Suppose someone told you that two innovative industries were poised to revolutionise healthcare and create tens of thousands of jobs in the process. They would contribute billions to our COVID-stricken economy whilst attracting global talent and investment to our shores. They would also showcase the benefits of divergence from the European Union. Anyone would take advantage of such an opportunity with open arms.
The industries in question are medical cannabis and CBD. The UK has already begun to embrace the potential of these nascent, fast- growing markets: undoubtedly accelerated by the legalisation of medical cannabis in 2018. Cannabis listings opened on the London Stock Exchange earlier this year, an advanced regulatory framework has created significant opportunities for future growth in domestic CBD businesses compared to their continental counterparts and the UK remains the largest exporter of medical cannabis in Europe.
The European market for medical cannabis is the fastest growing in the world and our unique position gives us the prospect of becoming a leading player in medical cannabis and CBD. This paper provides a fascinating overview of the state of play in these markets, opportunities for growth and the regulatory questions that face the sector. It shows how the UK is in a prime position to become the centre of the European medical cannabis and CBD industry, as well as the significant economic benefits that would result.
It also examines the innovation opportunity inherent in these markets: embracing these sectors will help to attract the best and brightest scientists to the UK. We are internationally acclaimed for our leadership in research and development in countless sectors, and through two case studies this paper shows how medical cannabis and CBD are both fertile ground
for driving innovation in medical and health products.
The UK has led the charge in ensuring our CBD industry is one of the first in Europe to be fully compliant with Novel Foods regulation while allowing the market to grow. The paper shows that companies involved in this space stand to benefit from the regulatory clarity this provides, as well as the associated boost to investment and consumer confidence through establishing high standards. The risks to competition from onerous regulatory burdens pushing out smaller businesses have also been mitigated through the European Industrial Hemp Association’s (EIHA) Novel Food Consortium, which has helped to reduce the cost of compliance by pooling applications for Novel Foods certification.
Despite our achievements to date in this area, we cannot rest on our laurels. There are still questions to be answered around appropriate legal limits on naturally occurring THC content in CBD products. If the limits are too harsh, we risk hamstringing the market just as it has the greatest opportunity to flourish and grow.
For medical cannabis in the UK, the elephant in the room is the challenge of widening patient access. As the paper highlights, there are still substantial barriers facing those in need of prescriptions. Sensible regulation, encouraging investment into the sector and conducting further research on cannabis-based medicinal products are all vital components of ensuring the UK becomes a centre of excellence for medical cannabis in a way that benefits patients, not just the economy at large.
This piece was written by Adam Pryor, Head of Programmes at the Adam Smith Institute