This European Country Could Lose $242M A Year If It Doesn't Regulate Its Marijuana Market, Study Finds

The Czech Republic could be missing out on hundreds of millions of euros annually as the governing coalition remains persistent in avoiding establishing a regulated marijuana market. That's according to the findings of a comprehensive study examining the possible costs and benefits of various cannabis reform models being proposed nationwide.

What Happened

The researchers from the Faculty of Business Economics at the University of Prague concluded that a “comprehensive model,” incorporating self-cultivation, cannabis clubs and a fully commercial market, could result in "total net social benefits of CZK 5.5 billion (218 million euros; $242 million) per year," reported Business of Cannabis.

The study was published on Thursday, Sept. 12, by the University of Prague. It analyzed each of the cannabis reform models proposed by former National Drug Coordinator Jindřich Vobořil.

Vobořil left his position this summer, but he continued taking part in the development of addiction policies in the country as an independent expert. He previously completed two separate versions of the measure to legalize cannabis.

Vobořil's legislation, which includes commercial sales, seeks to set up a cannabis market much like that in Canada and certain US states. The other measure mimics Germany's current cannabis framework, with legal home cultivation and cannabis social clubs.

Read Also: Full Cannabis Legalization Not Yet Off The Table In Czech Republic, Some Lawmakers Want Only Home Grow

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Which Legalization Model Is Most Economically Advantageous?

That said, the study suggested that legalizing only self-cultivation would yield a net social benefit of CZK 1.2 billion annually and CZK 16.5 billion over the first 11 years. Moreover, putting cannabis clubs into the equation would result in CZK 1.5 billion per year and CZK 20.8 billion over 11 years in social benefits.

However, the highest returns would come from the comprehensive model, featuring a regulated market alongside self-cultivation and clubs, which is projected to deliver CZK 5.5 billion per year and CZK 77.2 billion over 11 years in social benefits.

"The conclusions are very simple,” Patrik Sieber, one of the study's authors, said. “All evaluated options appear to be socially and financially more beneficial for public budgets than maintaining the status quo.”

These Cannabis Operators Could Benefit From Policy Change

In the meantime, cannabis operators have been strengthening their market presence in the European country.

Curaleaf International, part of Curaleaf Holdings Inc. CURLF, already present in the European market, opted to expand in the Czech Republic in March, via a new supply agreement with Astrasana Pharma s.r.o. Under that deal, Curaleaf International's EU-GMP flower was made available to patients via Pilulka Pharmacy, a healthcare provider in the region.

PharmaCielo Ltd. PCLOF's first shipment of THC-dominant dried cannabis flower to a customer in the Czech Republic made headlines in 2022.

In 2023, the medical cannabis division of Canadian giant Tilray Brands, Inc. TLRY expanded its European footprint across the Czech Republic through a new export and distribution partnership with Cansativa Group.

Additionally, Canopy Growth Corporation WEED CGC’s medical brands already service European medical markets in Germany, the Czech Republic and Poland as well as Asia-Pacific markets including Australia and New Zealand.

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