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Tapping the Multibillion Dollar European Cannabis Market

Image Courtesy of Bill Griffin

On a glorious sunny day in late May, cannabis experts and business leaders converged in the prestigious Barbican art centre in the city of London.

Cannabis Europa was located in and around the “conservatory”, offering an oasis of green within the concrete blocks that make up the architecturally “brutalist” Barbican. You would struggle to find a more fitting metaphor for the cannabis industry within the bureaucratic behemoth that makes up the European Union.

Stumbling EU States

Large cannabis companies are drawn to Europe due to the immense population that shares many demographics with their home territory, which in most cases is Canada. Despite the promising opportunities, Europe is far removed from the bold leaders of the cannabis movement – Canada, Australia and New Zealand. To put it mildly, EU member states are stumbling.

For most products, once you are “in” Europe distribution is a case of building your network and translating packaging. Cannabis does not fall into the “most products” category. It is a controlled substance and is currently illegal in all European member states. As an illicit drug, the European Commission lets member states decide how they deal with cannabis. This buck passing is a hangover of cannabis being added to the UN Opium Act almost a hundred years ago; the result restricts free movement of cannabis within the EU – normally a “free trade” zone.  

European GMP Raises Global Standards

It seems to overcome these restrictions the cannabis industry needs to raise the bar. Bedrocan – contracted by the Dutch government to produce cannabis flowers for its medical cannabis programme 15 years ago – was the first cannabis company to gain full GMP accreditation. A process that took three years, a few new hires with backgrounds in regulations and – in the words of founder Tjalling Erkelens – made ISO9001 feel like kindergarten. George Scorsis, former General Manager of Red Bull Canada and now CEO of Liberty Health Sciences, sees GMP vital to succeed in a global market.

Liam McGreevy, of Elite Healthcare Distribution and Ethnopharm summed things up by saying, “European standards are raising the bar for the rest of the world as companies must meet these standards to operate here.”

Embracing Regulations

The general consensus was that adhering to and even surpassing standards – ones that traditional pharmaceutical companies are not even bound by – can only be good for an emerging industry with certain political “baggage”.

It’s tricky to define how big this potential market is, as there are many products still under R & D and even more yet to be discovered. We are just scratching the surface. A cannabis economy requires a cultural shift in our understanding of medicine, wellness and recreation.

Cannabis-derived products (for human consumption only- ignoring the potential for construction, plastics, feed for livestock, etc) are not simply replacements for established markets, such as beer or sleeping tablets. They blur the boundaries and could possibly fall into new categories which are still in the process of being defined. Nutraceuticals – a fancy way of saying “well-being” – seems a fitting term.

Investors’ interests are being piqued. Canaccord, an established financial services company with offices spanning the globe, has made serious Canadian dollars for its investing clients within the cannabis industry. They are keen to replicate this success and make some serious euros. They are not alone either, as representatives from OurCrowd and Merism Capital were discussing how the medical cannabis industry is undergoing dramatic transformations and offering great upside potential for investors.

Serious Euros

Serious euros are something quite a few European states could use. Take Portugal, for example. Portugal is often held up as a shining example of best practice approaches to drug policy.

Portugal hopes to go beyond satisfying the needs of their domestic medical cannabis market and has eyes on other European member states that are struggling – through one reason or another – to meet their own domestic requirements. Germany has a functioning medical cannabis program, but due to such strict criteria in place for cultivation and processing, they are not going to be able to grow enough cannabis. The solution is to import their medical cannabis from the Netherlands (grown by Bedrocan) or even from Canada (courtesy of Tilray).

Tilray is in the process of completing their first European research, cultivation and processing facility in Portugal. The Portuguese government are currently processing 6-8 more applications for cultivation facilities. Portugal’s limited size caught lobbyists off guard in blocking legislation favourable to the cannabis industry. Portugal wins.

Maybe other sun-soaked, cash-strapped states – such as Greece or Italy – could also benefit from the green rush?

Don’t Forget Patients

This red tape has the greatest impact on the most vulnerable in society. It’s easy to forget the sick when you’re dazzled by funky logos, sexy science, innovative medicinal products and – let’s face it – billions of dollars. While politicians are umming and arring on how to tackle an issue that was never on their agenda in the first place, patients are needlessly suffering. Their apathy is forcing otherwise law-abiding citizens into committing criminal acts.  

As I’ve explored before, Europe’s apathy to cannabis leaves politicians the freedom to put this on hold and wait for more forward-leaning nations, such as Portugal, to define the model they can copy.

Oh, Canada

If they look a little farther, over the Atlantic and up a bit, they will find a fully functioning model in Canada that – although not perfect – seems to be the best on the planet so far. Heck, they even speak French.  

If the European Commission would just implement this model wholesale and force the hands of local politicians, the European cannabis market would not only blossom, it would lead the world. But that ain’t gonna happen, as everyone will simply say their hands are tied.

The best that European member states can come up with so far is to create monopolies – Bedrocan in the Netherlands, GW Pharmaceuticals in the UK and the army in Italy – all of which have their faults and cannot meet the demand with the dynamism and agility we are witnessing in Canada.

Medical Cannabis In The UK

The UK is the world’s largest exporter of medical cannabis-derived products. Unfortunately, they are all produced by one company – GW Pharmaceuticals. The home office, who is responsible for granting licenses for cannabis cultivation and processing, has only ever gotten around to granting the one license. In case that is not bad enough, it is emerging that there are links between GW and the home office. Maybe that hitting that fan will be enough to shake things up with a few more licenses? It seems unlikely that the current government would yield in its nonsensical stance that “drugs are bad, cannabis is a drug, therefore it’s also bad”.

CBD is prevalent in the UK market. So much so that you can buy CBD oil everywhere. That’s the good news, but the bad news is that it’s unregulated and there is no guarantee of the label content claims. In theory, trading standards would be responsible for testing CBD products and pulling bad ones from the shelves. That doesn’t seem to be happening, and the costs for such a crackdown would no doubt deter such action.

Most of the CBD products sold in the UK are derived from industrial hemp containing trace amounts of THC. There are health risks of consuming concentrated oils derived from industrial hemp – which acts as a sponge in cleaning up contaminants in the soil; that’s why it was planted around Chernobyl to remove nuclear waste from the environment. Limiting the amount of THC (to make it legal) also limits its effectiveness of it as a medicine. CBD content in industrial hemp is low compared to strains specifically bred for medicinal use. Again, we loop back to the fact that policies are ill defined around cannabis-derived products. The consumer loses.

Recreational Cannabis In The UK

I was staying a 40 minute bus ride away from Cannabis Europa, in Hackney in North East London. I could smell cannabis everywhere. I could smell it growing in domestic buildings, people smoking or vaping in the streets – and even just emanating from people’s rucksacks on public transport.  

It seems police have a very low priority in busting cannabis growers and consumers – who, in turn, have a low priority to conceal their activities. The result is this: Black market cannabis is readily available. If you “need” cannabis, you can get it and doing so carries few legal risks.  

Some may think this is a good scenario, and maybe things are exactly how politicians would prefer. Cannabis is available – so people don’t feel the need to protest in the streets – but it is still technically illegal so “trouble makers” can be removed when deemed necessary. Conveniently, the politicians don’t have to act as the majority of voters are not demanding it.

Why politicians feel it is politically reckless to embrace an industry that will reduce healthcare costs, free up much needed police funds, make roads safer (due to a possible reduction in drunk driving), reduce unemployment, raise taxes and generally enhance the well-being of their population is an utter mystery.  

Given the facts, full legal cannabis is not a hard sell.


  1. Part of the issue is that in Europe, there is definitely not enough customer/patient-focused information about cannabis. In fact, blatant misinformation still circulates in journalism even when the topic at hand had been proven time and time again. It is the people who put the politicians’ feet to the fire to get the issue to the forefront. Sure there is much money to be made. However, much more importantly, there are many people to save.