## Colombia’s Medical Cannabis Market Takes a Leap Forward: Dry Flower Sales Set to Open Up a New Era
Colombia is poised for a significant transformation in its medical cannabis market. A new decree, set to revolutionize the industry, will finally allow the local sale of dry cannabis flower, benefiting both companies and patients. This move opens the door for a burgeoning domestic market, bringing potential for increased revenue and access to quality medicinal cannabis for those who need it.
While the decree aims to protect smaller producers, it actually prioritizes micro, small and medium-sized enterprises (MIPYMES) based on income, not size. This classification, determined by income, number of employees, or assets, opens up the opportunity for a wide range of companies to participate in the local market. This means that many companies, regardless of size, can potentially enter the market, increasing competition and driving innovation.
Several publicly traded cannabis companies already operate in Colombia, including:
* Avicanna Inc (AVCNF, AVCN)
* Clever Leaves Holdings Inc (CLVR)
* Flora Growth Corp (FLGC)
* One World Products Inc (OWPC)
* Pharmacielo Ltd (PCLOF)
Regulatory Hurdles and Challenges:
While the decree presents exciting opportunities, it also introduces new regulatory hurdles. For instance, the requirement for sanitary authorization for dry flower, similar to a Good Manufacturing Practices (GMP) certification, could slow down the implementation process. Companies currently holding GMP certifications for cannabis derivatives will need to adapt their facilities and processes to comply with the new regulations.
A Shift in Focus: From Exports to Domestic Markets:
For years, Colombian companies have primarily focused on export markets due to the lack of a domestic market. However, as Efraín López, director of Árpez Company and former Ministry of Justice official, points out, international trade has been more challenging than anticipated. Regulations often failed to address realities, and global demand wasn’t as large as expected. This new decree aims to ease some of this burden by allowing the sale of dry cannabis flower locally, creating a new revenue stream for companies struggling in the international market.
Opportunities for MIPYMES:
The decree prioritizes micro, small and medium-sized enterprises (MIPYMES) for the first two years, offering them a crucial advantage in this emerging market. While initially intended to protect small producers, the focus shifted to MIPYMES, classified based on annual income from regular activities, assets, and number of employees. According to López, the income thresholds for MIPYME classification are relatively generous, meaning many companies, even those with significant investments, will meet the criteria. This opens up the opportunity for a broader range of companies to benefit from the burgeoning local market.
Timelines and Implementation:
While the decree is a significant step forward, the implementation process will take time. Invima, the Colombian equivalent of the FDA, needs to update its regulations to allow the registration of dry flower as a finished product. This process will likely require adjustments to existing GMP guidelines. However, the market for compounded formulations could see faster development, with companies meeting specific requirements potentially seeing results within one or two years.
Pharmacies: A New Avenue for Growth:
The decree also presents a growth opportunity for pharmacies in Colombia. Once implemented, these establishments will be able to dispense dry cannabis flower, potentially increasing revenue. This move could lead to increased accessibility for patients and expanded reach for the medical cannabis industry.
Conclusion:
The opening of Colombia’s internal medicinal cannabis market represents a fundamental shift for both companies and patients. While the certification and adaptation process will take time, the potential for growth and innovation is substantial. This decree marks a significant step forward for the Colombian cannabis industry, paving the way for a more accessible and prosperous future for both companies and those seeking medical cannabis treatments.