Australia, Canada and other economies are entering the billion-dollar medical cannabis industry
Laws legalising the use of medical cannabis may take some time to catch up, but major players who have seen the huge potential that the industry offers have already entered the race. While only four US states have authorised the manufacture and distribution of the product, companies in countries like Australia, Israel and Canada are receiving support from their respective governments.
The stakes are high, and so are the rewards of those who have taken the plunge and will dare go where no investor has gone before. A study by health-and-wellness company Med-X, Inc. estimates the growth of the industry from US$5.4 billion (AU$7 billion) this year to about US$21.8 billion (AU$28.6 billion) in four years’ time. The Nevada-based firm is actively nurturing cannabis in specialised farms, implementing the highest quality control technologies to safeguard the plants’ health and robustness, before shipping them out to distributors. Med-X, Inc., through its media arm, The Marijuana Times, can answer questions and inform the readers of the medical and financial benefits that medical marijuana can offer them.
In Australia, the growth potential might even be higher. The Australian medical marijuana industry itself is looking at earnings of $100 million a year just for the first year. It pegs the current value of the entire global medical cannabis industry at $250 billion. The figures come from a research paper done jointly by a university and a medical cannabis company: University of Sydney Business School and MGC Pharmaceuticals. The study comes just in time after the Parliament has signed into legislation the manufacture of medical cannabis; Australia’s various states are now drafting bills that will govern the regulation of production.
Michael Katz, the University of Sydney Business School associate lecturer, told News Australia that nation is uniquely poised to become a leader in the global medical cannabis industry. The nation has strong environmental laws that can protect the purity of the product. At the same time, an equally formidable law-and-order structure can keep away the criminal elements usually associated with the product. Finally, Australians themselves are expected to consume about 800kg of medical cannabis during the first year of legalisation. Drugs manufactured from the plant are being used to treat conditions like cancer, epilepsy, chronic pain and multiple sclerosis.
Meanwhile, about US$50 million (AU$65.6 million) from US investors have already been poured into Israel’s medical cannabis industry, according to Forward. The number is expected to increase to US$100 million (AU$131 million) by the end of the year. Israel, which has licensed the manufacture and use of medical marijuana since the late 1990s, will use the funding for more extensive research about the plant and subsequent products, the creation of cannabis tech hubs, and the cultivation of related industries like inhalers and transportation.
Israel’s global positioning in cannabis-connected sectors is another reason why American investors are being drawn in. Jeffrey Friedland, CEO of US investment firm Friendland Global Capital, said, “Israel is a leader in agriculture. Take that and couple it with research – you have the two sides: plant science and pharmaceutical development.”
Medical marijuana producers in Canada are also eager to address longstanding myths about the product in order to capture a huge share of the international market. Helping them are US investors who are also heading off to their next-door neighbour to provide them seed money for research and start-ups. One advantage that Canada has is that the medical cannabis drugs can be accessed legally. With the support of American firms, Canadian cannabis producers believe that their country has a good chance of becoming a global leader, according to CBC News.
The promised land of a thriving medical cannabis industry is drawing in confident investors from all borders. As projected profits grow, so will prospective investors. Right now, Australia and Israel are parting the waters for others to follow, guided by a glory cloud of billions of dollars in profit.
