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How is the Cannabis Industry Impacting Big Pharma?

Posted by Lewis Olden on
How is the Cannabis Industry Impacting Big Pharma?

The global pharmaceutical industry is estimated to be worth $1.57 Trillion by 2023, which makes the Cannabis industry seem tiny in comparison. It seems inevitable that Big Pharma is going to play an integral role in how the Cannabis industry develops. As Medical Cannabis treatments begin to have data supporting their efficacy and new compounds such as CBDA are discovered, the use of Cannabis as a medicine will become impossible to ignore. 

There are numerous ways in which Cannabis could disrupt the pharma industry which in turn may encourage investment from the pharma industry. Alternatively, the growth of the Cannabis industry may cause the pharma industry to react by forcibly strengthening the barriers to entry for Cannabis companies, drowning them in regulation and legal complications which are compulsory to be compliant. 

The Power of Big Pharma

In the United States, the Pharmaceutical & Health industry are by the biggest spenders when it comes to lobbying the US Government. In 2019 the pharma industry spent $228,149,734 lobbying the US Government, the next highest spender was the Electronics Manufacturing industry ($119m) closely followed by the Insurance industry ($117m). This is an illustration of the power that the pharma industry holds, its influence over governments throughout the world is unquestionable. There is huge debate about the intentions and motivations of the pharma industry. With profit often emphasised with disregard to patients and consumers.

An example of the power the pharma industry holds are the laws surrounding vaccine law. The Vaccine Injury Compensation Program is a US Government program that has paid out in excess of $4 billion to people who have been adversely affected by taking a vaccine. As stated on its public record, between 2013 & 2017 the program had paid out an average of $229m per year to patients and their relatives. The mean payment was around $430,000.

Vaccines are formulated and produced by privately held pharmaceutical companies. However, there is an arrangement with the US Government ensuring that when a person reports harm that could feasibly be related to a vaccine, a government program pays the compensation, not the pharmaceutical company that produced the vaccine.

The law summarized appears to lead to the conclusion that a vaccine manufacturer need not fear liability from injuries resulting from the administration of the vaccine if;

  1. The vaccine is correctly manufactured in accordance with regulatory standards and prudent manufacturing practices
  2. The manufacturer has taken reasonable steps to ensure that the recipient of the vaccine will be warned of possible side effects

If a manufacturer adequately warns physicians or, in the case of mass-administered vaccines, the recipient about a drug's foreseeable adverse effects, they will escape liability unless the plaintiff can show that the injury was caused by some impurity or resulted from an unreasonably dangerous design. 

This legislation means that pharma companies that produce vaccines have no financial repercussions if they manufacture a vaccine that harms those who it is administered to. The compensation is instead paid out of a taxpayer’s pool of money, meaning the pharmaceutical company can evade the financial responsibility of compensating those whose lives have been irreparably damaged.

This level of influence over the US Government delineates the power Big Pharma possesses. In the instance of the Federal Legalisation of Cannabis, it is not unreasonable to suggest that this influence is utilised to ensure that Cannabis remains Federally illegal. Full Cannabis legalisation could lead to people treating certain conditions like chronic pain with recreationally legal products and research into cannabidiolic acids would increase which could be a threat to the opioid industry. A recent example about the innovation with regard to CBDA is the patent acquired by Dr. Mechoulam and EPM, an American Biotech company. 

Medications are being prescribed more frequently than ever before in history and the success of expensive medications are as dependent on the patient as they are on the drug’s efficacy. Evaluating the cost effectiveness of a drug is now an integral part of country’s national health regulators such as NICE and G-BA. These healthcare austerity decisions are become ever more stringent on the cost to benefit analysis of new medications when compared to existing treatments.

Health & Wellness Threat to Big Pharma Revenues

The population are becoming increasingly more educated about Health & Wellness and the measures they can take to optimise their body. The difference a healthy diet can do to a person’s state of mind is incredible. The diet that is associated with the American Dream and therefore most of Western culture, is extremely unhealthy and consuming processed foods, fast food and vast amounts of sugar will eventually lead to a medical problem. It is almost by design.

As people become cognisant of this and seek alternative natural remedies to improve their health, their dependence on Big Pharma declines. Eating organic produce in cohesion with taking natural supplements can help to maintain balance within the body. Enhancing what you consume can mean a decrease in the number of visits you have to pay a doctor which ultimately leads to fewer prescriptions. This is obviously not within the interests of the pharmaceutical industry. 

Cannabis has the capacity to help people manage ailments they suffer from as opposed to seeking medical help. For instance, once fully recreationally legal, Cannabis medicines that are prescribed by Medical Cannabis Clinics will not differ too greatly from what is available for purchase from dispensaries and eventually even online. This means that once someone finds a cannabinoid ratio that works for them and a brand they trust, they will be able to use Cannabis to manage their own symptoms.

Chronic pain is an instance of an ailment which Cannabis may be able to help sufferers manage their pain. Rather than being prescribed opioids or other medications with unpleasant side effects and the hassle of going to see your GP or going to A&E. A Cannabis product could be purchased after some in depth research to help to alleviate the symptoms.

The world is becoming a lonelier place and people are increasingly isolated. Addictions to phones and social media mean can heighten anxiety and be a factor in people falling into depression. While more research is greatly needed, Cannabis products may be able to help people deal with their anxiety and depression.

Educating the population on not just the use of Cannabis to deal with particular ailments, but an entire natural and holistic approach can help people improve their health and ensure their wellbeing is within their own power. This will reduce the number of prescriptions written by doctors as people will be healthier and therefore have less of a need to visit their GP.   


The global pandemic will only reinforce the power of Big Pharma and the revenue that will be generated from the inevitable COVID 19 vaccine will cement the industry’s position. Healthcare and Technology seem to be two industries that will be at the forefront of the 21st century and there could be a role for the Cannabis sector to play within both.

As Telehealth transforms the manner in which patients seek medical advice from a doctor, the nature of how prescriptions are distributed will inevitably change. New technologies such as Echo Pharmacy are providing services in combination with the NHS that are more befitting of the 21st century. Echo delivers your NHS prescription to your door, for those who have repeat prescriptions this service is extremely helpful and re-ordering your medicine via an app with free delivery is far more convenient than having to go to a pharmacy or your GP clinic. The Echo service in combination with Telehealth consultations seem to be the future of how medicine will be practiced especially in the wake of COVID 19.

Unfortunately, due to the current legislation concerning Cannabis, this model of patients obtaining their medicine can become complicated but there have been exceptions made throughout the lockdown to ensure those who need their Cannabis prescriptions are able to receive them. The laws surrounding access to Medical Cannabis were eased throughout lockdown to ensure that patients could receive their necessary medication.

Synthetic Cannabinoids

Revolutionary compounds such as CBDA could transform the pharmaceutical and the Cannabis industry. Raphael Mechoulam has announced the development of a methodology to modify and stabilise cannabidiolic acids (“CBDA”). Cannabidiolic acids are created in the cannabis plant’s growth and have the capacity to be used on a vast scale.

The resulting semi-synthetic, stable, acid-based compound could be used to supress nausea from chemotherapy and as a treatment for ailments such as inflammatory bowel disease and psoriasis. Initial research indicates that these compounds are more potent than CBD or THC and have yet to show negative side effects. There is a quiet optimism that the compounds have the capability to replace some steroids and opioids.

The capability for the inventors of these new compounds to patent their discoveries add substantial value to a successful research process. Once the efficacy of these new compounds is proven through a rigorous research process, pharmaceutical companies and large Cannabis players alike will begin to allocate capital to research and development into the synthetic cannabinoid arena.

Thus far, Big Pharma has had a hostile attitude towards the growth of the Medical Cannabis industry and has been actively campaigning against the legalisation of Cannabis in the United States.

Covertly, several large pharmaceutical companies have been developing various synthetic cannabinoids. This could be viewed as a tactic to try and attempt to ensure that the release of cannabinoids to the market are controlled by the pharma companies that control the rest of the drugs that are available. The rumours that the FSA and EFSA are only going to approve Novel Food applications using synthetic CBD isolate could be a further extension of this.

Legalisation of Cannabis Results in a Decrease in Prescriptions

A study carried out in 2016  investigated the relationship between Medical Cannabis Laws and prescription medication use in the United States. The researchers found that once a state passed laws that allowed the sale of Cannabis in a recreational or medical capacity, the prescription habits of the state’s doctors changed.

Prior to legalisation, doctors were prescribing a variety of different drugs as well as myriad of opioids. Once Cannabis was legalised, the rate at which other drugs were prescribed dramatically decreased.

With Doctors able and eager to prescribe Cannabis based medicines as a natural source of pain relief or a treatment for other symptoms instead of medications with potential harmful side effects.

A 2014 study discovered that the rate of opioid overdoses within states that has legalised Cannabis had fallen by approximately 24%.

It can be dangerous to assume that causality directly correlates with causation, the findings of these studies suggest that people were more content with being prescribed Medical Cannabis instead of opioids but in states where Cannabis is recreationally legal, it is the preferred choice over potentially lethal drugs such as Heroin and Fentanyl. 

This is a clear illustration of why the pharmaceutical industry is wary of full Cannabis legalisation and needs to take measures to ensure that it protects its interests.

What Action will Big Pharma take?

While the pharmaceutical industry has been clear in their intent to fight against both Medical and Recreational legalisation of Cannabis, making large donations to anti-legalisation campaigns across not only the US but the world. They have also been quietly developing synthetic cannabinoids like Marinol and Cesamet with an agenda to compete with natural Cannabis products. These synthetic products were formulated to replicate the therapeutic benefits of natural Cannabis while not having the associated social stigma of weed.

The Cannabis plant is significantly different to the synthetic compounds being created as the plant contains far more varied and complex cannabinoid compounds than just THC. THC may well be what Cannabis is best known for, but CBD is also a major contributing factor in its therapeutic effects. There is also more to be unveiled about the entourage effect and other cannabinoids such as CBD, CBG and THCA. The combinations of all of these naturally occurring cannabinoids in cohort with a range of terpenes result in a complete experience with a greater therapeutic effect.

GW Pharmaceuticals is one example of an entity taking advantage of the Cannabis market. GW Pharmaceuticals has invested a very significant of money into the development and production of Cannabis based medicines. GW Pharmaceuticals has successfully released Sativex, a Cannabis based medicine that is used for treating epilepsy.


While there needs to be an ideological shift across the globe for Cannabis to be universally accepted, the transformation of the perception of Cannabis within society’s consciousness is gradually beginning to illustrate the positive effects Cannabis can have on individual’s wellbeing and society as a whole.

The pharmaceutical industry is compounding its power and influence over humanity’s daily lives and Cannabis is a rare example of how you can begin to take back some control over your wellbeing and lifestyle. It will take several brave politicians and people in positions of significant influence to ensure that the appropriate legislation is implemented that allows Doctors, patients and recreational users to freely access the power of the Cannabis plant.

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