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Quality From Canada

Hold on for Rec! Canada’s New ACMPR Program

By Tegan Adams
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Canada’s temporary regulations include a provision for growing cannabis at home, but much of the regulatory model has yet to be illustrated.

Earlier this month, Health Canada, in a press release, gave a glimpse as to what the new Access to Cannabis for Medical Purposes Regulations (ACMPR) might look like. On August 11th, they announced the new set of regulations would go into effect on August 24th this week. Information presented was not shocking. Most Canadians had hoped and suspected that the announcement would include a provision for growing cannabis at home – and it did exactly that.health-canada-logo

Essentially, the ACMPR expands accessibility of cannabis from our highly regulated 34 licensed producers (LPs) to include those authorized by their health care practitioner to access cannabis. Anyone with the appropriate medical documentation can now grow for him or herself at home, or designate a grower to do so for them. Health Canada also stipulated in the press release that “Storefronts selling marijuana [sic], commonly known as ‘dispensaries’ and ’compassion clubs’ are not authorized to sell cannabis for medical or any other purposes.” The regulatory body went on to add: “These operations are illegally supplied and provide products that are unregulated and may be unsafe. Illegal storefront distribution and sale of cannabis in Canada are subject to law enforcement action.”

There were a few curve balls in the announcement, including a statement issued that suggests commercial producers may be the only ones authorized to distribute seeds or plants to those growing for themselves or on behalf of another. It is unclear how the plant and seed sourcing aspect will be regulated and/or how that statement may impact LPs over individual producers. Restriction of strain availability and additional costs are examples of potential implications to individuals[1]. LPs therefore remain in control of the types of cannabis available on the market. It is unclear if this regulatory aspect will mean they can restrict access to strains they have on hand, or not, especially if they are popular for sales.

When the first glimpse of the ACMPR was released, we saw many LPs stock drop in price across the board, in some cases greater than 10%. It is not anticipated however that the ACMPR will cause any long-term negative effects on LPs stock price or profitability. The ACMPR was put in place merely to satisfy a court ruling on a deadline. The deadline was inconvenient, occurring around 9 months before the regulations governing recreational sales are meant to go in effect. It meant that Health Canada employees had to dedicate time to finding a Band-Aid solution up until recreational sales instead of focussing on recreational regulatory framework itself.

Recreational regulations are scheduled for release in 2017, and it is unclear when exactly they will begin. As they do begin to unfold it is projected that the production and sale of cannabis will remain highly regulated. LPs will remain the consistent quality source of supply. There have been multiple distribution models in discussion, including co-op retail ownership, pharmacy dispensary and liquor board models. While yes, those with medical documentation anticipate still being able to produce at home; it is unlikely this allowance will have any effect on the overall sales of LPs as the market unfolds. Alcohol and wine are good examples to compare the regulatory model to. While sure, any of us can do home brewing, odds are we would still like to purchase beer from commercial breweries. In both Vancouver and Toronto, property is very expensive. Higher percentages of the population are starting to live in apartments, condos and smaller homes. Many people working full time are not interested in growing their own cannabis and would prefer the variety of the marketplace. There are many reasons individuals will continue to purchase from LPs. As competition rises in the marketplace, so will efficiencies in production as producers become more familiar with growing practices. Canada is anticipating a drop in retail prices to be much more affordable than existing “black markets.” Cannabis will become commonplace on shopping corners and it will be a product that most will be able to afford.

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