COVID-19 Highlights Need for Domestic Cannabis Industry in the UK
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COVID-19 Highlights Need for Domestic Cannabis Industry in the UK

Cannabis activist and consultant Mike Barnes says demand has remained steady in the UK’s nascent medical cannabis market, but supply chain challenges threaten to disrupt patient access.

April 17, 2020

The United Kingdom’s medical cannabis industry took great strides forward at the beginning of the year as the first cannabis clinics opened their doors to patients, but the global COVID-19 pandemic has caused supply chain challenges that highlight the need for a domestic cannabis industry, according to Mike Barnes, cannabis activist and founder of England-based Maple Tree Consultancy.

The UK’s medical cannabis law took effect Nov. 1, 2018, and allows medical specialists to prescribe cannabis to patients with any condition, although general practitioners and primary care doctors are not permitted to write medical cannabis prescriptions.

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The industry remained dormant for much of 2019 due to these restrictions, Barnes says; by the end of last year, there were only a few doctors in the whole country that were prescribing medical cannabis, and the medication was quite expensive.

At the start of 2020, private cannabis clinics began opening with government approval, which seemed to kickstart the program, Barnes says. Roughly 100-150 new patients were receiving medical cannabis each month, compared to 2019, when only a few dozen prescriptions were written over the course of the entire year.

“Compared to the States and Canada, we’re still way behind, but it is picking up slowly but surely, and the price is coming down,” Barnes says. “It’s now about a third of the price from when we started, so we’re making some progress—very, very slow progress, but we are making progress. … That’s where we were when COVID-19 came along in March.”

Barnes, a neurologist, became interested in cannabis roughly 20 years ago when he was diagnosed with multiple sclerosis. He worked with GW Pharma in the early 2000s to develop the company’s first cannabis drug, Sativex. Barnes later worked to compile a report for the UK’s government on the efficacy of medical cannabis.

Barnes now operates a chain of three clinics based in London called the Medical Cannabis Clinics, and he was unsure how the COVID-19 crisis would impact the cannabis sector at the start of the pandemic.

“It’s very delicate, in a sense, so we thought this would have a very bad impact on us,” he says. “I thought it was a bit worrying. We have 11 doctors prescribing at the moment through our clinics [and] that’s all. There are probably about 20 doctors prescribing throughout the whole country at the moment—that’s it.”

Now roughly a month into what has become a worldwide crisis, Barnes has identified some of the impacts that COVID-19 is having on the UK’s cannabis industry.

For starters, he says, patient demand on the clinics has remained steady, and Barnes’ clinics have actually become more efficient since they are now allowed to consult with patients via telemedicine, which was previously prohibited.

“That’s helped because some of our patients are quite disabled and it’s difficult for them to travel to London, so seeing them in their own home over the computer has been helpful for them and helpful for our doctors, of course, because they don’t have to travel to London [to commute],” he says.

The COVID-19 crisis has also caused supply chain challenges that threaten to disrupt patient access, but that also might spark regulatory changes leading to a domestic cannabis industry in the UK, Barnes says.

Currently, the UK is an import-only cannabis market, and every prescription product must be imported from Canada, Israel or Holland, although the country is also looking to import products from Australia in the near future, Barnes says.

“We’re very dependent on the supply chain,” he says. “The problems we’ve had is that COVID has impacted the flights and the importing.”

In recent weeks, one of Barnes’ Israel-based suppliers had trouble getting product out of the country due to reduced staff working in the Israel Ministry of Health. Ultimately, Barnes had to contact the Minister of Health directly to request that he sign off on the required export licenses in order to get the product to the clinics and in the hands of patients.

“They got the medication for the children [with] epilepsy the day they ran out [of their supply],” he says. “It was that close, so that could have been a problem if the children had run out of supply.”

While some industry stakeholders have been advocating for a licensed UK medical cannabis industry since the program’s inception, the government has been slow—and perhaps reluctant, Barnes adds—to act.

“I think there were signs before the COVID crisis that they were speeding things up and changing their minds a little bit, and I think this will speed it up even further,” he says. “I think we might get a UK-based cannabis industry, but in the short term, the problem is the supply chain from abroad.”

In addition, as in other parts of the world, the pandemic has reduced the availability of capital, which could spell doom for some of UK’s cannabis startups.

“Several of our little cannabis companies are in the startup stage and not yet making a profit,” Barnes says. “[They] are in need of investment to keep going until they do make a profit, and the investment money is drying up because of COVID. I think more cannabis companies and hemp companies will be bankrupt as a result of the crisis, and I think it’s the same in the States and Canada, that the investment money is not there.”

The UK has rolled out economic relief packages that apply to any business, including the cannabis industry, which Barnes says are quite generous and might help cannabis businesses weather the storm.

In particular, the government will pay 80% of furloughed employees’ salaries up to a maximum of 2,500 pounds per month.

“Again, there could be some cash flow issues for companies, but the government is subsidizing those that have been laid off, so that’s one [good] thing,” Barnes says.

Cannabis companies should focus on building an online presence during this time, he adds, to develop online relationships with customers and generate online sales while most of the country is shut down.

Businesses should also be thinking about diversifying their supply chains as much as possible, Barnes says.

“Use the time to perhaps think about different supply chains so you’re not struggling because you’ve been dependent on one supply … that might face importing problems."