Applied Technology

Global Differences in Cannabis Extraction and Production

Loren DeVito, PhD
Written by Loren DeVito, PhD

The growing factors to consider in the  international market

While Canada and Uruguay are the only countries to have fully legalized cannabis, nearly 30 other countries have approved the use of medical cannabis for specified conditions. Analysts have predicted that several other countries, including Luxembourg, France, Italy, and Lebanon, will update their cannabis policies in 2019. And, despite the state-by-state approach, regional legalization of medical and recreational cannabis is expected to continue to spread in the US.

Expanding global cannabis legalization presents significant opportunity for economic growth but also poses challenges to those working within this international framework. Each country sets their own policies and regulations regarding cultivation, processing, sales, and transport. These differences greatly impact every step of production – including extraction. Those interested in playing in the global market must pay close attention to the details of these regulations to avoid producing products that do not meet regional standards.

All eyes have been on the Great White North after recreational cannabis was legalized on October 17, 2018. However, at the time of legalization, cannabis-infused topicals, concentrates, and edibles were not included under the new regulations – for recreational users, that is, as patients can still purchase medical products made from concentrates.  The Canadian government delayed updating this policy so that they could fully evaluate public health and safety risks.

Recently proposed Canadian regulations include restrictions on THC content (10 mg) in edibles and extracts, strict policies regarding additives in edibles, as well as product labeling, and standardized testing. While these policies will be implemented at the national level, cannabis companies must also adhere to regulations put in place by Canadian provinces – these may dictate the possession limit, minimum age, and cultivation requirements. The cost of these products will differ greatly from Nova Scotia to British Columbia, which will significantly affect the bottom line of companies that plan to sell products across province lines.

While Canada has received much attention recently due to its newly expanded market, the medical cannabis market in Europe continues to thrive. For example, in Germany, there is high demand for medical cannabis, as indicated by the approximately 80,000 prescriptions written during the first half of 2018. However, this market is currently being served by imports, as Germany does not have a cultivation program in place. The cannabis products being imported therefore follow the regulations of the countries where they are produced but will not be subject to specific German policies until the situation is sorted. As such, there will likely be a significant cost shift when Germany relies less on imports, as well as new policies to juggle.

Israel, home to cannabis research pioneer Raphael Mechoulam, PhD, has long been recognized as a leader in cannabis science and innovation. In fact, Israeli cannabis companies in 2016 received investments of more than $250 million. This scope of funding has cultivated a hot bed of start ups developing technology to disrupt the way cannabis is grown, extracted, and analyzed. And just recently, the Israeli government approved international medical cannabis imports. Due to their elevated status in the cannabis industry, it is likely that others will look toward Israeli companies to set standards of excellence.

Despite global differences in cannabis policies, there are some issues that all parties must manage – such as the current debate over CBD regulations. As the cannabis industry expands to encompass the farthest corners of the world, international companies must pay close attention to evolving policies – many of which continue to treat medical and recreational products separately – as legislators update and refine these regulations.

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Loren DeVito, PhD

Loren DeVito, PhD

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