In interviews with life science specialists around the world, one topic that continued to come up was cannabis. Some practitioners report, “Medicinal cannabis and CBD are very hot topics, and are only increasing in popularity.” Others, inviting comparison with blockchain, say: “Cannabis is simply hype – it has come and will soon pass – and merely benefits from being less regulated than medical devices currently.”
Data currently undermines the sceptical voices in the market, as it shows that the cannabis industry is one of the fastest-growing in the US, having almost doubled its size in the past four years with 243,700 jobs. As of 2018 it is worth an estimated $10.4 billion and is predicted to reach $32 billion by 2022. With legalisation sweeping 34 American states and Canada, as well as large trial schemes of medical marijuana in the EU, it seems that cannabis is set to remain an area of intense activity for lawyers. For example, as practitioners report, “Companies from Canada and other countries are attempting to enter the Colombian market to obtain licences in order to mass produce cannabis, due to the excellent weather.” As such, law firms are developing specialised practices in “advising cannabis companies on the highly regulated process of obtaining growing licences, and helping clients export this cannabis to countries such as Australia and the USA”.
However, like many markets in their infancy, it is still something of a wild west. After the “green rush” of legalisation in the US and Canada in 2017 and 2018 respectively, stock prices have been volatile, with 2019 being particularly challenging. There have also been widely reported supply issues in the global market, perhaps partly explained by the “legal lag” effect where regardless of legalisation there is a delay in establishing legal and supply chain infrastructure to support the sector. This in turn produces a shortage in legal cannabis supply and can drive up prices: in Canada, black market cannabis currently trades at C$6.51 per gram, while legal cannabis is priced at C$10.65. The “legal lag” effect will potentially put further strain on markets in the US and Canada as the likes of the European market rely on importing cannabis. Corporate immigration and trade specialists report that it can be difficult for those employed in the legal cannabis sector to secure visas for the USA. Going forward, it will be an area to watch for law firms looking to offer a diverse range of services to a rapidly growing and profitable sector.