Chapter 5: The Roots of the Medical Cannabis Industry
5.4. Legal History of Cannabis
By the turn of the 20th century, most of the world’s countries had no laws regulating cannabis.
However, a rising international drug trafficking problem concerning opium brought about debates on cannabis as well. At the first international meeting on the drug trafficking problem in 1909, cannabis was not included as part of the problem, but due to American and Italian political pressure the League of Nations decided at the Hague Convention of 1912 to study the problem of cannabis for the next meeting in 1925.30
American political pressure represents a central reason for the international cannabis restrictions that still apply today. Internal debates during the early years of the 20th century fueled this pressure.
American pharmaceutical companies were divided between those that supported prominent doctors who opposed cannabis as a medicine due to its risk of addiction and those that agreed with the National Wholesale Druggist Association who argued that cannabis was a medicine that had no such addictive effects. In 1906, a legal requirement of proper labelling of cannabis products was implemented under the Pure Food and Drug Act, which was an attempt to appease both sides of the debate by simply reducing the amount of cannabis medicine in circulation.31
Subsequently, throughout the 1920s, several American states prohibited cannabis for non-medical purposes, which can be attributed to the racial tension between Americans and Mexican immigrants at the time. Cannabis was blamed for the rising violence in Mexican ghettos during the Great Depression and this negative association of cannabis was further emphasized when the American media started using the Mexican word marijuana.32
American newspapers conveyed this association to the people, who pressured the Federal
Government to handle the drug problem. This led to the implementation of the 1937 Marijuana Tax Act that prohibited non-medical cannabis in the US and put strict bureaucratic procedures in place for the pharmaceutical industry that limited medical supply of the plant. In 1941, medical cannabis was removed from the American Pharmacopoeia, signaling the beginning of the end for cannabis as a medicine.33
American news reports of cannabis’ negative impact also spread to Canadian newspapers. This had a great impact on the social and political opinions of cannabis, even though no national use had been recorded. As a result, the Canadian Government implemented the 1923 Opium and Drug Act that fully prohibited cannabis.34
39
At the next League of Nations meeting, the 1925 Geneva Convention, nations agreed to limit exports on cannabis, despite the fact that no study on the problem of cannabis had been presented in accordance with the 1912 Convention agreement. This was mainly due to American political
pressure, along with Egyptians, South African and Canadian persistence to pass such restrictions.35 In 1961, the 1925 Geneva Convention was the basis of the United Nations Single Convention on Narcotic Drugs. This Single Convention took a tougher approach to drug control, as it urged nations to prohibit domestic cannabis cultivation for non-medical and non-scientific purposes and to make possession punishable by law. By the late 1970s, almost every nation in the world had prohibited cannabis, even countries that had not signed the treaty. In Europe, The Schengen Agreement put more pressure on EEC member nations to prohibit cannabis, because it called for the harmonization of drug policies.36
Despite such pressure, the Netherlands fundamentally amended their national 1928 Opium Act during the 1970s, in order to distinguish between “hard” drugs and “soft” drugs and to combat drug trafficking.37 This legal change gave birth to a policy of tolerance on personal consumption that continues today.38
The Dutch separation of “hard” and “soft” drugs was based on the “expediency principle” that cannabis use leads to other illicit drug use due to similar availability on the illicit market.39 This principle directly opposes the American theory of the “gateway effect” that had affected American and international drug policies since the turn of the century.40 The gateway theory claims that cannabis leads to other illicit drug use due to its psychoactive and addictive effect that is substitutable by other drugs.41
The polarity between the American and Dutch model of perception was strengthened when the Nixon Administration launched the War on Drugs in 1986.42 This war has continued to be the focus of drug policies into the 21st century, but it is likely to change soon.
5.4.1. The End of the War on Drugs
In April 1998 at the United Nations General Assembly Special Session (UNGASS), member nations vowed to make efforts to create a drug-free world by 2008.43 This failed, since drug problems are still present today.
Consequently, in 2012, Colombia, Guatemala and Mexico urged the UN to rethink their drug policy, because vulnerable communities in these countries were severely affected by the
consequences of decades of failed attempts to reduce the illegal drug industry. The reduction of public health and the increase in drug-related deaths in the South American region were blamed on the War on Drugs. Also the extension of the War on Drug approach, the implementation of Plan Colombia that targeted cultivation, was argued to be a contributing factor to the growing illicit drug markets.44
40
The UN complied with South American requests and moved the date of the decennial UNGASS up two years to April 2016, sparking media-wide claims that the War on Drugs was a failure.45 Even the previous UN Secretary-General, Kofi Annan, who led the 1998 UNGASS, has publicly stated that the war has failed and that international and national drug policies need to be reconsidered.46 New approaches to drug policies have been suggested by several nations. The most prominent country is the Netherlands that allow legal possession and consumption, but restricts the distribution and wholesale of cannabis. The only legal body of distribution is the Office of Medicinal Cannabis, controlled by the Dutch Ministry of Health, Welfare and Sport.47
While Dutch drug policy has become stricter in recent years, an increasing number of countries around the world are loosening their national laws and policies. Since the turn of the 21st century, Portugal, Spain and Uruguay have implemented various levels of liberal interpretations of the Single Convention. Portugal and Spain have legalized drug use to provide more people with
treatment for drug abuse without the fear of being criminally prosecuted, but cultivation and sale are still illegal. In 2012, Uruguay became the first country to legalize cannabis completely, but due to national opposition from pharmacies and 60% of the public, the law is still awaiting
implementation.48
Additionally, the US that spoke for the international ban of cannabis in the early 20th century has since 1998 gradually changed position, as an increasing number of US states are legalizing cannabis, both for recreational and medical use. While the Federal Government still considers cannabis a Schedule I drug with no medical properties, states are by law free to make their own individual drug laws.
Initially, this duality of state and federal laws presented a big risk for medical cannabis companies that legally operated under state laws, as they were in violation of federal drug laws. However, an omnibus bill approved in 2014 now ensures that companies and individuals in states with legal cannabis laws cannot be prosecuted by the US Department of Justice.49 Cannabis thereby remains illegal under federal law, but conflicting state laws are tolerated.
The legalization of medical cannabis is spreading fast around the world. It is supported by medical experts and international organization, but countries and states are widely apart on the question of how to regulate such a legal market.50
The 1961 UN Single Convention still applies to signing nations today and thereby still represents a legal barrier to medical cannabis companies.51 While the Single Convention does recognize that
“medical use of narcotic drugs continues to be indispensable for the relief of pain and suffering and that adequate provisions must be made to ensure the availability of narcotic drugs for such
purposes”, a significant majority of countries still consider any use of cannabis illegal.52
However, there are countries that allow the medical use of cannabis, such as Australia, Canada, Colombia, Chile, Israel, Jamaica, the Czech Republic, the Netherlands, The United Kingdom, Uruguay, and 24 US states and the District of Columbia.
41
In the following, medical cannabis companies within these 10 countries and 25 US states will be analyzed in order to enable the identification of national, regional and international trends of the legal medical cannabis market.
42
Sources and Notes
1 European Monitoring Centre for Drugs and Drug Addiction (2012)
2 Clarke & Merlin (2013); European Monitoring Centre for Drugs and Drug Addiction (2012)
3 Clarke & Merlin (2013)
4 See 5.4. Legal History of Cannabis
5 Clarke & Merlin (2013)
6 With the exception of Antarctica (EMCDDA, 2012)
7 Clarke & Merlin (2013)
8 Ibid.
9 Clarke & Merlin (2013); European Monitoring Centre for Drugs and Drug Addiction (2012)
10 European Monitoring Centre for Drugs and Drug Addiction (2012); Mack & Joy (2000)
11 De Brüin, et al. (2015)
12 European Monitoring Centre for Drugs and Drug Addiction (2012)
13 Hanuš & Mechoulam (2005)
14 Sur Actual (15 March 2016)
15 Clarke & Merlin (2013); Catalano (15 March 2016)
16 De Brüin, et al. (2015)
17 De Brüin, et al. (2015); Basavarajappa, et al. (2008)
18 Mack & Joy (2000)
19 Ibid.
20 Huestis (2007)
21 Böllinger (1997)
22 Ibid.
23 Clarke & Merlin (2013); Mikuriya (2007)
24 Clarke & Merlin (2013)
25 Ibid.
26 Clarke & Merlin (2013); Mikuriya (2007)
27 Clarke & Merlin (2013)
28 Ibid.
29 In 1484, the newly appointed pope Papal Bull of Innocent VIII affiliated herbal healers with witchcraft and medical cannabis with satanic rituals (Clarke & Merlin, 2013)
30 Italy had in 1911 gained territories from Turkey where cannabis was a concern (Böllinger, 1997)
31 Mikuriya (2007)
32 Mack & Joy (2000)
33 Clarke & Merlin (2013); Mikuriya (2007)
34 Böllinger (1997); Riley (1998); Spicer (2002)
35 Egypt and South Africa had documented abuse among poorer populations and South Africa had passed an anti-cannabis law in 1911. Meanwhile, Canada had no documented use, but American horror stories of drug abuse had circulated Canadian media in the years prior to the Convention and the Canadian Parliament had passed the 1923 Opium and Drug Act that for the first time prohibited cannabis (Riley, 1998; Böllinger, 1997)
36 Böllinger (1997)
37 European Monitoring Centre for Drugs and Drug Addiction (2012)
38 Sensi Seeds (2 September 2015)
39 Böllinger (1997)
40 Mikuriya (2007)
41 European Monitoring Centre for Drugs and Drug Addiction (2012)
42 Böllinger (1997)
43 United Nations (21 October 1998)
44 Brodzinsky (2016); Doward (2016); Ingraham (24 March 2016)
45 Ingraham (24 March 2016); De Carvahlo (17 February 2016); Chalabi (19 April 2016); Brodzinsky (18 April 2016);
Doward (2 April 2016); Clegg & Sobotka (31 January 2016)
46 Annan (2016); Annan (2015); Silva (2015)
47 The Office of Medicinal Cannabis: Homepage
48 Silva (2015); Marshall (2016); de los Reyes (2013)
49 Sullum (2015)
43
50 Ingraham (24 March 2016); De Carvahlo (17 February 2016)
51 Böllinger (1997)
52 United Nations Office on Drugs and Crime (2013)
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