know much on the medicinal use of cannabis, I started from learning the basics of cannabinoids, cannabis, and the endocannabinoid system (ECS). As a biology student, I never heard of the ECS at my university or anything about cannabis. I was perplexed that such an important system is not taught to biology or medical students. I was also surprised by the number of scientific papers that were available on this subject and started reading all the ones I could get my hands on. As my knowledge progressed, I  noticed a lot of incorrect information on the internet, by so-called ‘cannabis experts’, activists, and organisations. Many of which were driven by their personal financial motives. I wanted to change this trend.”

Scientifically backed knowledge

His career as an educator and consultant developed slowly but progressively. Zorn attended all the relevant medical cannabis events, talked to the top cannabis experts, and continued his theoretical and practical education. After gaining confidence in his knowledge, Zorn started doing medical cannabis presentations, mainly to medical professionals. “The vast majority did not know anything about medical cannabis use, and patients needed help. It was a great experience.”

As an educator and consultant, Gregor Zorn always wanted to deliver easy to comprehend, relevant, and scientifically backed knowledge. “It is essential for me to deliver complicated information in the way that the recipients fully comprehend and feel more comfortable using this knowledge, personally or professionally. As a consultant, the goal is similar but it applies to specific areas of interest such as medical cannabis growing, product development, clinical research, clinical trial implementation, and other scientific services.”

What didn’t change much from last year’s report are the companies that grow medical cannabis being sold in Europe. There are dozens of projects in Europe and overseas with the goal to supply Germany and other countries with cannabis, but only a few manage to actually do so. Something else that didn’t change from the first edition is that Germany remains the largest European market, even larger than all others combined.”.

High standards

It is also important for Gregor Zorn to make a distinction between recreational use and medicinal use. “For recreational users, the goal is usually to get a positive experience, to change consciousness, and connect with other people on a different energetic level. With medicinal use, the goals are more focused on the treatment of specific symptoms or medical conditions. This is achieved with precise dosing of selected medical cannabis products, following a regular schedule, ideally prescribed and followed-up by a medical professional.”

According to Zorn, this also sets requirements for the product. “Medical cannabis is cannabis that has been grown, processed, stored, and distributed for medicinal use. It should adhere to the highest standards of safety. It should be tested to show compliance with the absence of pesticides/fungicides, bacterial/fungal contamination, heavy metals, and residual solvents. It should also be tested for the levels of the major constituents, cannabinoids, and terpenes, as this provides essential information for dosing, chemovar selection, and correct storage of the product. I think it should be standardized as much as possible, which can be problematic, especially for cannabis inflorescence. This can only be done with stable genetics and a fully monitored grow environment. This can be challenging for most licensed producers, which is reflected in the differences between batches of the same chemovar.”

With the interest of its medical applications growing by the day, we see more research is being done in this area. However, there are still sever, mainly bureaucratic, roadblocks due to its narcotic status. This hinders our understanding, applicability, and full potential of this medicinal plant. There are also many misconceptions about this plant that need to be addressed and not perpetuated further. Companies working in this sector should adhere to the scientific approach, and some of them are doing a great job. However, many are still relying on cheap marketing tricks, just to boost sales of their products. This can have negative repercussions on the credibility of this industry as a whole.

On the other hand, it is also important to listen carefully to medical cannabis users, who have had personal experience for their specific conditions. Such feedback is incredibly valuable, as it provides patients real-life experiences, what works doesn’t work, dosing, cannabinoid ratios, and other useful data. When enough data is gathered, it can be a valuable resource for developing therapeutic protocols, medical guidelines and clinical trials, as well as developing new cannabinoid formulations and cultivars with specific active compounds.”

A healthy industry

Just before Zorn accepted his new job as Chief Scientific Officer at Cannaray Ltd. and the Covid-19 measures shook the (cannabis) world, he pondered six years of being in the middle of the medicinal cannabis world. He visited a lot of cannabis-related events and met hundreds of experts, producers, regulators, patients, and other people involved in medicinal cannabis. He was also able to see the downside of a fast-growing industry. “Organising cannabis events has become an industry itself, and you can compare it with the cannabis industry as a whole. With so many cannabis events popping out all over the globe, the speakers’ quality is going down, and with the increasing interest in this developing field, every other speaker is presented as a medicinal cannabis expert. Patients, health care professionals and regulators are not always able to see who’s trustworthy anymore. It’s the same with the cannabis industry as a whole. I believe that those who are strictly focussed will survive. Anyway, I do hope the lockdown results in a healthier medicinal cannabis world, where the good are separated from the bad. A world where strict pharmaceutical requirements are normal, and where patients will benefit in the end.”

The current state of medicinal cannabis investing

There has been a tremendous amount of hype surrounding the global cannabis industry over the past few years. This hype, mostly stemming from the boom in the Canadian cannabis market, has created unrealistic expectations particularly for investors in the sector. With more and more cannabis companies being unable to meet these expectations, the industry has reached a transitional moment, a transition that is only being accelerated by the COVID-19 crisis. As an expert in the field, what does Bedrocan encounter in the medicinal cannabis industry from an investment perspective? What are the regulatory challenges we face as a medicinal cannabis contract manufacturer for the Dutch government? As a potential investor in this space, you might like to know, so here are some insights.

Author: Andrew Kraszewski – Business Development at Bedrocan

Canadian cannabis and the capital markets: A cautionary tale

Cannabis as both a medicine and a consumer product has garnered a significant amount of attention lately owing mostly to the capital markets activity in North America. In the build up to recreational cannabis legalisation in Canada in October 2018, billions of Canadian dollars were funnelled into the sector, ushering in a new era of the “green rush” and the prosperity of legal cannabis markets. But now, in only year two of full legalisation in Canada, the cannabis markets paint a far gloomier picture, with some of Canada’s household names in cannabis running out of cash. With significant change now expected in the industry, how we got to this point exactly and what this means for the sector moving forward has important ramifications for Bedrocan and our place in the international medicinal cannabis ecosystem.

Copy of article of journalist Mark Rendell published in the Financial Post

My personal journey in the medicinal cannabis sector began in North America in January 2016. At that time, none of the big banks or major institutional investors were active in the industry because cannabis was, and still very much is, a controlled substance meaning any cannabis business activity carries a high degree of regulatory risk. However, in Canada, where the cannabis market was being liberalised (alongside numerous states in the USA where state laws for medicinal cannabis programs and recreational cannabis programs were being instituted), certain financiers and investment banks were willing to take the necessary risks to advise and fund this burgeoning sector. Mark Rendell’s 2018 Financial Post exposé into the financing of the Canadian cannabis market revealed that, curiously, only a handful of companies were responsible for financing vast portions of the industry. These financiers were opportunistic hedge funds that do not normally have the long-term interests of the companies at heart. As Rendell highlights, these investors deployed several tactics to generate short-term, outsized returns and they recycled their capital through deal after deal after deal.

At the time, the narrative protruding from the big Canadian companies was that they intended to rule the recreational market at home and the medicinal cannabis markets abroad. To be the biggest and best, it was all about building capacity. Capacity, as a company valuation metric, was one that investors often pointed to when assessing a cannabis company, the simple reason being that the more cultivation space a company had, the greater its potential revenue. As a result, operators ploughed millions of Canadian dollars into building manufacturing facilities both in Canada and foreign jurisdictions such as Denmark, Jamaica, and Colombia. In the end, it really did not matter if these investments made strategic sense or not, for the investors of these companies, the opportunistic hedge funds, were purely interested in executing a financial trade, normally with a retail investor at the very end, who had been led to believe that the cannabis hype was all worth it.

Cultivation capacity

With manufacturing facilities now shuttering in Canada and internationally, it is evident that many companies overextended their cultivation capacity. In Canada, a widening gap is developing in the recreational market between Canadian sales throughput given the limited retail stores opened to date and the volume of dried cannabis currently sitting in supply channels. In what has now become a race to the bottom, Canadian operators are pivoting towards outdoor cultivation in a bid to reduce cultivation costs (and finally reach profitability).

With respect to the international pullback, the story is a bit more complex and requires an understanding of the regulatory environment in which medicinal cannabis companies operate.

The Single Convention on Narcotic Drugs of 1961

The single most important piece of legislation that impacts medicinal cannabis companies globally is the United Nations Single Convention on Narcotic Drugs of 1961 (theSingle Convention”). Under this international drug control regime, the use of cannabis is limited to purely scientific and medicinal purposes. The Single Convention stipulates that countries must adopt a stringent control system for medicinal cannabis through a government agency. In the end, it gives countries a degree of flexibility in their interpretation of control but the Single Convention specifically requests that local government agencies purchase and take physical possession of medicinal cannabis before it is sold domestically or traded internationally.

Special Access Schemes

Domestic medicinal cannabis programs provide patients with access to medicinal cannabis under Special Access Schemes, which require evidence that patients have exhausted their options with respect to trying registered medicines. Certainly, providing access to medicinal cannabis under Special Access Schemes is fully compliant under the Single Convention. However, when it comes to implementing the Single Convention, countries have applied varying degrees of stringency with regards to medicinal cannabis controls. A country with one of the strictest interpretations of the Single Convention is the Netherlands. It is through the Dutch Office of Medicinal Cannabis (OMC), where Bedrocan cannabis flower as an active pharmaceutical ingredient is distributed to pharmacies, researchers, and pharmaceutical off takers, both domestically and internationally. In the Netherlands, the OMC is responsible for overseeing the production of cannabis for medicinal and scientific purposes and Bedrocan is a contract manufacturer for the Dutch Government.

Controlled substance

All this is important to stress the fact that medicinal cannabis is a highly controlled substance, which is difficult to move across borders. Further, it highlights that medicinal cannabis should be treated like any other pharmaceutical product, which must be produced in accordance with good manufacturing practice (GMP). Many companies simply discovered that medicinal cannabis exportation would never be possible from their chosen jurisdiction, for a multitude of reasons, and were forced to either focus on the domestic opportunity or abandon ship altogether.

In short, business plans built upon the export of medicinal cannabis from one jurisdiction to another have so far failed to meet expectations because they underestimated the challenges presented by the Single Convention and that holding a license to cultivate, process, and export medicinal cannabis does not mean anything unless there is an off taker in another nation – one which has already been granted an import permit from its local authority.

The Netherlands and its place in the international medicinal cannabis supply chain

The Netherlands was the first nation in Europe to legalise medicinal cannabis back in 2003. It has been exporting medicinal cannabis since 2007 when the first shipments to Italy and Finland were made. It is very important to note, however, that while the OMC has been exporting medicinal cannabis for quite some time, this was never the primary objective of the Dutch medicinal cannabis program; the focus has always been on the domestic patient in the Netherlands. As such, exports from the Netherlands have grown organically over time in response to demand in other nations. For example, in 2019, the Dutch government received a formal request from their German counterparts to increase the annual volume of medicinal cannabis flower imported into Germany from 1,500 kg to 2,500 kg, a request that was subsequently granted for 2020.

Sole supplier

Bedrocan, which can trace our beginnings to the 1990s as a seed production company, has been the sole supplier to the OMC since 2003 making us one of Europe’s oldest medicinal cannabis companies. Undeniably, the sheer length of our operating history has afforded us the opportunity not only to scale up operations in a capital-efficient manner as the international medicinal cannabis market expanded but also to hone our cultivation craft. The quality of Bedrocan’s genetics, which have been grown for over twenty-five years, in conjunction with our tried and tested cultivation techniques, results in our ability to produce high-quality and consistent cannabis flower. In addition, Bedrocan has invested in building cultivation facilities that are GMP certified meaning we strive to reach the highest possible standard for our products. All considered, Bedrocan’s flower can be found in clinical research projects, product development initiatives, and Special Access Schemes worldwide.

From our perspective, the topic of standardisation is one of the biggest roadblocks to the acceptance and prescription of medicinal cannabis today. Quite simply, it is challenging to prescribe medicinal cannabis when you do not know the exact contents and amounts of cannabinoids in a cannabis-based medicine. Further, standardised, and high-grade raw material as an active pharmaceutical ingredient is critical for any pharmaceutical product development. Without question, our ability to standardise the manufacturing of cannabis flower has generated trust in Bedrocan’s products across regulators, researchers, doctors, and patients.

Trust

This trust that has been built in Bedrocan’s medicinal cannabis flower alongside the Dutch Government’s strict adherence to the Single Convention has meant that the Netherlands is one of a handful of nations that has been able to successfully export medicinal cannabis on a consistent basis. All things considered, importing nations are far more likely to trust a government counterparty that is operating within the confines of the Single Convention. Additionally, countries are more likely to import medicinal cannabis that has been grown and processed under GMP – that is to say, medicinal cannabis that has all the necessary paperwork to back it up. These factors have contributed towards the Netherlands, together with Bedrocan, now occupying a unique position in the international medicinal cannabis supply chain.

The Dutch OMC checks the medicinal cannabis at Bedrocan's facility
The Dutch Office of Medicinal Cannabis takes samples of medicinal cannabis at Bedrocan's facility

Investing in the medicinal cannabis sector

For investors who have already invested or are considering investing in the medicinal cannabis sector, comprehending the regulatory landscape is the most important prerequisite to making informed investment decisions. Being frank, the international medicinal cannabis industry is a very difficult business and building supply chains across borders is fraught with regulatory challenges. Furthermore, the investment landscape has changed dramatically over the past twelve months following a precipitous fall in market valuations, which has only been compounded by the COVID-19 crisis. Naturally, history often repeats itself and the cannabis industry to date has been your typical story of boom and bust.

Longer term

Now that cannabis markets have corrected, investors should start to look at companies that are positioned for the longer term, have their core fundamentals in place, and focus on a specific segment of the medicinal cannabis supply chain. Luckily for us at Bedrocan, we have been in a very unique situation given our relationship with the OMC in our singular role as a contract manufacturer and the fact that we have never been beholden to external pressures, such as capital market forces. We have remained laser-focused on doing what we know – and that is growing high-quality, standardised medicinal cannabis flower. As it transpires, one of the biggest issues currently facing the medicinal cannabis market on the cultivation side is the production of cannabis flower that meets the highest quality standards and ultimately achieves the necessary batch-to-batch consistency in terms of cannabinoid content to be effectively used as a medicine.

Specialisation

In that vein, we believe that specialisation is a trend that will continue to develop in the medicinal cannabis market. Given the capital-intensive nature of medicinal cannabis operations generally, full vertical integration is a fool’s errand and it makes more sense to collaborate with companies across the entire supply chain, something that happens in any regular industry. In the end, we hope that medicinal cannabis will be treated like any other medicine and that it follows the normal pharmaceutical pathway. This route is definitely timely and costly, and in search of greater returns, cannabis companies have started shifting their resources away from the medicinal cannabis market towards the recreational opportunity, which often comes at the expense of the medicinal cannabis patient.

The fallout from the recent cannabis market downturn has only served to underline this trend. Indeed, there has never been a more important time to invest in a responsible medicinal cannabis ecosystem and at Bedrocan, we will continue to do what we have done since our inception: cultivating to serve our patients.

Five must-read studies on medicinal cannabis

At Bedrocan, we strive to bridge the gap between patients’ need for cannabis and the quality standards of modern medicine. That’s the focus of our research.  We build strong academic and private research partnerships and conduct our own independent studies. In the end, we share what we learn.

Every month, several study results on the use of medicinal cannabis are published in the media. With sometimes varying results. But how do you know what a good study is? Dr. Mikael Kowal from our own clinical research department has listed the most important ones. To become acquainted with cannabinoid research you should have read these five studies.

1. Acute pain

This review discusses the evidence surrounding the efficacy of cannabinoids for acute pain. It concludes that there is low-quality evidence indicating that cannabinoids may be a safe alternative for a small but significant reduction in subjective pain score when treating acute pain. It is worth reading to illustrate the difference in the evidence for the effectiveness of cannabis in treating acute, as opposed to chronic, pain.

2. Chronic pain

This review evaluates the efficacy, acceptability and safety of cannabis-based medicines for chronic pain management. It provides a summary of data presented in previous reviews, so it is a valuable overview of most of the data available on the topic. The review concludes that there are inconsistent findings of the efficacy of cannabinoids in neuropathic pain and painful spasms in multiple sclerosis. Moreover, there are inconsistent results on tolerability and safety of cannabis-based medicines for any chronic pain.

3. Pain management

This review evaluates the efficacy, acceptability and safety of cannabis-based medicines for chronic pain management. It provides a summary of data presented in previous reviews, so it is a valuable overview of most of the data available on the topic. The review concludes that there are inconsistent findings of the efficacy of cannabinoids in neuropathic pain and painful spasms in multiple sclerosis. Moreover, there are inconsistent results on tolerability and safety of cannabis-based medicines for any chronic pain.

4. Multiple Sclerosis

This summary of reviews aims to synthesize findings from systematic reviews that examined the safety and effectiveness of cannabinoids in multiple sclerosis. It concludes that cannabinoids may have modest effects in MS for pain or spasticity. The review provides a complete overview of the evidence on cannabinoids and MS.

5. Fibromyalgia

This is currently the only clinical published study which we fully supported as Bedrocan. Aside of providing interesting information on the efficacy of our varieties in treating fibromyalgia chronic pain and THC/CBD interactions, it is worth reading in order to have an idea how to set up a properly designed randomized controlled trial with cannabis.

Bedrocan’s medicinal cannabis production not affected by COVID-19 crisis

In an online video interview with Marijuana Business Daily, CEO Tjalling Erkelens explains that the measures to curb the spread of the coronavirus do not yet affect Bedrocan’s production of medicinal cannabis. You cannot keep patients waiting for medication, which is why the company has taken all the necessary measures to ensure that production – which serves many patients in Europe – goes according to plan. “We can produce for the next few months undisrupted”, says Erkelens.

According to Erkelens, the coronavirus outbreak once again underlines the importance of scientifically based knowledge and, thus, also scientific research. “These uncertain times will hopefully teach us that money is way less important than people’s health. We have to lean on science as our guide in staying healthy.”

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