What is the current state of cannabis in Australia?

Isaac Balbin
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Cannabis, Regulations
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The Australian cannabis industry is still in its infancy. 

Though cannabis was legalized for medicinal use in 2016, regulations are so strict that few people know about it and those that do struggle to qualify. 

However, with political parties and members of the public advocating for its legalization, the Australian Capital Territory voting to legalize cannabis for personal use and innovative cannabis-related businesses creating high quality products and services, there is massive potential for the future of the Australian Cannabis Industry. 

Current cannabis laws in Australia

Recreational cannabis laws in Australia

Currently, the recreational use of cannabis remains illegal across all federal, state and territory laws in Australia except for Australian Capital Territory (which we will explore below). 

While more and more countries are legalizing the personal use of cannabis, Australia is falling behind. So just how close (or far) is the whole country from legalizing it? 

The only state who has made advances to legalize recreational cannabis is the ACT (Australian Capital Territory). As of January 31, people within the ACT will be able to legally smoke cannabis (as long as it is no more than 50g worth) and grow 2 cannabis plants in their homes. 

Unfortunately it is very possible that the bill could be overturned at a federal level. The Deputy Prime Minister, Michael McCormack, has already called it ‘a dopey decision made by dopey people’ and has returned to the ‘Reefer Madness’ rhetoric on sending the wrong message to kids. 

However, even if the law never becomes a reality, the fact that it happened is still a step in the right direction as it is generating word around the topic. 

And in Australia this pattern of legislation being stuck down at a Federal level has a history. The ACT legalized same-sex marriage in 2013 and this was overturned almost immediately. But in 2017 Australia joined the rest of the world and legalized same-sex marriage across the country.

Once more and more states voice their opinions on the topic, the government will have to listen to the demands of the country. 

The ACT isn’t alone in their goals to see recreational cannabis legalized in Australia, the Australian Greens Party is pushing equally as hard. The party has been advocating for full decriminalization and legalization of cannabis, the party has even stated that a legal and regulated cannabis industry would “smash the business model of criminal gangs overnight – putting $2 billion into the economy every year to go towards our schools, hospitals and essential services.”   

Although, after undertaking an in depth analysis, New Frontier Data estimated that if cannabis was legalized within Australia, the market could actually be worth a huge $5 billion annually

The party is also advocating for the establishment of a fully controlled market for the sale and production of cannabis and cannabis-related goods. Although there is a strong push for the legalization of cannabis in Australia, there are still many advances that need to be made before this is actually a sound reality. Even once recreational use of cannabis is legalized strict regulations will be placed on the industry which will likely put restrictions on the public’s access to the products. This scenario is currently occurring in Australia within the medicinal cannabis industry which we will explore below. 

Medicinal cannabis laws in Australia

In 2016, the Australian Parliament passed an amendment to the Narcotics Drugs Act to let cannabis be legally grown for medicinal and scientific purposes, finally starting Australia’s pathway to legalized cannabis.

In 2017, The Therapeutic Goods Administration (TGA), a regulatory body for therapeutic goods in Australia, rescheduled certain medicinal cannabis products to a schedule 8 of the Poisons Standard. 

Since then, all 6 states within Australia have in some form legalized the prescription of medicinal cannabis. Whilst this is a giant leap forward for the industry, there are still several obstacles holding the industry back from thriving. 

Due to strict regulations placed on medicinal cannabis, gaining access to it is an incredibly  complicated process. So although it is legal in Australia, it is still out of reach for many Australian citizens seeking to treat their illness with the medicine and many Australians don’t even know it is available as a treatment option.

Because most medicinal cannabis products are regarded as ‘unregistered products’ they don’t appear in the Australian Register of Therapeutic Goods (ARGT). People aren’t able to simply go to their GP, obtain a prescription for medicinal cannabis and then get it made up at the pharmacy. They have to enter into a complex process, one that doesn’t have a guaranteed positive outcome.

An individual must visit a doctor who is either an ‘Authorised Prescriber’ or one who is willing to make an application to be approved from both the Commonwealth TGA and The State Health Department to prescribe an unregistered cannabis product to a patient. The application alone requires incredibly detailed information on the proposed drugs. It also requires an explanation on why the doctor believes the medicine will be the best treatment for their patients particular illness. 

Once the doctor determines if the patient is eligible to proceed further, he will supply a prescription which can then be made up at a pharmacy. 

Although this process is available to doctors, there are very few who proceed because they don’t feel confident with applications under the Special Access or Authorised Prescriber schemes. The reasons for their reluctance to participate vary, some don’t feel adequately informed about the safe use of medicinal cannabis. Others may not have access to the detailed information required on applications for the TGA or State/Territory applications or they feel incapable to monitor the patients results after treatment commences. 

Regardless of doctors hesitations, there is a very healthy demand for medicinal cannabis coming from patients. A study of GPs conducted last year, found that more than two out of five GPs had received a request for a prescription for medicinal cannabis from patients within the three months prior to the study. Although there is a strong demand, there are very few patients who are actually gaining access to it on account of the low numbers of doctors willing to assist in the process. 

In the chance that a patient is lucky enough to gain access to medicinal cannabis, it comes at a very hefty cost as no medicinal cannabis is currently available on the Pharmaceutical Benefits Scheme. For example, Sativex approved to treat multiple sclerosis patients, the cost for a six to eight week supply was about $745.  

Medicinal Cannabis Research is on the rise in Australia 

On October 6, Health Minister Greg Hunt and Olivia Newton John announced that the federal government is pledging $3 million to go towards research for medicinal cannabis. The money will go to examining how cannabis can be used to treat cancer patients with pain, symptoms and other side effects. 

This is a really big step forward, not only for the state of cannabis in Australia, however also for cannabis research in general which is considerably lacking. We went into more on the lack of research in the cannabis industry here

The Institute for Health Research at the University of Notre Dame in Perth will lead a study tracking changes in actual dementia patients to see if cannabis can help. The cannabis used will be lab-grown from Slovenia, researchers are hoping the CBD-heavy strain will reduce the most damaging effects of dementia. 

The economic future of Australia’s Cannabis Trade 

Although the current state of cannabis in Australia is a little rocky, there is huge potential for its future in regards to international trade. 

Australia’s high agricultural industry standards aren’t just beneficial in the traditional sense, these standards could soon see a boom in Australia’s involvement in the global export of cannabis.

Although the Australian cannabis industry is still relatively young in comparison to other countries, there is huge potential for the country to become the “envy of the global market” and become the gateway to the Asian market. 

Kevin Smith, vice president for strategy and business development at Canadian company Emerald Plants Health Source stated “Australia’s reputation for best agricultural practices, crop safety management systems and robust quality control will make Australian-grown cannabis the envy of the global market and provide patients with confidence in this new form of medical treatment” 

This would be huge not only for Australia’s cannabis market, however also the cannabis industry on an international scale as it will introduce a new level of expected quality when it comes to the growing process of cannabis. 

Not only is Australia’s cannabis market expected to grow, it could also possibly be the gateway to the Asian market. A study conducted by London-based cannabis industry lobbyist Prohibition Partners estimates that the Asian market could potentially be worth US$5.8 billion by 2024. This would be huge news for Australia and its own cannabis market. 

Although this is great news for Australia, there are many problems the country has to address within its own market if they want to achieve these global goals. Issues such as heavy finance requirements, a repressive and complex licensing system and the reluctance to actually prescribe medicinal cannabis (despite being legal). 

Australian cannabis businesses to keep an eye on

Elixinol Global (ELX) 

Elixinol Global was formed in January, 2018 and is the baby of Colorado based Elixinol LLC joint forces with Hemp Foods Australia. The structure of the company sees Hemp Foods Australia manufacturing and distributing hemp food products and skincare, while Elixinol LLC is the bulk and retail provider of hemp based CBD dietary supplements and topical creams. The company is currently holding first place on the 2019 Top 20 Cannabis Companies list and is expected to continue rapidly growing! 

Cann Group (CAN) 

Established in 2014, the Cann Group is the first company to be issued with a Cannabis Research Licence by the Australian Government’s Office of Drug Control. This authorises the company to cultivate cannabis for research purposes. They have also been issued with Australia’s first Medicinal Cannabis Cultivation Licence which authorises the company to grow cannabis for medicinal purposes. They currently own two Melbourne facilities and a Mildura site expected to be operational by the second half of 2020. Cann’s vision is to be a leading developer and supplier of cannabis and medicinal cannabis products within Australia. 


Not only is Althea an Australian licensed producer, supplier and exporter of pharmaceutical grade medical cannabis (and even listed publicly on the Australian Securities Exchange). They also offer a range of education, access, and management services to support eligible patients and medical practitioners with navigating the complex medicinal cannabis system. They are currently operating in Australia and the United Kingdom with plans to move into the emerging Asia and European markets. 

Botanix Pharmaceuticals 

Botanix Pharmaceuticals mission is to develop the next generation therapeutics for the treatment of serious skin conditions. The company is dedicated to improving the lives of individuals suffering with acne, psoriasis and atopic dermatitis. To achieve this goal, the company will carry out studies in the field with the end goal of achieving US Food and Drug Administration (FDA) approval. 

The Bottom Line? 

The Australian cannabis industry is a young market, it is only natural that there will be challenges faced before it can fully thrive within the country. However, once these obstacles are crossed and the industry has the chance to flourish, there is massive potential for Australian cannabis to have an international impact. 

Whilst there is a long road to go down before cannabis is completely legal in Australia, the future of the cannabis industry in Australia comes with a world of possibility and excitement.

Author: Isaac Balbin
Isaac Balbin is a PhD graduate professional electrical engineer, and a successful startup entrepreneur. During his prolific career, Isaac has developed numerous unique RFID tag technologies, filed multiple successful technology patents - and has sold a startup he founded to an ASX listed company. Isaac’s journey has been defined by his focus and in-depth understanding of technology. This has lead him to excel in both the role of the technological visionary, and the commercial entrepreneur - driven to see his vision made real.

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