New Legalization Law In Germany Creates Broader Liberties For Pharmacists

The news was trumpeted around the world: Germany, the European Union’s largest economy, surprised the global cannabis industry with the announcement of the legalization of cannabis for restricted recreational use, to be effective April 1. Additional regulations for collective private cultivation in so-called cultivation associations are set to take effect on July 1, 2024.

The law passed by the German parliament and Chancellor Olaf Scholz's ruling three-party coalition legalizes cultivating up to three plants for private consumption and owning up to 25 grams of cannabis. Larger-scale, but still non-commercial, cannabis production will be allowed for members of so-called cannabis clubs with no more than 500 members, all of whom must be adults. Only club members can consume their product.

Pharmacists applauded the legalization, which was expected but not until the next decade or so. “Legalization came early, and it's a big surprise for everyone,” said Ivan Garev, co-founder of the Munich-based medical cannabis company, Drapalin Pharmaceuticals. He estimates that his company currently has 4 percent of the market share for medical cannabis in Germany. 

 “Six years ago, as we started the business, I was expecting the legalization to take 10 to 15 years. Germany is not really famous for being very open to new laws or to new drugs.” He said that, during the last months, it was 50-50 if legalization was really going to work out or not. “But it's revolutionary. Because Germany had such restrictive laws for cannabis. And now it changed completely. Everyone in the world is looking at Germany right now.”

The announcement comes after the country first legalized medical cannabis in 2017, then began haggling over exactly how cannabis would be grown and distributed in the country, the legal amounts to be grown, what the recreational use would look like, and where pharmacists fit into the plan of providing cannabis to patients as a non-narcotic for the first time. 

Demand for medical cannabis is growing exponentially in Germany. Latest pharmaceutical statistics show that, in 2021, around nine thousand kilograms of medical cannabis was sold to pharmacies in Germany, an increase from around 6,300 kilograms sold to pharmacies in the previous year. 

Legalization overcame delays from the European Union caused by drug trafficking rules and other German parliament diversions during the past seven years, picking up momentum in October, 2022, when German Health Minister Karl Lauterbach presented his plans on the legalization of cannabis to the cabinet which would have allowed sales across the country at licensed facilities. More adjustments and limitations to the terms of legalization were introduced in April, 2023, as reported by the Associated Press.

The plan to legalize was originally going to be modeled after Canada’s, Garev said, with an open market for cannabis to include dispensaries or coffee shops where a customer can go and buy a cannabis product. “It's not possible right now,” he said. “But the most important change for us as a pharmaceutical company that was made by the German government is that cannabis will not be a narcotic anymore. Doctors can prescribe cannabis on a normal prescription,” he said. “The main thing is that the relationship between doctors and the insurance companies will also be much easier, much more simple.” The law also provides that patients will no longer need to have a chronic disease to obtain a cannabis prescription.

The market will grow very fast now, he said, eventually reaching the predictions made in 2017 that there were at least 1 million medical cannabis patients in Germany. Current market estimates put that figure at just 200,000. “Right now, we are very, very careful with our predictions. But obviously, the market’s going to grow. The only question is how fast.”

It’s still early in the legalization process, which is essentially working through the first step of a two-step process and will still be undergoing the usual legislative scrutiny in the German parliament over the next few weeks. 

The second step is still getting clarified with the European Union about how growing and using cannabis should actually work, Garev said. It will be a separate legislative procedure, according to a draft of the law, where commercial production and distribution of cannabis for non-medical purposes will be tested in regional and time-limited pilot projects. “But the idea for step two is actually to create an organization for production, such as a production application for cannabis and dispensaries. This is actually what we are really waiting for.”

He said that they hope to understand the details very soon. “Because right now, we just understand the big picture, but not the details of the big picture.” 

The legalization announcement comes at a time when the German government is struggling to recover its economic mojo which has been dragged down by the Russian war on Ukraine and high interest rates, according to the country’s recently released annual economic report. “In all, it is clear that Germany remains under considerable pressure as a place to do business,” the report stated.

The new law may be just the shot in the arm the country needs. According to Statista, in 2022, medical cannabis generated a revenue of 253.5 million euros in Germany. This was an increase of almost a hundred euros compared to 2021. Although the medical cannabis market has shown consistent growth in Germany, the therapeutic cannabis market has a much larger revenue that is expected to surpass a billion euros in 2025. Those figures were published before factoring in the revenue-generating effects of this new legalization effort.