Widespread legalisation of adult-use cannabis now seems inevitable for most of North America, Europe and Latin America; but the effect on the medical cannabis markets has not been widely discussed. It should be expected that the legalisation of adult-use cannabis sales is to have a considerable effect on the medical cannabis market given that they share a large intersection of consumers/patients.
Underlining this, Prohibition Partners’ 2020 survey of over 15,000 respondents across North America and Europe indicates that 58% of people using cannabis do so for both medical and recreational uses. At the time of writing, only Canada, Uruguay and 21 states in the US, including Washington D.C. and Guam, have legalised adult-use cannabis but this is expected to increase at a fast pace over the next five to ten years, as the economic, health and justice benefits become clearer to regulators round the world. Below we consider some of the possible effects of adult-use legalisation on medical cannabis.
Effects on patient numbers
Legalisation of adult-use sales can have a considerable impact on the number of new registrants. This trend has been seen in several states in the US, as well as in Canada. It can be expected that this occurs due to existing patients choosing not to renew their medical authorisation, as well as new consumers opting to obtain their product straight from the adult-use market without ever getting an authorisation.
The introduction of adult-use cannabis laws had a large impact on the number of people registering as medical cannabis patients in Colorado, Michigan, Nevada and Oregon. The effect is clearly variable, e.g.in Colorado, patient registrations have stagnated compared to Oregon, where patient numbers have dropped to just 22,500 patients, less than a third of the 78,000 patients in the state at the peak levels. It should be noted that not all states that introduced adult-use cannabis sales saw such a drastic impact on the number of patient registrations.
Massachusetts patient registrations have climbed from 40,000 at legalisation of adult-use cannabis in 2016 to over 100,000 in 2021. The largest deciding factor in whether patient registrations stagnate after recreational legalisation is the the ease with which a consumer can obtain medical or adult-use cannabis. Oregon has seen the most drastic decline in patient registrations of any state, owing largely to the fact that it has the highest number of adult-use dispensaries per population, at 179 per million inhabitants compared to 9.3 per million for Massachusetts. Other aspects such as cannabis prices, tax rates and available ranges of products are likely to factor into the equation for the decline or maintenance of medical registrants.
Effect on patient population characteristics
The migration of patients from the medical cannabis sector to the adult-use market will probably have an effect on the makeup of the patient population who continue to obtain their product via legal medical pathways. For example, in Oregon there has been a consistent decline in the share of total registered patients up to the age of 65. Registered patients below the age of 65 have been several times faster to leave the medical sector than older patients. The trend is also visible in other regions in the US, where the 70+ age category in Colorado is the only bracket which continues to grow gradually while patient numbers in all other age brackets shrink in that state.
Amongst the few states without adult-use sales and who publish statistics on patients and their ages (Arkansas and Arizona), no such trend in the age profile of the medical cannabis patient population is visible. This could potentially be explained by younger generations being quicker to obtain cannabis without medical supervision owing to more liberal behaviours among consumers of this cohort. This is an example of how the migration from medical to recreational cannabis will be somewhat deterministic, and will shape the future consumer/patient population for each market.
Effect on patient experience
There is evidence from the several surveys carried out across Canada that medical cannabis patients experience a range of impacts due to the legalisation of adult-use cannabis. For example, the overall use of cannabis increased in medical cannabis patients in Canada after legalisation, potentially due to the normalisation of the plant and the fact that it was a common topic of discussion in the media leading up to, and after, legalisation. The number of patients reporting recreation to be a driving factor for consumption increased in the three months after legalisation. Importantly, as many as one in four patients using medical cannabis reported an increased difficulty in obtaining their preferred medical cannabis products after the introduction of adult-use sales. While adult-use cannabis stores have the potential to bring in a wider range of products than pharmacies or medical cannabis dispensaries, some patients have found that their preferred product either increases in price or decreases in availability following the legalisation of medical cannabis. Researchers on the topic have stressed that these impacts on medical cannabis patients should be considered within the development process of regulated adult-use schemes.