UK Cannabis Market – Business Plan Templates

Legalization

A licence is required to cover both cultivation and possession in the UK legal cannabis market.

Medical Cannabis

In June 2018, the UK government announced a review of cannabis-based medicines. The government considered licence applications for the use of cannabis-based medicines but only in ‘exceptional cases’ where there is an unmet clinical need.

On November 1, 2018, the medicinal cannabis was re-assigned to Schedule 2 and specialist clinicians can legally prescribe cannabis-derived medicinal products to patients with an exceptional clinical need.

NHS guidance states that a decision to prescribe cannabis products would only be considered where other options had been exhausted first.

Cannabis is a Class B controlled drug under Part II, Schedule 2, of the Misuse of Drugs Act 1971 (MDA 1971). It is also listed in Schedule to the Misuse of Drugs Regulations 2001 (MDR 2001) and designated under the Misuse of Drugs (Designation) (England, Wales and Scotland) Order 2015 (2015 Order). As such, it is unlawful to possess, supply, produce, import or export this drug except under a Home Office licence. It is also an offence to cultivate any plant of the genus Cannabis except under a Home Office licence.
Each grower must be individually licensed.

CBD Products

Most cannabis-derived products are controlled substances under the Misuse of Drugs Act, but some types of CBD oil are legal to sell as health supplements. CBD oils approved for sale in the UK must not contain more than 0.2% of THC, the chemical responsible for the ‘high’ effect.

The legislative controls identified above apply to cannabis plants cultivated for the production of drug material (e.g. hemp fibre or oil). Cultivation or possession of cannabis plants cannot lawfully be undertaken without the requisite Home Office Licence.

Licences are granted to enable the use of non-controlled parts of the plant (i.e. seeds and fibre/ mature stalk only) and the policy does not allow for use of ‘green’ material- i.e. the leaves and flowers as these are controlled parts of the plant.
The Home Office only issues licences for cultivation of plants from approved seed types with a THC content not exceeding 0.2%.

UK Medical Cannabis Market

Cannabisbased products for medicinal use e.g. Tilray and Bedrocan products that were supplied under a Home Office (HO) licence, Schedule 2 (Cannabis-based products for medicinal use as defined by the change in regulations on 1st November 2018)

Constituents

A range of preparations containing delta-9-tetrahydrocannabinol (THC) and cannabidiol (CBD) with differing percentages of the active constituents. The product to be specified by brand/supplier; cannabis strain and content of THC/CBD (and ratio of THC/CBD where relevant), as appropriate.

Licensing

Unlicensed specials.
Suppliers should comply with MHRA guidance and Good Manufacturing Practice standards.

Indication

Available on a named patient basis for indications where there is clear published evidence of benefit or UK Guidelines and in patients where there is a clinical need which cannot be met by a licensed medicine and where established treatment options have been exhausted.

Which clinicians can prescribe?

Specialist doctors on the GMC specialist register only can take the decision to prescribe.

In 2019, the UK launched a registry study Project Twenty21, aiming to monitor the health outcomes of 20,000 patients using cannabis based medicinal products by the end of 2021. The project gives access to medical cannabis for patients living with:

Anxiety Disorder
Chronic Pain
Multiple Sclerosis (MS)
Post-Traumatic Stress Disorder (PTSD)
Substance Use Disorder (as a harm reduction strategy)
Tourette’s Syndrome.

The drug has only been prescribed to an estimated 25,000 patients since it was legalised for medical use. The Department of Health and Social Care estimates that as many as 3 million patients with chronic pain could be eligible for cannabinoid treatments across the UK.

In March 2023, Celadon Pharmaceuticals became the first British medical cannabis manufacturer to be licensed by the Home Office to sell its products in the UK after its 100,000 sq ft manufacturing facility in Birmingham was granted a Good Manufacturing Practice registration by the UK’s Medicines and Healthcare products Regulatory Agency in January.

A new report from New Frontier estimates that there can be about 4.2 million cannabis users in the UK, contributing to a forecast potential market value of up to £3.9 billion per year.

The UK Cannabis Report from Prohibition Partners predicts the UK legal cannabis market to reach £4.3 billion by 2024 while medical cannabis market is predicted to be worth more than £1 billion, servicing over 300,000 active patients.

The UK Cannabis Market Infographics

UK Hemp/CBD Market

The agriculture industry in the UK has started to recognise the increasing value of hemp as a crop and is expected to increase output and processing capabilities by 200% in the next 5 years.

In hemp varieties grown for seed or fiber use, the plants are grown very closely together and a very dense biomass product is obtained, rich in oil from the seeds and fiber from the stalks and low in THC content.

Much of the hemp grown in the UK in recent decades has been used in the building & construction industry, in a variety of forms, mainly as non-structural building materials and wall insulation. The natural insulating properties and astonishing durability of hemp make it a viable alternative, in terms of technical quality, to traditional materials.

The global CBD industry is projected to accelerate from $9.3 billion in 2020 to $23.6 billion over the next five years, at a CAGR of over 20% during the forecast period, according to Grand View Analysis. In the UK, the number of people using CBD oil is estimated to have reached around 300,000. The Cannabis Trades Association UK has estimated that UK CBD use has doubled in a year. Although CBD, making medicinal claims, needs to receive a marketing authorisation from the MHRA, many companies have set of CBD companies categorised as food supplements.

According to the recent report by the ACI (Association for the Cannabinoid Industry) and the CMC (Centre for Medicinal Cannabis), the CBD industry within the UK was estimated to generate annual revenues of approximately £690 million in 2021.

Cannabis Testing Business Plan Sample, the UK

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