The Pending Spanish Paradox

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The Spanish government is finally voting to legalize medical cannabis at the end of June – but only for exporting cultivators

The land of the cannabis club is moving forward, albeit frustratingly, on medical cannabis reform. Namely, if everything goes as planned, the Spanish government will finally vote to legalize the cultivation of medical cannabis at the end of June. Further, they will also issue (more) licenses for EU GMP cultivation. There are currently four – and the Spanish authorities have steadfastly refused to issue any more for the past five years (at least in the past) citing concerns that they will just be resold.

It would appear those days are over. However, the basic rules for the market will remain the same. Firms may be able to gain cultivation licenses more easily, but everything they grow they must export.

That is not a real change from the status quo now. In fact, it could be argued that this is just a federal vote to preserve the status quo.

Patient access will not be any easier – and presumably could be worse – because patients will have to go through the formal medical system – or the clubs. Cost will remain a major impediment.

Just Like Holland and Greece Used to Be

No matter how far the now pending proposals push the conversation, it is an inherently limited one. Namely, this is a cynical proposal to pass legislation that won’t change what already exists now. Cultivation licenses might be more available – but they will still only be accessible to those with the budgets to set up EU GMP facilities. And as Greece found out, setting up an infrastructure to attract foreign investment in cultivation and extraction only goes so far when the sole business model is to supply those out of the country.

In fact, it appears that Spain is currently on track to have a two-tiered production model. The pharma grade one – and the grey market one that services the clubs. This also did not work in Holland.

Why Is Spain Lagging Behind on Reform?

There is only one answer for why the Spanish government has consistently failed to forward the industry in an environment where approximately 90% of the population believes that at least medical cannabis should be legal. And that is that the government has not learned the lessons seen in other legalizing countries (even though they will be establishing a panel to explore that specifically as of the end of this month).

It is also obvious that the country is in a holding pattern – waiting for Germany to flip the switch to recreational. Once that happens, given the amount of German money in the Spanish economy, it may be that Spain will follow. They are certainly not leading.

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