O Canada-Part Deux

Those zany Canadians are at it again!  Yesterday, the Canadian government announced that it will invest almost $47 million (Canadian) over the next five years in a cannabis education and awareness campaign.

According to a press release,  the campaign will include “factual and evidence-based information on the health and safety risks of cannabis use and drug-impaired driving. The campaign will build on ongoing social media efforts, advertising and interactive events to engage youth on the facts.”

The goal of the campaign is to provide Canadians, especially young adults and youth, with clear factual information so that they understand how cannabis could affect them.  A critical part of the initiative is to equip parents and teachers with factual evidence-based scientific information so that they can have meaningful discussions with young Canadians about the risks of cannabis use, especially drug-impaired driving.  To that end, this fall, Public Safety Canada will launch an initiative to inform citizens about the dangers of drug-impaired driving.

Because medical cannabis is legal nationwide  in Canada (and recreational use is soon to follow)  making an investment in cannabis education and awareness makes sense.  An informed and educated public ought to reduce some of the anxiety and possible dangers associated with cannabis use.

Perhaps, the US ought to follow Canada’s lead and make similar investments to educate the American public about medical and recreational cannabis use. At present, the amount of misinformation far outweighs the facts. This is extremely troubling since tens of millions of Americans are currently regular cannabis users.

 

Who’s Who In the World of Publicly Traded Cannabis Stocks

While the number of publicly traded Cannabis companies is relatively small, the so-called  US Marijuana Index has been created so that people who invest in the stock market know which companies are worth investing in.  The US Marijuana index is complied by the Marijuana International Corporation.

Unlike high flying biotechnology, tech and healthcare company stocks that trade on major stock indices like NASDAQ and the New York Stock exchange, most of the stock issued by companies that comprise the Marijuana Index is traded on the over-the-counter or OTC market.

At present, the marijuana index has a market cap over $5 billion and is equally weight among 20 companies that have at least 50% of their revenues generated from the cannabis or hemp industries.  A list of the companies and their market caps that comprise the US Marijuana Index can be found here.

As of April 2017, the US Marijuana Index delivered an annual return of 35.6% as compared with the 12.47% returns of the S&P 500 index.  This suggests that investment in Cannabis company stocks may be a good bet.  That said, the uncertainty of the Trump administration’s stand on the legal US recreation and medical Cannabis industries should also be considered (at least for long term investing strategies).

Given the chaos of the Trump administration and Jeff Sessions tenuous job security, many people remain high (pun intended) on investing in the Cannabis industry.  However, like any other stock investment, investment in companies that comprise the US Marijuana Index can be risky and not for the feint of heart!

Commercializing Cannabis-Derived Pharmaceuticals: Legal and Regulatory Challenges

The current regulatory and legal landscape for cannabis and cannabis-derived products is extremely difficult and fraught with numerous challenges. For example, in the US, cannabis and products derived from it (including hemp) are federally classified as Schedule I drugs according to the US Controlled Substances Act (1). This means that cannabis and its products have been deemed to have “no currently accepted medical use in treatment in the US” (heroin and LSD are also schedule I drugs), are harmful and consequently, are illegal (2).

Not surprisingly, its Schedule 1 classification has seriously hindered cannabis research in the US and made it extremely challenging for drug companies developing cannabis-derived pharmaceutical products (3). However, over the past decade or so, 29 states including the District of Columbia have enacted legislation that permits some form of cannabis consumption for medical purposes (4). Yet, despite this, cannabis and products derived from it remain illegal at the federal level and during interstate transport (even between states where medical marijuana has been legalized) is illegal and criminally punishable (2).

The confusion regarding cannabis use at the state and federal levels has given rise to two distinct types of companies that are attempting to commercialize cannabis (and products derived from it) for medicinal purposes. The first of these are commonly referred to as medical marijuana or medical cannabis companies. Typically, products from these companies are botanical extracts or actual plant materials derived from specific cannabis strains with anecdotally-reported medicinal properties that can be topically applied, ingested, smoked or vaporized. Patients require a “prescription” (card) from a state-licensed physician to obtain medical marijuana and it can only be used in states that permit consumption of cannabis for medical purposes. It is important to note, that while a prescription is required for medical cannabis use, these products do not require human clinical testing for safety, tolerability and efficacy (like other prescription drugs) prior to their sale in states where medical marijuana is legal.

In contrast with medical marijuana companies, biopharmaceutical companies including GW Pharma, Zynerba, Insys, Kannalife, Aphios and others (Table 1) are committed to developing cannabis-derived pharmaceuticals using conventional US Food and Drug Administration regulatory approval pathways. UK-based GW Pharma is the clear leader in cannabis-derived pharmaceutical space—its flagship product Sativex®, a plant extract, has been approved as a treatment for cancer-related pain and MS spasticity in 27 countries outside the US (5).

While the business case for developing pharmaceutical cannabis-derived pharmaceuticals is a sound one, the time and cost necessary for regulatory approval will be much greater than that for commercializing medical marijuana. At present, the United State Food and Drug Administration (FDA) has signaled a willingness to review new drug applications for cannabis-based pharmaceuticals (6). However, the agency has yet to issue definitive guidance for regulatory approval of these products and to date has not approved any application for cannabis-based products (6). Nevertheless, garnering FDA regulatory approval for cannabis–derived pharmaceuticals may offer several competitive advantages over numerous medical marijuana products that currently dominate the US market.

First, the average cost per patient of Sativex® to treat MS spasticity in countries where it has been approved has been estimated to be roughly $16,000 (6). Several studies indicate  (7, 8) that the high price of Sativex® will make it unlikely to be considered cost effective by regulators in countries with government-mandated national formularies like the UK, Ireland and Australia. However, this should not be an impediment in the US market because the federal government does not set drug prices and third-party payers dictate formulary placement and set drug reimbursement rates.

Second, unlike medical marijuana (which as previously state is a Schedule 1 drug), FDA approved cannabis-based pharmaceuticals like dronabinol and nabilone have been classified or reclassified as Schedule 2 (opioids) or Schedule 3 (codeine) drugs (5, 9). Federal regulators are likely to apply the same scheduling criteria to the next generation of FDA-approved cannabis-derived pharmaceuticals like Sativex® and others. Rescheduling will effectively allow these products to compete with medical marijuana because unlike medical marijuana—which is legal in only 29 states and cannot be transported across state borders—approved cannabis-derived pharmaceuticals can be legally prescribed, sold and used in all 50 states and US territories.

Finally, and perhaps most importantly, physicians may be inclined to prescribe FDA-approved cannabis drugs as compared with medical marijuana because they have been evaluated in human clinical trials and officially deemed to be safe and effective treatments for specific therapeutic indications.. In marked contrast, medical marijuana can be prescribed and sold in states where it is legal without going through any formal drug review process. While this is unlikely to interfere with possible therapeutic benefits offered by medical cannabis questions concerning product safety, effectiveness and reproducibility about these products are likely to continue to  arise until industry best practices are implemented and standardized.

References

  1. https://www.deadiversion.usdoj.gov/21cfr/21usc/812.htm  Accessed July 17, 2017
  2. https://www.dea.gov/druginfo/ds.shtml  Accessed July 17, 2017
  3. https://www.brookings.edu/wp-content/uploads/2016/06/Ending-the-US-governments-war-on-medical-marijuana-research.pdf  Accessed July 17, 2017
  4. http://medicalmarijuana.procon.org/view.resource.php?resourceID=000881 Accessed July 17, 2017
  5. https://www.gwpharm.com/products-pipeline/sativex  Accessed July 17, 2017
  6. https://www.fda.gov/newsevents/publichealthfocus/ucm421163.htm  Accessed July 17, 2017
  7. Pharmacoeconomic NCF. Cost-effectiveness of Delta-9-tetrahydrocannabinol/cannabidiol (Sativex®) as add-on treatment, for symptom improvement in patients with moderate to severe spasticity due to MS who have not responded adequately to other antispasticity medication and who demonstrate clinically significant improvement in spasticity related symptoms during an initial trial of therapy. 2014. http://www.ncpe.ie/wp-content/uploads/2013/01/Summary-v1.pdf.
  8. Lu L, Pearce H, Roome C, Shearer J, Lang IA, Stein K. Cost effectiveness of oromucosal cannabis-based medicine (Sativex(R)) for spasticity in multiple sclerosis. PharmacoEconomics. Dec 1 2012;30(12):1157-1171.
  9. https://www.deadiversion.usdoj.gov/fed_regs/rules/1998/fr1105.htm  Accessed July 17, 2017

Science Job Opportunities Exist in the Cannabis Industry

According to a recent article, the 2013 to 2014 US market for legal Cannabis (medical and recreational) grew 74% from $1.3 billion to $2.7 billion. Industry analysts predict that the legal marijuana industry is (and will continue to be) the fastest-growing industry in the US over the next 5 years with annual revenues topping $11 billion by 2020.  And, as the industry grows so will employment opportunities.

At present, salaries associated with various job functions in the Cannabis industry range from $50,000 to $90,000. As many businesses that support the Cannabis industry continue to grow, the competition for qualified employed will intensify and salaries will concomitantly rise. Currently,, there aren’t enough trained job candidates to fill the many job openings at Cannabis companies. I am sure that many of you who hold graduate degrees in the life sciences are wondering why I am pitching jobs in the Cannabis industry.

First, traditional jobs for PhD-trained life scientist are getting scarcer and the election of Donald Trump suggests that this trend will not be reversed anytime soon.

Second, consider that growing and cultivating marijuana and extracting cannabinoids (the pharmaceutically active molecules in Cannabis buds) require a background in laboratory methods, chemistry, biology and in some cases plant science. For those of you who may not know, the medical Cannabis market is focusing almost exclusively on cannabis extracts and vaporization of these extracts (rather than smoking) is the preferred delivery methods. This suggests that those of you with backgrounds in biomedical engineering and medical devices  can leverage your expertise and skills to obtain jobs in the delivery side of the cannabis industry.  

Third, the expansive growth and sheer economic size of the Cannabis industry suggests that other jobs that require a life science background are likely to emerge. These include quality control/assurance jobs for strain identification, diagnostic jobs to determine THC levels/intoxication, molecular biology and bioinformatic jobs to continue to explore and unlike therapeutically relevant molecules from the Cannabis genome and synthetic biology jobs to increase cannabinoid yields and reduce production costs. Finally, there is currently a dearth of qualified job candidates with scientific backgrounds to fill entry level grow and extraction jobs in the Cannabis industry.

At present, the industry is mainly dominated by long time Cannabis growers, people who use marijuana on a regular basis and some moxy business people/investors who see an an enormous upside for the Cannabis industry.

Put simply, now is the time to get in on the ground floor of an industry that is exploding and will ultimately become a legal multibillion dollar a year industry. While I’m sure that neither you nor your parents/family envisioned a career in Cannabis, the jobs are there and ripe for the picking (pun intended).