It’s nearly six years since Canada legalized marijuana for adult use. This study delved into the impacts on the country’s medical cannabis market.
Where US states have legalized recreational marijuana, it’s often been accompanied by an exodus from their medical cannabis programs. And Canada is no different.
According to Brock University’s Associate Professor of Operations Research Michael Armstrong, many patients left that country’s program – but that wasn’t necessarily a bad thing.
“It might partly have represented a ‘right-sizing’ of the system, with some people exiting who maybe shouldn’t have been there in the first place,” he said. “The data also shows patients who remained in the medical system stabilized their purchasing rates and increased their purchase sizes, suggesting there is still a legitimate appetite for a medical cannabis system.”
For his research, Ass. Prof. Armstrong examined Health Canada data covering 2017 – 2022. It indicated registrations began changing in July 2018, immediately after the law was passed, but a few months before it came into effect. The biggest change noted was after products such as edibles, beverages and vapes became available in late 2019. But while registration numbers also fell markedly during this time, the frequency of purchases became more static, and the amount purchased per order grew.
To boost the country’s medical program, Armstrong says if the excise tax or sales tax on medical cannabis was ditched, it could make it more attractive – as would making it available at local drugstores; which would also provide access to a pharmacist and advice. Medical cannabis produced and sold in Canada has the same excise duty as recreational marijuana and is subject to full GST.
According to Health Canada, the number of medical client registrations with federally licensed sellers was 345,520 the month legalization came into effect. In March this year, it had plummeted to 180,878, well down not only on pre-legalization, but the 212,700 in March 2023.
As for other jurisdictions introducing legal recreational marijuana, Ass. Prof. Armstrong offers this advice:
“Simply put, the message would be that you should expect big changes to your medical market after legalization, but you shouldn’t expect it to suddenly disappear, and that partly depends on variables like the product selections you have and how competitive the two systems are.”
The Brock University research has been published here.
