The Ministry of Health is reviewing parts of the medical cannabis industry regulations, as growers and businesses say they will go bust waiting for approval to sell products.
As the first company in New Zealand gained approval to manufacture cannabis medicines this week, paving the way for the first locally-grown product to enter the market, there is unease about how the scheme is running.
This week the ministry confirmed a grace period allowing suppliers and importers time to get their products up to minimum standards will expire by October and won’t be renewed, having already been extended. However, it also says it’s reviewing some aspects amid issues about workability and interpretation of the Misuse of Drugs (Medicinal Cannabis) Regulations 2019.
Industry members say the Medicinal Cannabis Scheme is failing patients, and that groups without investors will likely fail, blaming exacting standards that are time-consuming, costly, and near impossible to meet.
MARK TAYLOR / STUFF
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The concerns are shared by businesses spending millions to try to manufacture medicines, and licensed growers who began cultivating but can’t sell their product yet.
One grower Stuff spoke to, who wouldn’t be identified, had invested $500,000 of family money into becoming a licensed cultivator, but so far hadn’t been able to sell any because of the difficulties of testing the plant. He’d let go of two staff.
He’d hoped to supply a New Zealand market, but has accepted business viability will rely on exporting. If things hadn’t picked up by the end of the year, he’d have to re-evaluate, he said.
“The Ministry of Health has set these standards so high that it’s physically impossible to pass… it’s been a year with no return,” he said.
“Normally you open the doors of a business, and you’re instantly trading. We’ve approached the Ministry of Health pretty much from the start of this year, when we realised it wasn’t working, about what they need to change, and what’s wrong, and why it’s wrong. They haven’t made any effort to right things.”
He believed companies with investor backing were happy to play the long game but “they’re feathering their own nests. The reality is, growers are losing money every month and going broke. I’m quite emotional about it”.
New Zealand has the highest medical cannabis standards in the world, which imported products must meet, too. There are only four approved, imported products available to patients, made by pharmaceutical giant Tilray. While the New Zealand Medical Cannabis Council, representing industry members, has supported the high standards, saying it will make Kiwi product a standout, entrepreneur Chris Fowlie is sceptical.
The Zeacann founder says Kiwi businesses will be competing in a market where competitors’ product is made cheaper, and patients won’t necessarily care for the difference in quality. He believed the local market was much narrower than projected. While there are about 250,000 Kiwis living with chronic pain, prescription numbers suggest just 2000-3000 are accessing medicinal cannabis. Fowlie knew of one grower who’d pulled their crops up, and not replanted.
“The opportunities are there for smart players and people with a bit of patience… [but] it’s not an even playing field. I don’t think the politicians even know this. I don’t think they’re interested. I don’t think they care.”
While businesses were suffering, patients were too, he said. The objective to provide affordable, accessible product had not been met. The cost of Tilray products is at the discretion of pharmacies, and small bottles have been known to sell for up to $600. While other products can be prescribed now, importers have until the end of September to ensure those products meet minimum standards too. If not, patients will be left with Tilray.
Industry groups were on Thursday notified that Medicinal Cannabis Scheme transitional arrangements would end on September 30.
Industry members Stuff has spoken to would like to see changes made to microbiological contamination standards, and to reduce costly batch stability tests once manufacturing is under way, from six months to half that.
MedLeaf chief executive Courtney Letica said it had cancelled several contracts with overseas suppliers because they couldn’t meet minimum quality standards, and was keen to see a regulatory review of the scheme, which was expected some time ago. However, the Ministry this week said there were no plans for such a review.
Instead, “The Ministry is aware that there are a number of issues with interpretation and workability of parts of the Misuse of Drugs (Medicinal Cannabis) Regulations 2019 and is reviewing some parts with a view to whether the regulations are working in line with their intent,” a spokesperson said.
New Zealand Medical Cannabis Growers Association secretary Abe Gray said industry players publicly praising the scheme were ignoring the elephant in the room.
“Their primary goal is to preserve optics for future investors and shareholders. Growers are just getting the runaround but, for the big guys, it suits them to have nobody getting out of the starting blocks until they get (manufacturing permission).
“Plants are sitting here just piling up, we’re trying to get the ministry to realise this is an unrealistic level or method of testing.”