Medicinal cannabis and hemp could generate $3 billion in investments

Charles Vilela

The developments that may arise from the approval and sanction of the bill that will regulate the cultivation, processing, research, production, and commercialization of cannabis-based products for medicinal and industrial purposes are diverse and span various sectors. The main one, obviously, is in the health area. Patients using CBD for treatments will have easier access to products. Additionally, there should be improvements in production diversification and cost reduction, as cultivation and processing can be done in Brazil.

Secondly, but no less relevant, especially given the difficult economic situation the country is facing, is the development of new businesses and the attraction of external investments. If the project is approved, Brazil will be entering a new and promising global market, capable of standing out as one of the main players, with the competence and capacity to develop medicinal cannabis and industrial operations from hemp. 

The expectation is that in just the first three years, the businesses generated by the segment could attract investments of at least $3 billion. “Brazil is a strong candidate to capture these resources, mainly due to the planting conditions we have here,” points out Jaime Ozi, partner and vice president of Business at OnixCann, a company focused on the production of medicinal cannabis. “In our country, we do not have problems with heat or cold, there is quite interesting solar exposure throughout the year, and land restrictions are minimal. We have an abundance of water and an enviable agricultural know-how, with institutions like Embrapa. So, Brazil has, in all aspects, the conditions to lead this process.”

Ozi highlights that the main advancement brought by PL 399/2015 is in the regulation for cultivation and its variants, something that was left out of the RDC 327 norm from Anvisa, which created the special category of products for medicinal cannabis. “This gives Brazil the possibility of having a new economy through cannabis cultivation, not only of the plant but also of hemp,” he says. “The study led by deputies (Luciano) Ducci and (Paulo) Teixeira went in-depth on the issue. They visited countries like Colombia, Uruguay, and Canada and practically raised the main issues related to the product.”

He believes there will be significant development in the medicinal sector, but other areas such as cosmetics and food industries will also be highly benefited, as these sectors will gain access, through cannabis seeds, to a high-quality protein rich in omega 3 and 6. Thus, there will be products available in areas that currently do not exist due to the prohibition of cultivation. “The little that exists today (in the market) is imported. Now we will have the possibility of developing a local industry.” 

He predicts that if the process of liberating and planting medicinal cannabis and hemp is well developed, it will enable the development of family agriculture with high added value. This should generate jobs on one hand, and taxes for the government on the other. “There will be a strong social impact in job generation and greater retention of workers in the countryside,” he emphasizes, recalling that there is currently a problem of low added value in agricultural production in large-scale crops like soy and corn. This will be different in the case of cannabis. “With small areas in family agriculture, we will produce a high-quality and high-value product.”

For Werner Buff, a lawyer specializing in business law and head of legal affairs at Verdemed, the approval and sanction of PL 399/2015 will change not only the consumption and access to health products for patients who need these treatments but also how the industry behaves. “A completely new industry will be created, with various players,” he projects. 

In the European Union, the cultivation of cannabis is already regulated. The U.S. has state regulations and is moving toward federal regulation. All countries in Latin America have regulations, where there is already a relatively mature industry happening. “We will be inserted into a market that is already global, existing in various places, at different levels of maturity. This will allow Brazil to do business with other countries, whether exporting raw materials or exporting or importing semi-finished or finished products, entering this global chain of medicinal cannabis.”

Buff praised the work of deputies Luciano Ducci (PSB/RS) and Paulo Teixeira (PT/SP) in formulating the substitute for project 399/2015, respectively the rapporteur and president of the Special Commission on Formulated Medicines with Cannabis, for having listened to all the stakeholders involved in the topic, such as the industry in general - including pharmaceutical and industrial - patients, and consumers. “It is a very centered and balanced project. I think that for the moment we are living, it is a very well-rounded project for the needs of Brazil and the patients who consume these products. The president and the rapporteur did a spectacular job.”