A Q+A with H+K’s Cannabis Experts Omar Khan and Ivan Ross Vrana
Is cannabis legal now?
IRV: The Cannabis Act (Bill C-45) has passed in the Senate and has received Royal Assent. It is not legal yet to buy, possess or use cannabis for anything other than authorized medical or research purposes. We are currently in a transition period to allow the federal government, the provinces and territories, the regulated industry and law enforcement to prepare for legalization.
On June 20, the Prime Minister announced that cannabis will be legal in Canada on October 17, 2018.
How will cannabis be sold to consumers across the country?
OK: Each province has established their own model for selling cannabis. Ontario and New Brunswick plan to sell cannabis through government run stores but the incoming Premier of Ontario has indicated he is open to exploring private delivery models. Cannabis sold in Alberta and Manitoba will be through private-sector retail outlets. BC is looking at a hybrid solution of both government-run and private-sector retail and Quebec is looking at government-run outlets with some exceptions.
Will the model for selling cannabis in Ontario change with the new Progressive Conservative government?
OK: Leading up to the Ontario election, H+K conducted proprietary research and found that nearly two thirds (62%) of Ontarians prefer a government run model, as currently planned with the Ontario Cannabis Store (a subsidiary of the LCBO). Those under 25 and ages 25-34 were the most in favour of a free-market approach, though still favoured government run (<25: 42% for free market, 58% for government run; 25-34: 46% for free market; 54% for government run). This will be interesting to watch in the coming months as the new Ford-led Conservative government have said they will look at room for private sector involvement. The Ontario Cannabis Store has only signed two leases so far of the 40 proposed initial retail locations. It is possible that the incoming government will put a hold on further lease signings while they consult with their caucus about which approach they intend to take with respect to distribution.
When will the stores open?
OK: We understand that the provinces are working towards having everything ready and stores to open on the day cannabis becomes legal, which Trudeau announced to be Wednesday, October 17, 2018.
What is the difference between this recreational cannabis and the already legal medical cannabis?
IRV: This depends on how one intends to use the product – is it for medical or recreational purposes? Depending on the condition or ailment, cannabis can be used for medical purposes – however, there is still a lot of research that needs to be completed and undertaken which outlines the benefits and risks. Generally, (but this is not a hard rule) cannabis for medical use tends to have high CBD content while recreational cannabis can have higher levels of TCH, which is the main psychoactive component of cannabis
In what format will cannabis be sold?
IRV: When cannabis becomes legal, only dried flower and oil will be sold. However, as per the Cannabis Act, regulations supporting the production and distribution of infused products (e.g. edibles, beverages, creams) will be in place by the end of 2019.
What will the economic impact be for Canada?
OK: Canada’s cannabis market will pass $7 billion by 2019 and legal sales will make up more than half of that amount, according to a report this month by Deloitte. Several provinces are working on economic development strategies focused on building their cannabis sectors. Apart from trying to attract cannabis producers, many provinces are focused on the broader supply chain of value added jobs. These include jobs associated with intellectual property, clean tech, secure transportation and packaging.
As the government works to bring in regulations to legalize infused beverages and edible products, the consumer market for this product will only continue to grow.
How does H+K help organizations that are trying to navigate this new market?
IRV: Since 2013, our integrated team of experienced policy and communications professionals have been helping dozens of Canadian companies successfully navigate the increasingly complex regulatory, social and political environment in which they seek to operate and build their brand.
We have a deep understanding of the regulatory landscape. We are speaking to the licensed producers, government stakeholders, and cannabis beat media every single day. Not only that, but we have experience anchored in getting results within a regulated framework.
Our roots are in strategic communications and when you combine H+K’s long-standing heritage and gravitas with some of the most creative and smart minds in the industry, we bring you the expertise and knowledge that can influence stakeholders and drive purchase decisions.