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Health Canada Fires Designated Growers In Favor Of Large Scale Licensed Producers

Health Canada Fires People
Tweed Inc. owner Chuck Rifici (right) and Vice President/General Counsel Mark Zekulin stand inside
an 18,000 square-foot space at the old Hershey Plant that they’re hoping to convert into a
medical marijuana factory. Julie Oliver/Ottawa Citizen.

Economics

Health Canada Fires Designated Growers In Favor Of Large Scale Licensed Producers

In April, all designated growers in Canada are to stop growing medicinal marijuana for their designated patients. These patients will immediately transition to purchasing their medicine directly from Health Canada approved licensed producers.

Licensed producers are large scale operations. There are currently eight large scale licensed producers in Canada.

As expected, prices for medical cannabis have risen from $2 per gram to a range starting at $6 a gram all the way up to $12 a gram. This translates into a higher cost for the patient, as Health Canada does not pick up the tab for medical cannabis. There is a tax exemption as a medical treatment, however.

The idea behind centralizing the grower is that the quality of product will be higher, as a higher level of scrutiny will be placed on the licensed producers by regulatory agencies. Creating a viable business through the growing of our favorite green will also translate into a more scientific process that will ensure a better product for each of the different strains available. These different strains can then be paired with the illness in question.

For example, for arthritis the cannabis that will be delivered will be higher in CBD, as cannabis is one of the best known for its anti-inflammatory propeties. For older patients there are strains with little to no THC.

This is a big experiment handled by Health Canada. With the upcoming MMAR case to be heard before the April 1 deadline, there is no lack of negative opinions surrounding the decision to centralize. The noted increase in cost is one of the biggest points to consider. Other considerations such as supply and quality of product are also bones of contention, as the grass roots growers don’t seem to see any level of skill or faith in the Licensed Producer companies.

If the MMAR case allows designated growers to keep on producing medical grade marijuana, will there be a glut of medical cannabis that cannot be sold? Will the medical cannabis companies be able to compete with the micro-grower? What do you think?

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