Future of Cannabis Industry in Australia
The Cannabis industry in Australia is still in its infancy but this does not mean that it does not have a promising future. Australia is one of those countries that have legalised medicinal cannabis and is yet to legalise cannabis completely. Certain obstacles stand in the path of Australia before cannabis can be legalised completely and these obstacles are also the reason why the Australian cannabis industry cannot fully realise its growth potential.
The first obstacle in the way of the cannabis industry in Australia achieving its full growth potential is public opinion. The recent referendum in New Zealand came out against cannabis legalisation and this has to a very great extent dented the hopes of complete legalisation of cannabis in Australia as well.
Although both countries are not the same but outcome of the referendum in New Zealand will have an impact on the decision making of the Australian public. As long as there is not widespread approval and acceptance for cannabis, the industry cannot grow at its true potential.
Australia, therefore, needs to focus on shaping public opinion before going for any referendum. This however does not affect the medicinal usage of cannabis in any manner.
The biggest obstacle in the path of the cannabis industry realising its true potential in Australia is the lack of infrastructure. The medicinal cannabis industry is relatively new, research on medicinal cannabis and its uses is still in its early phase and new products are being discovered, developed and patented every day.
This means that there is a need for the development of infrastructure before true growth potential for the cannabis industry can be realised. The medicinal cannabis industry needs proper infrastructure. To start with it needs proper research labs, sanctions, research and development costs and all the support that the government can offer. There is a need to create interest in medicinal cannabis to attract more researchers and start a small ecosystem that can sustain itself over time.
Secondly, the medicinal cannabis industry needs supply chain and logistic issues to be sorted out. From the research lab to the factory to outlets that are easily accessible for the consumers. Doctors need to be informed about the uses of cannabis-based medicines so that they can prescribe those to the patients. Pharmacies need to have cannabis-based medicines with easy access. In other words, cannabis-based medicines need to be as accessible as Aspirin.
Setting up this supply chain will require public-private partnership projects, which can only happen with the support of the government.
Another obstacle in the path of the cannabis industry realising its true potential is the lack of favourable legislation and red tape measures. Although the government has taken steps to legalise medicinal cannabis there are still too many red tape measures that are slowing down the process.
To start, the costs of obtaining a license for medicinal cannabis is too high. This cost serves as a barrier to entry for the smaller firms. As of now, the cost is so high that only the big players in the pharma industry can go for the licenses.
Secondly, the process of issuing the license takes too long, which is hampering the growth of the industry. Some experts think that these red tape measures are intentional as the government wants to buy time to create the required infrastructure before making it easier to obtain the license. Other experts believe that these steps are only hindering the growth potential of multi-billion dollar industry.
Australian medicinal cannabis products already have global demand and are being exported to Europe and America. If the government streamlines the process of obtaining the licenses, the industry will be able to grow at a much faster rate.
At present over 90% of the prescriptions and approvals for medicinal cannabis are being supplied by medicinal cannabis products imported from Europe. In 2018, Australia only had 457 who had access to medicinal cannabis, this number grew to 2526 in 2018 and 15556 in 2019. It is expected that over 70,000 people need to have access to medicinal cannabis in 2020.
These numbers suggest that the medicinal cannabis industry is not just booming but there is great potential for future growth as well. The imported products are right now taking the lion’s share of the local demand, this is simply because the international products that come from the USA, Europe and Canada are far more advanced than the products available in Australia because these countries have better infrastructure for this industry.
If Australia can successfully develop infrastructure and remove the barriers that we have discussed above, it can achieve its true growth potential for medicinal cannabis and turn it into a multi-billion dollar industry.
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