You can read Part 1 of our deep dive into Canadian cannabis in Europe here.
Last year represented one of the most notable shifts in the geopolitical landscape in modern history, with nearly half the world’s population holding national elections and seeing the largest number of votes cast in a single year in history.
This dramatic change in leadership has unavoidably seen a shift in attitudes towards cannabis, seeing the rhetoric in a number of key markets slip back towards prohibitionist tendencies.
Following the collapse of Germany’s government late last year, the federal election is now set to take place next week, with the poll-leading CDU promising to roll back cannabis policies.
Similarly, Canada’s general election is set for October, and its Liberal leader of 10-years, Justin Trudeau, who oversaw the legalisation of cannabis in the country, has announced his departure as the leader of his party.
With Aurora Cannabis and High Tide consolidating their presence across Europe, with a focus on Germany, how will this lucrative supply chain be impacted by these shifting dynamics?
Shifting dynamics
Poland, already a significant market for Aurora, is touted as one of Europe’s most exciting cannabis markets.
As discussed in Prohibition Partners’ recent Global Cannabis Report: 5th Edition, Poland’s medical cannabis industry has flourished in recent years, seeing prescription numbers surge from 11,400 in 2020 to 313,000 in 2023.
Just like Germany, telemedicine has been a major driver of growth in Poland, but increasing concerns around the ease of access and use for non-medical purposes have made this a contentious and highly politicised issue.
In November, Poland’s Ministry of Health stepped in, preventing private clinics from offering remote consultations for cannabis prescriptions, and ensuring national health physicians can only provide remote consultations and prescriptions for patients who have previously had an in-person consultation.
As a result, prescription numbers plummeted from 68,000 in October to 42,000 in November, and further to 28,000 in December 2024.
Despite similar rhetoric becoming widespread in Germany, and the CDU promising to repeal their predecessor’s legislation, both companies are confident medical cannabis will remain untouched.
Aurora’s CEO, Miguel Martin, told Business of Cannabis: “So far, we haven’t heard anything from the potential new government or coalition that would suggest any negative impact on medical cannabis. Recreational cannabis, on the other hand, may face some setbacks.
Raj Grover, the CEO of High Tide, added that while the CDU has pledged to roll back reforms related to recreational cannabis, ‘they also intend to review how medical cannabis is sold in Germany and the broader regulations around it’.
“That said, their primary focus appears to be on recreational cannabis, and even that isn’t certain, as they won’t be able to form a majority government. This means recreational cannabis could still have a future.”
With this in mind, he emphasised that this was exactly why his company is pursuing a ‘two-pronged approach’, focusing on both medical and recreational cannabis in Europe.
“Regardless of the election outcome, I don’t think we’ll be significantly affected. Globally, the cannabis industry is progressing. It’s only a matter of time before more European cities and countries embrace both medical and recreational cannabis.”
Oversupply
Aside from the high levels of taxation in the Canadian market, a key driver of the growing exportation of Canadian cannabis is domestic saturation, seeing millions of grams destroyed each year.
Concerns that this issue could simply be exported to Germany and other European markets have been present for some time, but both companies believe their is plenty of headroom before this becomes an issue for their businesses.
Grover continued: “Germany is still in the early stages of growth—its medical cannabis laws came into effect in 2017, and today, the country has over 200,000 patients in a population of 84 million. There’s plenty of opportunity there.
“With delays in the recreational framework, the medical sector has gained momentum. Doctors are becoming increasingly comfortable prescribing medical cannabis, especially since it has transitioned from being classified as a narcotic to a regulated substance.
“The medical community is more on board than ever before. I don’t see this changing in the next two to three years. If anything, the pressure and delays on the recreational side, including the scientific pilot projects we’re working on, will only reinforce the strength of the medical market.”
Aurora was one of the progenitors of this transatlantic cannabis supply chain, and was one of only three companies to be granted a tender to grow cannabis in Germany.
Last year, Germany scrapped the severely restrictive cap on those licensed to grow cannabis in the country, alongside the tender process to receive a domestic cultivation license.
In July, Business of Cannabis reported that Tilray, Aurora and Demecan, the winners of the first original tender, had all been granted the first licenses in half a decade to cultivate cannabis in Germany.
Now, Aurora first German-grown products are becoming available for German patients, but the company does not expect domestic supply to become a major factor in the country.
Martin explained: “What we’ve observed is that regulators, prescribing physicians, and patients all show strong interest in locally grown GMP-certified products. We’ve even had regulators from Germany and other countries visit GMP facilities, which speaks to the importance of in-country production from both a branding and engagement standpoint.”
However, while there are clear benefits to having in-country production presence, he conceded that he doesn’t see it ‘becoming a dominant part of our overall production portfolio’, given that there’s no regulatory advantage over cheaper imported goods.
He added: “When discussions around recreational cannabis were taking place, the expectation was that domestic production would be required. If that policy were to move forward in the future, we’d certainly evaluate the opportunity.”
Political shifts in Canada
Similarly to Germany, the upcoming election in Canada, expected to take place in October, could also alter this framework dramatically.
Should conditions improve for operators in the domestic market, the influx of Canadian cannabis into Europe could dwindle, but the outlook for any such changes remains murky.
Martin explained that Canada is a ‘complex story’, and while the country has ‘done more for recreational cannabis’ than any other, the government has largely left legislation alone since 2018.
As the political situation remains in a state of flux, he cautioned that assumptions a liberal-leaning government will champion cannabis can not be relied upon. On the other hand, a more conservative government could seek to reduce bureaucracy and simplify regulations.
“That said, I don’t expect the Canadian recreational market to improve anytime soon. However, medical cannabis remains our largest segment, where we hold the leading position in Canada, and we continue to see opportunities for growth.”
Zooming out, Martin says he is ‘incredibly bullish on the future of medical cannabis’, and that it is important to take a long-term view on the expansion of this relatively new market.
“Everyone needs to remember that we are still in the earliest stages of this industry. When you take a global perspective, it’s clear that thoughtful, science-based regulations have been implemented in some of the world’s largest economies.
“These are modern, well-structured frameworks, and none of them have been rolled back. Instead, they’ve been successfully implemented, leading to more patients and doctors embracing medical cannabis.
“That momentum isn’t going to reverse… The reality is, medical cannabis is here to stay, and its future is bright.”
