It is no surprise, that cannabis sector experienced a huge growth in recent years. While people used to be afraid of even mentioning the word cannabis, today we can witness an open discussion about its diverse medicinal potential. Medical cannabis is on a brink of a great transformation. Evidence of its many health benefits keep stacking up. Furthermore, interests of the global pharmaceutical industry in the sector are also growing. Most of the time, pharmaceutical companies have watched the development from the sidelines. However, the takeover of the sleeping giant is becoming ever more intensive, with more and more patents and critical trials sponsorships. What do cannabis and big pharma have in store for us – the inconvenient truth.
While better accessibility to cannabis and cannabis products is beneficial for most people, there is one group, which is not particularly happy about it. The pharmaceutical industry. How much does the cannabis market popularity really affect Big Pharma? Are we really witnessing a battle of cannabis against the pharmaceutical industry? Read about the details in this article.
WHO ARE BIG PHARMACEUTICAL COMPANIES?
When we talk about Big Pharma, we are referring to the largest pharmaceutical companies worldwide, which are especially influential when operating in a group. Below are the 10 largest companies (by market cap) and their total value amounts to more than the nominal GDP of South Korea.
Furthermore, many mergers and acquisitions occurred between the pharmaceutical companies. For example. Novartis and Tilray partnered to start the development and distribution of medical cannabis worldwide. MedMen took over a cannabis retailer PharmaCann in a stock transaction worth around $682 million. Company Aurora Cannabis took over a Mexico City based pharmaceutical supplier Farmacias. With it, they gained access to a 130 million people THC medical cannabis market.
Moreover, the merger of Bayer and Monsanto worth around $66 billion can greatly affect the cannabis industry, as huge investments in growth chemicals R&D can have a great effect on the products. Last but not least, we should mention GW Pharmaceuticals, who developed Epidiolex, the first prescription FDA approved medicine based on cannabinoids. As it seems, cannabis and Big Pharma are diving into the joint future of drug development.
IS CANNABIS A THREAT TO BIG PHARMA?
At a first glance we could assume, that cannabis does not have even a slight chance of affecting such a dominant industry. However, a pattern of hostile behavior from the pharmaceutical companies towards positive trends and growth trends in the world of cannabis is noticeable. This includes active lobbying against legalization activities in certain countries or just a general opposition towards its growth. Further legalization of cannabis could cost pharmaceutical companies of about $4 billion annually.
Most prescriptions (by value) are issued for the below medical conditions (can differ by country):
In treating conditions mentioned above, cannabis is very successful. On average, drug prescriptions for conditions mentioned above decreased by 11% (substituted by cannabis). This amounts to approximately $4.9 billion. Due to the fact that cannabis presents a great threat to the market share of pharmaceutical companies, it is very likely they will intensively start to enter the market.
Moreover, it is a fact that pharmaceutical industry gained a negative reputation in recent years. Even societal trust in Big Pharma is at an all time low due to multiple reasons, from price growth, to lack of research transparency. Many suggest that the path for return is paved with cannabis. Big Pharma is working hard on development of various synthetic cannabinoids. With it they are trying to take control over the release of cannabinoids on the medical market.
A Few Examples
For example, Inysys, a large pharmaceutical company created a synthetic cannabis substitute called Syndros. It is a bit more than a variant of Dronabil, shaped to mimic the effects of THC, one of the primary cannabis cannabinoids. Other companies are working on similar products. They launched Marinol and Cesamet, which are two other common substitutes of THC approved by FDA for human use.
“The fact that pharmaceutical companies are very eager to invent and sell cannabis substitutes, while lobbying against the use of natural cannabis, clearly represents their true agenda and motivation for their actions”
However, there are various studies (you can find one here) showing, that the use of synthetic cannabinoids increases the risk of developing serious psychiatric and medical conditions, as well as increased risk of side effects.
With other words, it seems that using natural cannabis is much better compared to its synthetic alternatives. Then why do Big Pharma have such great interest in cannabis? What is the relationship between cannabis and Big Pharma?
HOW THE CANNABIS INDUSTRY AFFECTS BIG PHARMA
All the hostility coming from the pharmaceutical industry can be explain as soon as the effect of cannabis on its product sales revenues are reviewed.
In Bradford AC and Bradford WD study, researchers found that after medical cannabis legislation laws are enforced, drug prescription patterns change. Before legalization, all sorts of different drugs were prescribed, many opioids and other commercially accessible drugs as well. After legalizing medical cannabis, the share of these drugs reduced drastically.
Doctors were eager to prescribe cannabis as a natural source of pain mitigation and treating other conditions, as an alternative to more expensive, potentially harmful commercially accessible products. The reason why doctors commonly displayed behavior like this, is connected to the fact, that patients could easily pick up his or her medical cannabis and required only the advice regarding the strain.
Furthermore, even if the patient is prescribed a specific strain from a specific institution, it would still be much cheaper compared to the purchase of prescription drugs. The study found that the savings in the US states where medical cannabis laws are in place, amount to $165.2 million annually. All due to the fact there is no need to prescribe expensive drugs.
Another study published in “Journal of American Medical Association of Internal Medicine” concluded, that the opioid overdose share decreased by approximately 24% in the states where medical cannabis is legal.
Although, it is always problematic to assume that causality equals causation, currently it seems these results not only suggest that people were prescribed medical cannabis instead of opioids, but they also freely chose cannabis instead of stronger, more dangerous drugs/medication.
SO, WHAT IS BIG PHARMA GOING TO DO?
Maybe some of you got worried regarding the future profits of the pharmaceutical companies, as cannabis will be taking some of the market share. Or that they might not develop new drugs due to the lack of financing.
Do not worry too much, as Big Pharma are one of the largest and most influential players in the world with billions of dollars in profits. There is no worry about lack of new project financing. What we have to worry about though, are their actions, which are trying to stop the growth of medical cannabis. Although, they made their standpoint and fight against medical cannabis very clear in the past (large donations to anti-legalization campaigns), they have been simultaneously trying to develop competitive products, synthetic cannabinoids.
They targeted people who would like the benefits of cannabinoids without the psychoactive effects and social stigma regarding cannabis use. Synthetic cannabinoids such as Marinol or Cesamet aim to compete with the sales of natural cannabis.
Of course, there are times, where folklore and wisdom win against the wishes of large corporations. Cannabis is used by people around the world for millennia for recreational pleasures and medicinal purposes.
“When the ancients used cannabis, they used the whole plant”
One of the key differences between synthetic cannabis products and natural cannabis is the fact, that cannabis contains a larger variety of more complex cannabinoids (rather than solely CBD or THC). For example, it also includes THCA, CBN, CBG, just to name a few. Natural cannabis is also accompanied by diverse mixture of terpenes, which are responsible for the specific taste and aromas, that also have many health benefits.
All these ingredients are combined in a unique experience, which makes natural hemp consumption a healthier medical experience, which synthetic cannabinoids cannot offer. Furthermore, additional advantage is that cannabis can also be grown at home (where it is legal).
This means, that if we develop a medical condition treatable by cannabis, we are not dependent on pharmaceutical companies and their pricing strategy. We could simply grow our own plants. Whatever the pharmaceutical companies will be trying to do against the rise of cannabis, it is very likely they will come out defeated. Well, even the US national war on cannabis could not stop the rise of cannabis – it only slowed it down a bit. Maybe cannabis and Big Pharma can at least create a mass awareness of the acceptability of this plant.
THE FUTURE IS GREEN
The idea of one of the largest industries fighting against a plant seems a bit ridiculous. Can a simple plant really represent such an enemy to one of the largest profit makers on the planet?
With the rise of recreational, medical cannabis and its legalization, people can treat many health conditions effectively, without larger side effects, and relatively cheap. While in most cases cannabis is completely harmless and many accept it as nothing more than a recreational activity, it actually represents an important ideological change. Instead of being dependent on large companies, people can use the proven practices of a simple plant with years of history and knowledge it brings with. While pharmaceutical industry is not going anywhere, cannabis absolutely presents an important competitor for those who are trying to make money on the expense of others health.
Cannabis can be just a plant with a few fun effects and useful medical properties; however, it is quickly becoming much more than this. We will have to wait for a bit more to see, what cannabis and Big Pharma really bring us in the future.