Growing Colombia cannabis exports reach $10.8 million as government extends sell-by dates

[Joolz]

Colombia’s medical cannabis exports continued to grow last year, although sales still haven’t reached the level that the country’s operators envisioned.

 

In 2023, the value of medical cannabis exports from Colombia was $10.8 million, according to figures provided to MJBizDaily by ProColombia, a government agency in charge of promoting nontraditional Colombian trade.

The figure represents an 11.3% increase over 2022, when Colombia’s medical cannabis exports amounted to $9.7 million, a 96% jump from 2021.

 

Industry sources see the latest export figures as a sign the Colombian cannabis market continues to mature.

 

“I think the practical, environmental and socioeconomic benefits of cultivating and extracting in Colombia are finally starting to show some signals of their potential,” said Aras Azadian, CEO of Avicanna, a Canadian biopharmaceutical company with operations in the South American country.

 

“It’s a very small market opportunity for now, but we do expect it to grow as medical and pharmaceutical projects mature, such as our (drug) Trunerox obtaining marketing authorization in Colombia or our partners in Brazil Ease Labs obtaining authorization in Brazil, both of which use our Colombia-made active pharmaceutical ingredients.”

 

Trunerox is Avicanna’s CBD–based pharmaceutical drug for people with epileptic conditions Lennox-Gastaut syndrome and Dravet syndrome.

 

Azadian said the medical cannabis market takes longer to develop, and he believes only a few companies will be left standing because the market opportunity does not justify the billions of dollars invested in Colombia nor the current number of operators.

 

“Overall, it’s just a longer-term business model – medical and pharma – as it takes longer to get products approved,” he said. “Now that some are approved, we’re seeing potential scale.”

ProColombia said 2023 cannabis exports included finished products such as cosmetics, dietary supplements and phytotherapeutic products as well as plant-based medicines.

 

Other cannabis exports included:

• CBD isolates.
• Crude extract.
• Distillates.
• Seeds.

 

The top destinations for Colombia’s exports have been changing as rules evolve in other countries.

 

Brazil was the top destination for Colombia’s medical cannabis products in 2023, overtaking Argentina, according to the ProColombia data shared with MJBizDaily.

Brazil accounted for 32%, or $3.4 million, of Colombia’s total cannabis exports last year.

 

Australia accounted for one-quarter of the exports, or $2.68 million, a 99% increase over 2022.

Germany was the third-largest importer of Colombian cannabis, with $1.53 million, or 14% of the total.

 

Azadian said pharmaceutical cannabinoid drugs such as Trunerox are permitted to make medical claims, which could help boost exports from Colombia in the coming years.

“Now you can take that product and register it in something like 22 other countries in the Pan-American region, because they have a reciprocal understanding with INVIMA (Colombia’s National Food and Drug Surveillance Institute).

 

“I believe our drug Trunerox, if executed properly, has potential to be a major export out of Colombia as a finished product rather than raw materials that others aim for.”

Cannabis shelf life

Late last month, the Colombian ministries of Health, Justice and Agriculture extended the time frame that THC products can be sold or exported after production to 48 months, doubling the previous limit of two years.

If the product isn’t sold or exported after 48 months, it must be destroyed.

 

Industry officials said the impact of the rule change will vary from company to company, with some seeing it as critical and others saying it won’t affect their operations at all.

 

Julian Wilches, an executive with Colombian cannabis producer Clever Leaves, said the original purpose of the rule was to prevent companies from stockpiling massive amounts of unsellable cannabis – as has happened in Canada.

He said the cannabis industry was lobbying the government to eliminate the rule altogether, but the two-year extension effectively solves the problem.

 

“In practice, the extension solves the problem, because nobody will have the same inventory for four years,” Wilches told MJBizDaily in a phone interview.

 

“For some small and medium-sized growers, that inventory was the only capital they had, so they have to do something with it.”

PharmaCielo, another cannabis producer headquartered in Canada with operations in Colombia, said the rule change is “of immediate benefit” to the company and the industry overall.

 

“As the country’s largest cannabis producer, PharmaCielo has over 2 tonnes (2.2 tons) of THC extract in inventory to support expected growth in international sales. … (It) would have been subject to destruction under the legacy framework,” the company said in a news release.

 

“This resolution will enable the retention of high-quality THC extracts in inventory – both now and longer term – to ensure we can quickly fulfill demand as our international customer base continues to grow,” PharmaCielo CEO Marc Lustig said.

Colombian cannabis sales

Government-funded health insurance in Colombia was expanded to include medical cannabis in late 2022, but the domestic market has struggled to take root.

 

So far, only two medical cannabis drugs have obtained an INVIMA marketing authorization in Colombia.

 

The market’s remaining medical cannabis products are magisterial preparations.

 

Ernesto Castilla Bautista, senior legal director for Avicanna, said the Colombian magisterial preparation model is structured so Good Production Practice-certified facilities cannot hold inventory of magisterial preparations; they can manufacture products only after they have received a prescription.

 

“This greatly hinders the (a large) facility’s ability to take advantage of economies of scale,” Bautista said.

 

He added that some insurance companies have denied medical cannabis coverage, arguing that magisterial preparations don’t match INVIMA’s authorization.

 

Bautista said Colombian courts have rejected this argument and ordered insurance to cover the magisterial preparations, “but the process ends up taking a lot of time and being very cumbersome for the patients.”

 

“Hopefully,” he continued, “with products like Trunerox having INVIMA approval that explicitly includes the authorized indications and being able to manufacture batches before a prescription is issued, medical cannabis prescriptions in Colombia will start to increase since patients will have access to cheaper alternatives that also have more straightforward coverage.”

 

 

https://mjbizdaily.com/growing-colombia-cannabis-exports-reach-11-million/