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European Cannabis Q1 2024 Quarterly Update

May. 31, 2024 by SOMAÍ Pharmaceuticals

2024 ushered in one of the most reformatory changes that the global medical cannabis community has ever witnessed. The EU market received a massive spotlight on the potentially explosive growth coming and the much-needed injection of investors entering back to the sector.


The first major shift that was announced came for the US HHS/FDA who begrudgingly released a 252-page report declaring that cannabis was not only safe but also good for at “least” 15 indications. This is the first time that any major and especially the biggest health regulatory agency in the world has reversed course and made a declaration of its kind. The HHS sited studying the results of 6,000,000 patients and 30,000 prescribing physicians when drawing the conclusions as to the safety and benefits of cannabis. 

The second major shift was the country of Germany passing and implementing their first pillar which amongst other things removed cannabis from the list of narcotics. The impact on doctors being able to prescribe cannabis freely with no stigmas and rules around narcotics distribution was felt immediately with a surge in prescriptions and demand. In addition, other European countries that will follow similar or at least more medical paths has started and will likely continue exponentially.

The third major shift, which is still ongoing, was started by the HHS sending a letter to the US DEA to reschedule cannabis from Schedule I narcotic which means no medical benefit to a Schedule III. The President and Vice-President have regulatory touted the shift and have recently put the final decision in the DOJ for a legal opinion guided by the science and findings of the HHS. The shift from DEA to DOJ is not surprising since the DEA most likely doesn’t want to be the agency to reclassify drugs as they are fighting bigger issues like Fentanyl and doesn’t want to mix signals. It seems highly likely that the US will reschedule given the administration is pushing for the DOJ to be the final check mark in the process.

The Latest Countries

The three shifts make up 3 pillars for a global change in regulatory framework around the world. Already 2024 has been met with major announcements from countries that are moving forward with cannabis reform that is “more in line with global standards.” France has declared that they are moving away from the pilot and will begin a full access medical program that is restricted to extracts only and will allow for finished dosage cannabis products to be registered in 2024 for launch in 2025. Spain has also announced that they have moved to public debate for an extract only market that will be geared similar to Germany’s past access as magisterial products for now. And Brazil, another extract only market has opened to not just CBD products but also products containing THC. Czechia has submitted 2 proposals to the government for debate, and the result may look and resemble Germany of today when finally finished. Japan has moved forward with the first reform in 75 years, and by summer or end of year will announce concrete rules that may resemble products like Epidilox as well as CBD products with under 0.2% THC plus non-psychoactive cannabinoids like CBG and CBN. Israel has loosed its rules on prescribing cannabis which has led to a surge in flower demand. And more are expected to be announced this year, especially if the US reschedules and ignites a global regulatory explosion.

M&A and Raises

One of the most significant deal to start 2024 was the Somai Pharmaceuticals acquisition of the Lisbon, Portugal indoor grow RPK Bioscience from NASD-listed Akanada making Somai one of 5 true EU global verticals and only privately held fully owned vertical in the EU. Along with the purchase, Somai Pharmaceuticals raised an additional 4 million euros to complete the purchase and pay down their debt. Avextra raised 3.3 million euros internally to take out part of the Seed Innovations investment, yet still relies on contract manufacturing by a related manufacturing site not completing a real vertical. And there are still a slew of raises going on that have yet to land completed in 2024.

There is much to cheer about starting 2024 and investors are expected to pick up infrastructure investment dramatically. Partially fueled by Germany as an inflection point, but more so all the countries that have and will be opening. Companies like Artemis Growth Partners have teamed up with Tenacious Labs to create what they call “Europe’s Largest Cannabis Investment Platform”. The amount of infrastructure needed to supply Europe, which will be the second-largest cannabis market in the world, is massive. 2025 production could be far lower than the demand as it may take years to get new supply online, worrying insiders that lower-quality products will flood the market to fill the gaps. Investors see the potential growth of Europe that will be the second largest cannabis market and early investors are getting a much need valuation boost with these inflection point achievements like Germany.