Mexico medical cannabis regulations- a brief overview
Mexico medical cannabis regulations – a brief overview
Mexico is quickly emerging as a key player in the global cannabis market following the recent passing of Adult Use laws by the country’s Senate and the signing of long-awaited medical cannabis regulations by President Andrés Manuel López Obrador.
With a population of roughly 130 million, Mexico is positioned to become the largest country in the world to legalize both medical and adult-use marijuana, behind Canada in 2018 and Uruguay in 2013. Within Latin America, the country enjoys a relatively high GDP PPP per capita of U$21,800 (28-40% higher than Colombia, Peru and Brazil which clock in at $15,500, US$15,600 and $17,000, respectively). Mexico also boasts an impressive and efficient healthcare system, delivering universal healthcare through both public and private healthcare schemes.
Prohibition Partners (THE LATIN AMERICA AND CARIBBEAN CANNABIS REPORT: SECOND EDITION) pegs Mexico’s medical cannabis and CBD markets at nearly $60M by 2024, alongside a recreational market in excess of $225M. Looking out even further, New Frontier Data estimates Mexico’s total addressable market at ~$2 billion!
Playing to its strengths and understanding the pitfalls of commodity-based marketing strategies, Khiron plans to pursue an entry into Mexico’s medical cannabis market, where it has already trained several hundred doctors in partnership with the country’s leading educational institute, Tec of Monterrey.
The new medical regulations have a lot to unpack, so we wanted to share some highlights based on our interpretation of the regulations.
- In late November 2020, the Mexican Senate approved a bill to legalize adult use marijuana and on January 12, 2021, the Government of Mexico published long-awaited medical regulations. The signing of the new medical regulations came roughly 3 years after initial medical cannabis laws were passed. Notably, the regulations will not require a new regulatory body, which, in our experience, expedites timelines.
- Unlike Colombia, there is no specific licensing system. Rather, three stakeholder groups (production labs, pharmacies, and clinics) will control, manage, and monitor medical cannabis in Mexico. In this regard, Khiron has experience establishing production and distribution partnerships in multiple jurisdictions and has already announced plans to expand its Zerenia clinic strategy in Mexico. As such, we’re pleased to see that medical clinics will be permitted to distribute medical cannabis.
- Final products include magistral preparations among other formats; if you’ve been following the Khiron story, you’ll likely be familiar with magistral preparations (aka pharmacy compounds), which Khiron has been producing since March 2020. This experience means we have standard operating procedures (SOPs) in place and firsthand knowledge on how to efficiently produce / register these types of products.
- There is no distinction between CBD and THC products, meaning both require import quotas. Recall that Khiron received 17% of Colombia’s 2020 THC production quota. Moreover, we have experience handling quotas as the first company in Colombia to successfully export high and low-THC cannabis.
- The regulations have a major focus on quality control. In that regard, Khiron has accumulated stability data, standardized formulations, and SOPs in Colombia. INVIMA (Colombia’s health agency) is also well regarded in Mexico.
- Physicians must be certified to prescribe medical cannabis. Additionally, advertising is limited to health professionals. Here we’d note that Khiron’s Chief Medical Officer is based in Mexico and that the company has a partnership with the leading university in Mexico, Tec of Monterrey, where we’ve already trained 500 doctors!
- Both Mexican citizens and foreigners will be allowed access to medical cannabis, opening the door for medical cannabis tourism.
"We are pleased to see the Mexican legislative and executive branches working together to bring medical cannabis closer to a reality. At Khiron, our goal is to improve the quality of life of 1 million patients by 2024 and Mexico will play an important role in our strategy. Because of this, we partnered with Tecnologico de Monterrey to bring our medical cannabis education platform to doctors working in clinics and health centres across Mexico and LatAm. The clinic model is one we understand well and in which we have proven success. As medical cannabis regulations continue to evolve, we plan to take advantage of our vertical integration model by deploying our Zerenia medical cannabis clinic and telehealth strategy in Mexico,"
Alvaro Torres, Khiron CEO and Director.