Canada embraces cannabis oil extracts and edibles

Executives of Organigram, a licensed cannabis producer based in New Brunswick, told the bold decision some 7 months before the Cannabis Act was even introduced and signed a product development and distribution deal with an American company that has a line of cannabis oil extracts and edibles because they knew edibles would soon be allowed on the markets.

Canada’s Standing Committee on Health has voted for amendment of the Cannabis Act which if approved by the House of Commons, will mean that cannabis edibles will be introduced to the Canadian market within a year.

That would mean the Organigram’s gamble has paid off.

Licensed producers have joined the chorus of cannabis advocates applauding the move; it would be a boon to Canada’s cannabis industry. In Colorado, Washington and Oregon, U.S. states in which concentrates and edibles are legal for recreational use, they accounted for more than third of overall cannabis sales in the first quarter of 2016.

The standing committee, which has heard from more than a hundred witnesses since it began studying the bill in August, approved the amendment after several witnesses told members that the move was necessary to address consumer demand for such products, to provide a healthy alternative to smoking cannabis and to help eradicate the black market—a stated goal of Prime Minister Justin Trudeau’s government.

“We heard from Public Health that limiting legalized cannabis to dried forms would encourage smoking, and there are significant public health consequences associated with smoking cannabis,” Committee member John Oliver, an MP in the governing Liberal Party, said when presenting the amendments. “We also heard from many consumer groups and users that they felt that having edibles was an important piece of them being able to properly utilize the drug.”

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Organigram CEO reacts

Organigram CEO, Engel has explained that his organization’s decision to go into partnership with a Colorado-based cannabis company was based on the fact that they knew the ammendment of the Act was only a matter of time.

“We knew through discussions with government officials that they were open to adding edibles and concentrates to the list of cannabis products that could be sold legally….These products are a huge part of the market in places where cannabis is legal for recreational use,” said Engel. “You can’t displace the black market until you make these products legal. The provinces have been learning more about the cannabis industry in the past year and they are looking forward to edibles and concentrates being on the market too, because they see how relevant these products are,” he said.

The deal Organigram signed with TGS last year ensures the Canadian company gets exclusive licensing of more than 225 cannabis products in this country and consulting services related to an extraction facility. The company plans to build up that facility on recently acquired land “at the appropriate time.”

Engel says Organigram would be able to introduce edibles and concentrates to the market within months of the government making them legal for recreational use. He adds that the company is now considering which products to introduce. “We know that pens and prefilled cartridges are [big sellers] in this category and that brownies and cookies are also popular. We could offer a broad range of these products,” he says, adding that beverages would be introduced “later down the road.”

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Executives at Ontario-based MedReleaf, another licensed producer, are equally enthusiastic “I think the introduction of this amendment is fantastic.

Legalization is driven by the desire to get rid of black market — and that market has a full product selection of edibles and concentrates,” Darren Karasiuk, the company’s vice president of strategy, told Leafly. “To compete with the black market and to achieve policy goals, you need to offer consumers what they want and could get on the black market. It’s an incredibly important step.”

“We’re going to explore the landscape and make plans as the regulatory environment evolves,” Karasiuk said when asked about his company’s plans regarding edibles and concentrates. “We will look at all opportunities.”

The House of Commons will vote on the amendment during the third reading of the Cannabis Act, after which the proposed legislation goes to the Senate for final approval.

This story was produced by with additional information from Leafly.

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