Medical pot growers lobby Ottawa to shut down pot dispensaries

Theglobeandmail.com
Jan. 21, 2016
By Daniel LeBlanc

The biggest growers of medical marijuana in Canada want to be first in line when the market for recreational pot opens up, arguing that only they can guarantee a high-quality product that is securely distributed by mail.

The operators of the Canopy Growth Corp. and Tweed Marijuana Inc. want the federal government to shut down the pot dispensaries that are popping up around the country. Instead, they argue, the strictly regulated and licensed firms in the medical field should be the first ones allowed to provide marijuana to recreational users.

The new lobbying campaign is aimed at the top Liberal officials who will devise plans to legalize marijuana in Canada, mainly MP Bill Blair, the former Toronto police chief who is the Trudeau government’s point person on the file.

The firms want Canada to avoid the “wild west” system that exists in some U.S. states, and simply start by expanding the existing model that supplies medical marijuana across the country.

“If the government wants to introduce a controlled system, which they have said they would do, this - or something very similar to this - is the system they will follow,” said Mark Zekulin, president of Tweed Inc.

Located in Smith Falls, southwest of Ottawa, Tweed operates a large medical-marijuana facility in a former chocolate factory. The multimillion-dollar plant is part of a network of facilities owned by the publicly listed Canopy Growth Corp., including one in Mr. Blair’s Scarborough riding.

The CEO of Canopy Growth, Bruce Linton, said his firm produces about 25 per cent of Canada’s supply of medical marijuana.

The Tweed factory is surrounded by fences and razor wire, and includes a vault that can contain 15,000 kilograms of marijuana - worth about $150-million. The thousands of plants in the facility are carefully nurtured, grown without pesticides, slowly dried and tested before being shipped by mail to clients.

Each shipment of marijuana offers a precise percentage of THC and CBDs, the chemicals that offer a buzz but also medical benefits to users.

Mr. Zekulin said recreational users of marijuana deserve the same level of quality as medical users, given the Liberal government’s promise to “legalize, regulate and restrict access” to the drug.

“If you accept as a starting point that you should have secure production, traceability, and keeping it away from criminal elements and out of the hands of children, then you can’t have unregulated shops opening on street corners all over the country where the regulation is, basically, ‘Trust me,’” he said.

Canopy Growth has been working since December with lobbyists from Ensight Canada to persuade the government to start the production of recreational marijuana along the same lines as medical marijuana.

They propose that marijuana be sold to adults who are at least 19 years old, arguing that Canada Post, with its ability to check the age of its clients, should be the first distributor. Over time, according to this proposal, the sale of recreational marijuana could be expanded to provincially regulated outlets that already sell alcohol.

The proposal would limit production of legal marijuana to large facilities, leaving out small shops such as the ones in Colorado that sell their own products.

“In Colorado, they started off with a really open system, and now they are looking for ways to contract the system, based on lessons learned,” Mr. Zekulin said. “We don’t have to go through that process. We can move incrementally and then expand the system.”

Tweed Inc. has plenty of room to expand. The current facility has 12 grow rooms, and the capacity to add another 18. The firm sells its medical product - made up of dried flowers or “buds” - for $6 to $12 a gram. It is working to obtain a licence from Health Canada to sell cannabis oil, which is easier to use for many patients.

Under rules designed by the Conservative government, mail is the only legal way to obtain medical marijuana from one of 27 producers that have been licensed by Health Canada.

Federal Health Minister Jane Philpott said on Thursday in Vancouver that mailing recreational marijuana will remain illegal until the legislation changes.

Jamie Shaw, president of the Canadian Association of Medical Cannabis Dispensaries trade organization, said illegal storefront sales of marijuana have bloomed because the medical-marijuana system “needs to be fixed.”

“If you can prove that there’s a better model for patients, and the public at large, than dispensaries, then great we would have to look at that and support that,” said Ms. Shaw, who works for Canada’s oldest dispensary based in Vancouver.

Under rules designed by the Conservative government, mail is the only legal way to obtain medical marijuana from one of 27 producers that have been licensed by Health Canada.

There are roughly 500,000 medical-cannabis users in Canada over the age of 25, according to a survey commissioned by Health Canada. Fewer than 37,000 people were registered under the federal government’s mail-order medical pot system at the end of last November.

That mean illegal dispensaries and compassion clubs are likely supplying between 100,000 and 200,000 patients, while a remaining 300,000 or so people use the black market, cannabis consultant Eric Nash told The Globe late last year.

Ms. Shaw said she could see licensed producers mailing products, both recreational and medicinal, to those in rural areas under-served by dispensaries.

“The reason we’re behind this dispensary model in the first place is because that is the best model that we’ve got to date,” she said.