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Patient Advocate since 1977.


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US – German Cannabis Producers Can’t Do Business Together, Here’s Why – by Michael Knodt @ marijuana.com

US, German Cannabis Producers Can’t Do Business Together, Here’s Why


BY MICHAEL KNODT ON

Bureaucratic hurdles and an unexpectedly high demand for medical cannabis in Germany have created a bottleneck that’s plagued cannabis patients and producers alike. It would seem as though working with the United States could alleviate some of the pressure, but the federal government in Germany has avoided working with the country’s producers for fear of violating the United Nations Single Convention on Narcotic Drugs.

Until Germany can develop a robust cannabis cultivation industry, its patients will continue to receive their medicine sporadically from Canada or the Netherlands. While 18 varieties of cannabis are supposed to be available, patients are lucky to find four strains at their local pharmacy — a significant issue when German doctors are required to prescribe a specific strain for patients. If that strain’s not available, the prescription is worthless.

Once the Israeli government has defined their guidelines for cannabis export, their medical cannabis will find its way into German pharmacies to help alleviate the recent bottlenecks. Israel is expected to develop a cannabis export system in the next couple of years.

Cannabis farmers in the U.S. West Coast, Nevada, Colorado, and Alaska might welcome the opportunity to expand into international markets, and patients in Germany could benefit from the new, highly effective selection of U.S. cannabis strains. But the United Nations Single Convention on Narcotic Drugs labels cannabis on par with cocaine and opium — therein lies the problem for Germany doing business with U.S. cannabis producers.

The Single Convention on Narcotics and Drugs of 1961 is still the foundation of worldwide drug legislation. It includes the coca, opium poppy, cannabis, the opium plant’s raw materials, opiates, heroin, and some synthetic opioids such as methadone. The Convention on Psychotropic Substances of Feb. 21, 1971 extended the list of controlled substances to include psychotropic substances such as amphetamines, barbiturates, and LSD and came into force on Aug. 16, 1976.

Only the medical use of narcotics for pain relief is excluded from the Convention but has to be enacted in compliance with the measures deemed necessary by the United Nations (UN). Member nations must report their produced, exported, stored, and used narcotics to the Narcotic Control Council.

A State Must Purchase All Medical Cannabis Crops

Article 23 of the Single Convention states:

A Party that permits the cultivation of the opium poppy for the production of opium shall establish, if it has not already done so, and maintain, one or more government agencies (hereafter in this article referred to as the Agency) to carry out the functions required under this article.

Article 23 (2) (d) says: “All cultivators of the opium poppy shall be required to deliver their total crops of opium to the Agency. As soon as possible, but not later than four months after the end of the harvest.”

According to Articles 26 and 28 of the Single Convention, the same control system applies to coca and cannabis. Health Canada is in violation of Article 23, paragraph 2d for allowing producers to sell directly to patients. Unlike the Office of Medical Cannabis (OMC) in the Netherlands, the Canadian agency does not purchase and sell the licensed producers’ crops.

The establishment of such an agency is independent of whether government institutions or licensed private providers take over the cultivation. Such agencies only exist in the few states where opium, coca, and cannabis are grown legally: The Turkish Grain Board (for Opium in Turkey), Health Canada’s Office of Controlled Substances, the National Institute on Drug Abuse in the U.S., the Federal Institute for Drugs and Medical Devices (BfArM) in Germany, the Austrian Agency for Health and Food Safety, the Office of Medicinal Cannabis in the Netherlands, the Czech State Agency for Medical Cannabis, and the Medical Cannabis Unit in Israel.

The U.S. government would have to recognize the medical benefits of cannabis and remove the drug from Schedule 1 of the narcotics act before the NIDA could offer medical cannabis for export to the German BfArM.

Ways Around the Single Convention

It is almost impossible for a member of the United Nations to legalize cannabis without coming into conflict with the international community. Uruguay, Bolivia, and Canada have already had to deal with the issue and have each taken different approaches to reconciling new national policy with existing international agreements.

Out and Back In

In 2009, the Bolivian government proposed deleting some provisions regarding the coca leaf, but the proposal was rejected by the other member nations. On June 29, 2011, Bolivia withdrew from the Single Convention through Jan. 1, 2012 and rejoined with an objection to Article 50 on Jan. 10, 2012.

Bolivia stated that it would allow the cultivation, trade, and consumption of coca leaves in its country. Within one year, 15 contracting nations filed an objection, well short of the one-third quorum required to reject Bolivia’s objection. Bolivia was reclassified as a contracting party on Jan. 11, 2013.

Ignore the Issue

Uruguay was reprimanded shortly before the legalization of cannabis by the UN Drug Administration’s International Narcotic Control Board (INCB). The former INCB-president Raymond Yans accused Uruguay’s then-president Jose Mujica of having an “attitude of a pirate” because his government legalized cannabis. Mujica fiercely resisted the allegations repeatedly made against his country and publicly responded to the criticism of the former INCB chairman:

“Tell the old man to stop lying. We can meet whenever he wants in Uruguay. […]. He sits in a comfortable position on the International stage and believes he can tell nonsense.”

Despite the dramatic exchanges, the international community has not sanctioned Uruguay for being the first country in the world to legalize cannabis. Incidentally, a similar complaint was addressed to the United States after the legalization ballots in Colorado and Washington State. In November 2012, Yans stated the legalization of the cultivation and possession of cannabis in Colorado and Washington violated the treaty and asked the U.S. government to restore conformity with the single convention.

Recreational cannabis is legal in eight states and the District of Columbia, and the international community is far from sanctioning the U.S. However, ignoring the treaty also means missing out on access to the international market and the opportunity to take part in international research efforts.

Don’t Comply, Justify

At the 59th meeting of the United Nations Commission on Narcotic Drugs in March 2016, Undersecretary for Health of Canada Hilary Geller expressed Canada’s interest in international cooperation and made it clear, “the Government remains committed to strong international cooperation to combat the world drug problem and wherever possible, will seek to align its objectives for a new marijuana regime with the objectives of the international drug control framework and the spirit of the Conventions.”

Canada is the first to take the position of “non-compliance.” With Geller’s announcement, Canada has laid the foundation for an ongoing debate on how to regulate cannabis at the national level without violating international legal obligations.

Change

Even if the 1961 Single Convention could be amended, that would involve a complex, years-long process.

Canada could set a precedent in July 2018, by forcing the U.N. to rethink the position of cannabis for the first time since 1961. The aim of the process would be to give all member nations the opportunity to regulate recreational and medical cannabis in the future. Legislation in international agreements is never set in stone, it can be changed any time the democratic will of the member nations demands it.
ABOUT AUTHOR
Michael Knodt is an expert on cannabis politics and cannabis culture across Europe. Born in North Germany, Michael has been living in Berlin since 1990. He initially studied history and journalism before receiving his certification as a carpenter. Since then, Michael has made regular visits to countries where cannabis is cultivated, such as Jamaica and Morocco. He has worked as a freelancer for Weedmaps, Vice Magazine Germany, Sensi Seeds and numerous German-language cannabis magazines since 2004. From 2005 to 2013, Michael was the Editor-in-Chief of Germanys biggest cannabis periodical. He also is the face and presenter of the most popular program on cannabis prohibition and just launched a new channel called “DerMicha.” Aside from his journalistic work, Michael is a cannabis patient, activist, sought-after speaker on conferences and congresses, and a father of two.

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Regulation in Germany….and we aren’t talking about soccer :)

The current regulation in Germany made it difficult for German companies to apply to get a license for Cannabis cultivation.

** And that is why the process is now held up in litigation in the German court system. One of the unsuccessful bidders has sued over the requirements and the entire application process is on hold, with any potential awards being made in Q1 or Q2 2018 at the earliest.

What is the most popular model for cannabis cultivation in Germany, so far?
The cultivation in Germany is currently not legal, done outdoors and indoors and hidden from sight and smell as best as possible.

There is no legal German cultivation currently allowed, even for patients with valid medical approvals.

There is small cultivation being done as part of R+D projects in Universities and Scientific companies.

Regarding joint ventures: How do foreign cannabis companies usually work together with German companies?

In various ways, based on their business objectives and strategy. Three examples are:

Canopy Growth Corporation purchased a German firm Medcann, which became Spektrum Germany. They are considered by many to be the premier cannabis firm in Germany today.

Maricann of Canada purchased a former cargo facility in Dresden for 3€ million and is ramping up their European operations, adding staff, and building out their new European headquarters.

An international firm is currently in discussions with a German startup, to establish a joint venture partnership which will make news around the world. This partnership should be made public in early 2018 and will be ground-breaking.

To cover the demand of medical cannabis Germany is importing from other countries. Supply is coming especially from Canada. Which other countries might be relevant cannabis suppliers in the future?

Canada and The Netherlands are currently the only authorized countries to import into Germany. Supplies are seriously constrained and with Canada becoming a legal recreational country in July 2018, the supply bottlenecks are expected to be exacerbated well into 2019.

Tilray has announced plans to establish a cultivation facility in Portugal to supply the German, and European market in the future.

The governments of Greece, Israel, South Africa, Australia, Chile, Uruguay, and others are currently working with private sector companies to establish their own cultivation and export capabilities.

Germany, with twice the population of California, is a key market for any serious player in the global cannabis industry.

What is your personal opinion about the current German regulation. What will be the next major steps?

Regulation and taxation is always better than the illegality and violence of the black market. Always.

Thank God for the German court system which has brought legalized medical marijuana to the people, if it were up to the politicians, we would still be waiting.

Now the intelligent implementation of recreational laws need to be established to legalize the plant which has been used for thousands of years.

Reducing opioid deaths, helping certain people with their medical conditions, and enabling super-straight people to enjoy jazz music are just some of the benefits of a world where ganja is regulated, safe, and profitable.

The flower of cannabis will always have a place in the market, but in the next years we will see an increase in other forms of cannabis that are more easily consumed….edibles, oils, salves and the like. As a result, GMP (Good Manufacturing Process) certification is going to become very important for those wanting to establish a quality product in the German and European markets.

And if we look at the European Cannabis market. Which major market trends do you identify?

1- Everyone seems to be focusing on cultivation, but this segment is expected to become a commodity item in the near term. Companies may want to look at establishing a product line including “finished products with GMP certification” to become a leading force in this market.

2- At some point the insurance companies are going to become true partners in providing cannabis therapies to the German pharmacies. This will happen as a result of cost-savings and health-benefits realized vs. the current pharmaceuticals offered to patients.

3- In the words of Peter Tosh:
“Legalize it.”

The Berlin Peace Accords (attached) calls for an end to the 80 year World War On Cannabis, and we agree. Legal, regulated, safe and non-violent recreational marijuana markets have already been established in the US and Uruguay, with Canada and others joining the party in 2018.

Pharmaceutical companies don’t like it, Beer companies don’t like it (although the owners of Corona beer just invested $250 million in Canopy Growth’s cannabis business last month) and some short-sighted politicians don’t like it. But “We the People…” have made our opinions known and the calls for a rational, legal, safe and non-violent cannabis market is just a few moments away here in the center of Europe.

These are historic times, Germany is leading the world in many ways, 2018 will be an interesting year.

peace,
Phil


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Kai-Friedrich Niermann has a really good update on the potential for legal cannabis here in Germany…….news on the “Jamaica Coalition” is expected within hours,……..more later. – Phil

https://www.kfnplus.de/jamaica-current-german-coalition-and-cannabis-control-act/#comment-2

Jamaica [Current German Coalition) and Cannabis Control Act

Annotation on practical implementation by Kai-Friedrich Niermann, Attorney, Paderborn [Germany]

Let‘s say the coalition partners part this evening and determine the uptake of coalition negotiations. And let us furthermore assume The Green Party with tie-in of FDP achieve Cannabis liberalisation in full as well as pushing through their Cannabis Control Act in the negotiations going on from mid December until shortly before Christmas. And also let’s assume the Cannabis Incorporate Act is then voted in by Bundestag in May or June [2018]; then Germany will be faced with even more massive changes and the latter in various sectors.

The Cannabis Law includes the option of applications for cultivation licences (farming), wholesale trade licences as well as retail licences such as specialist shops. In addition to this import and export licences can be applied for. Expert prior knowledge is not required and simply personal trustworthiness as demanded within public-houses law is stipulated. Business owners must not have previous convictions.

Assuming a conservative estimate of 10 t of Cannabis per week being consumed in Germany this results in an annual demand of 520 t. The production of Cannabis is deemed to result in a harvest of 440 g per m² within a harvest cycle of 52 days which allows for 7 harvests per year. To cover 107% consumption of Germany an acreage of 180.000 m² would be prerequisite.

Breaking down and allocating these figures to an average municipality such as Paderborn with a population of 140.000 this would result in a required cultivation acreage of 307 m².

With the scheduled Cannabis Control Act tax of 4€/g provided by statute, 1€/g for production costs, 2€/g for wholesale trade and also 3 €/g for specialist shops this results in a price of 10€ in total per gram which is equivalent to the current black market price. It will be a balancing act not to drive the price to high to enable draining the black market effectively as intended.

For Paderborn alone and at this retail price it would amount to a turnover for cultivation/farming of approx. 890.000 €, 1,8 million € for the wholesale trade and 2,6 million € for specialist shops.

However the Cannabis Control Act provides for numerous regulations as to Quality Assurance, protection of production lines, safeguarding of youth protection and prevention. Consequently production facilities must be secured with fences and alarm systems. Transport of Cannabis is governed by specified security restrictions, the specialist shops must train their personnel and deliver proof for consistent follow-up trainings as well as a substantial social concept. Also packaging has to be secured to a high extent and must feature comprehensive warning and reconnaissance information.

It remains doubtful that the current illegal Cannabis producers will meet these requirements in full and step out from illegality. For this reason it is to be expected that capital investors who with their capacity are able to administer the task more economically will edge into the market.

Then within the 2nd half of 2018 the race for the desired licences for farming, wholesale trade, import, export and specialist retailers would begin.

Restrictions as to numbers of licence permits are not scheduled within Cannabis Control Act so any desired number of farming facilities or specialist retailers could operate. Indeed we may assume that the Authorities will initially be totally snowed under and will authorise thoroughly drawn up applications at first which are based on convincing technical programmes and a business plans.

Any potentially interested party striving to be a player in this new and strictly regulated market is to focus on the new situation just in time and develop technical and operational concepts, investment concepts as well as calculations of overall return on investment as well as liquidity calculations. And just in time could „slip into gear“ as from tomorrow morning!

RA Kai-Friedrich Niermann

http://www.kfnplus.de

k@kfnplus.de

+491773108923

Jamaika und das Cannabiskontrollgesetz

English Version

Einige Anmerkungen zur praktischen Umsetzung, von Rechtsanwalt Kai-Friedrich Niermann (Paderborn)

Nehmen wir einmal an, die Jamaika-Koalitionäre gehen heute Abend auseinander und beschließen die Aufnahme von Koalitionsverhandlungen. Nehmen wir weiter an, dass die Grünen im Verbund mit der FDP es schaffen, die vollständige Freigabe von Cannabis zu erreichen und ihr Cannabiskontrollgesetz in den Verhandlungen von Mitte Dezember bis kurz vor Weihnachten durchbringen. Nehmen wir weiter an, dass das Cannabiskontrollgesetz dann vom Bundestag im Mai oder Juni beschlossen wird, dann stehen Deutschland große Änderungen und in vielen Bereichen noch größere Herausforderungen bevor.

Das Cannabisgesetz sieht die Möglichkeit der Beantragung von Anbaulizenzen, Großhandelslizenzen sowie Einzelhandelslizenzen, sogenannte Fachgeschäfte, vor. Ferner können Einfuhr und Ausfuhrlizenzen beantragt werden. Besondere Vorkenntnisse sind nicht erforderlich, es muss lediglich die üblicherweise zu verlangende Zuverlässigkeit, wie im Gaststättenrecht zum Beispiel, vorliegen und beim Geschäftsinhaber dürfen keine einschlägigen Vorstrafen bestehen.

Geht man nach konservativen Schätzungen davon aus, dass pro Woche 10 t Cannabis in Deutschland konsumiert werden, ergibt dies einen Jahresbedarf von 520 t. In der Produktion von Cannabis geht man davon aus, dass ein m² einen Ertrag von 440 g erbringen kann, was bei einem Erntezyklus von 52 Tagen ca. 7 Ernten pro Jahr ermöglicht. Man benötigt also allein 180.000 m² reine Anbaufläche, um dem Bedarf von Deutschland zu 107% zu decken.

Bricht man diese Zahlen auf eine durchschnittliche Kommune wie Paderborn mit einer Einwohnerzahl von 140.000 herunter, ergäbe dies eine benötigte Anbaufläche von 307 m². Bei einer im Cannabiskontrollgesetz vorgesehenen Steuer von 4 €, bei Produktionskosten von 1 €, bei Kosten für den Großhandel von 2 € sowie bei Kosten für die Fachgeschäfte von 3 € pro Gramm ergebe sich ein Grammpreis von insgesamt 10 €, der dem Preis auf dem derzeitigen Schwarzmarkt entspricht. Der Spagat wird sein, den Preis nicht zu hoch zu treiben, um auch tatsächlich, wie beabsichtigt den Schwarzmarkt austrocknen zu können.

Allein für Paderborn ergebe sich bei diesem Verkaufspreis ein Umsatz beim Anbau in Höhe von ca. 890.000 €, beim Großhandel von 1,8 Millionen €, und bei den Fachgeschäften von 2,6 Millionen €.

Das Cannabiskontrollgesetz sieht allerdings zahlreiche Vorschriften bezüglich der Qualitätssicherung, der Sicherung der Produktionsanlagen, der Sicherung des Jugendschutzes und der Prävention vor. So müssen die Produktionsanlagen mit Zäunen und Alarmanlagen gesichert werden, der Transport von Cannabis unterliegt bestimmten Sicherheitsauflagen, die Fachgeschäfte müssen ihr Personal am Beginn schulen und regelmäßige Nachfolgeschulungen nachweisen sowie ein umfangreiches Sozialkonzept erstellen. Ferner müssen die Verpackungen umfangreich gesichert und mit zahlreichen Warn- und Aufklärungshinweisen gestaltet werden.

Ob es für die zahlreichen, bisher illegalen Cannabisproduzenten möglich sein wird, diese Anforderungen in Gänze zu erfüllen und aus der Illegalität herauszutreten, bleibt zu bezweifeln. Es ist daher zu erwarten, dass große Investoren mit größeren Anlagen auf den Markt drängen werden, die allein aufgrund ihrer Kapazität in der Lage sind, kostengünstiger zu wirtschaften.

Sodann würde im 2. Halbjahr 2018 ein Wettlauf um die begehrten Lizenzen für Anbau, Großhandel, Import, Export und Fachhandel beginnen. Eine zahlenmäßige Beschränkung der Erlaubnisse ist vom Cannabiskontrollgesetz nicht vorgesehen, es können also beliebig viele Anbauflächen oder Fachgeschäfte betrieben werden. Allerdings ist davon auszugehen, dass die Behörden zunächst völlig überlastet sind und die Anträge zuerst genehmigen, die vollständig ausgearbeitet sind und denen ein in technischer und betriebswirtschaftlicher Hinsicht überzeugendes Konzept zu Grunde liegt.

Es ist somit allen Interessenten, die in diesem neuen, strikt regulierten Markt agieren wollen, sich rechtzeitig auf die neue Situation einzustellen und bereits jetzt technische Betriebskonzepte, Investitionskonzepte und Rendite- und Liquiditätsberechnungen zu entwickeln. Die Zeit könnte ab morgen früh zu laufen beginnen.

RA Kai-Friedrich Niermann
http://www.kfnplus.de
k@kfnplus.de
+491773108923


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MERKEL GETS RELIGION on the 500-year anniversary of Martin Luther’s Reformation project. Legalized marijuana in Germany now on the horizon.

Cannabis Consultant in Germany

Cenedella.DE

October 31, 2017

As many Americans start the day making plans for Halloween 2017, the folks here in Germany have the day off of work to celebrate the 500-year Anniversary of Martin Luther’s project to reform German society. Surprisingly, the newspapers today also announced Chancellor Angela Merkel’s intentions, along with her new coalition partners called the “Jamaican coalition” to consider legalizing marijuana.

Seems an unintended benefit of the AFD’s victories in the last elections, is the CDU ruling party is now more receptive to working with those with divergent views in order to maintain their leadership position.

Could this really be the start of the Reformation of the 20th century drug laws in Germany and beyond?

Has the work of the DHV in Berlin and their partners finally started to pay dividends?

Was the signing of the BERLIN PEACE ACCORDS http://www.berlinpeaceaccords.de , which begins with “We the people of the Year 2017 do…
Hereby declare that it is our inalienable basic human right to have the freedom to grow, medicate and enjoy the plant we call Cannabis, without any governmental limitations.
We demand our plant has no more regulations or limitations than a tomato plant…..” really have been the precursor to this historic moment?

Good questions, time will tell, but for sure our collective efforts as cannabis business executives are starting to pay dividends.

The month of October had started off with over 350 doctors, scientists, investors and industry professionals waking up in view of the massive Cologne Cathedral, which is truly an amazing sight to see in person! The International Association for Cannabinoid Medicines’ (IACM) CANNABINOID CONFERENCE was held in downtown Cologne bringing together experts from Canada, Australia, Germany, and from throughout the world. Their website is http://www.cannabis-med.org and three take-aways were:

The idea that “Marijuana has no medicinal value” was pretty much, fully debunked 😊

The breath and quantity of existing “clinical trials” on our plant is amazing.

Meeting Josh Stanley, whose company has arguably helped more medical marijuana patients than anyone, was a privilege. CW Hemp’s team continues to lead the industry in many ways,…and additionally they are simply very cool people.

Later in the month, the folks from the regulatory and compliance organization ASTM came to Berlin for a 2-day intensive session for their new “Technical Committee D37 on Cannabis” section. You know we are becoming a real industry when 2 days is spent talking only about compliance related issues. Half the group was from Germany, including executives from the first licensed marijuana testing facility located within Germany, scientists from the University of Berlin currently working on marijuana clinical trials, and a few of the leading homegrown companies on the front lines including ABCann Germany, MH Hemp, Pedanois, and two guys who reminded me of what a young Ed Rosenthal would be like. 😊

So as November 2017 begins, many of us will meet in Berlin this weekend for the first annual DHV Convention. Their website is https://hanfverband.de and they are unequivocally the leading organization for marijuana reform in Germany today. This convention will probably confirm these four truths of the marijuana landscape in Germany today:

Canadian firms are kicking butt!
They understand the requirement of GMP certification, their government is supportive of providing qualified companies an export license for their THC-based products, and their executives are damn smart.

German firms are coming of age, are intelligent and committed.
The first DHV convention will be highlighting the work of patient advocates, industry professionals, knowledgeable physicians and forward-looking politicians involved in building this new industry within the German borders.

The European, South American, African, Israeli and Australian firms are all actively making plans to succeed.
Governments, investors, and executives from throughout the world are looking at Germany and making their plans to enter the European market with its 750+ million potential customers. They are forming strategic partnerships, investing in commercial facilities, and making Europe a priority for 2018.

The USA is an abysmal no-show in the game.
America started the war on Marihuana last century, and somehow tries to keep the war alive today. Scientist, Stoners and Society have evolved quite a bit since the 1930s. The Germans have taken note, changed course in their direction, and their people will be better off as a result.

Maybe now it’s time for President Trump get religion and start his own Marijuana Reformation project?

– Philip J. Cenedella


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Germany’s largest legal cannabis plantation – by VICE Magazine

https://www.vice.com/de/article/qvjge5/weed-aus-dem-atombunker-dieser-typ-baut-deutschlands-grosste-legale-cannabis-plantage

http://www.bunker-ppd.de/

Germany’s largest legal cannabis plantation
Tim Geyer
Oct. 17 2017, 3:20 pm
Because of grass dealings, Christoph Roßner had already been in prison for five months. Today he works with Bavarian politicians.

This is not really a loose work place, even if grass is to be cultivated, says Christoph Roßner. The Atombunker, before which he stands, is squeezed between car parks and fields in the Allgäu countryside like a stranded oil tank. Here, from the former Fliegerhorst Memmingerberg NATO would have led the nuclear counterattack, had the Cold War escalated. Today the entrepreneur wants to breed cannabis in the bunker. Green haze instead of black rain – within sight of a federal police station and with the blessing of the Bavarian government. Since the beginning of the year, cannabis is legal on prescription in Germany and Rossner’s sentiment is that of a brewer’s owner after the end of the prohibition: “We have the chance to become one of the biggest players in the international cannabis market.”

Alone for 2015, the German Monitoring Center for Drugs and Drug Abuse (DBDD) counts almost five million Germans who have consumed cannabis at least once during the last twelve months. The dark figure should be even higher. Activists and businessmen have taken this first step towards legalization. Christoph Roßner is both. And also looks like this: black jacket over black sweater, the gray hair tamed to the horse tail. Business in the front, party in the back.

One of the many lock gates between the individual bunkers
From the war machine to the grass factory

The bunker, a 50-meter-long, 15-meter high colossus, with its aerial storms acts like a medieval fortress. From 1985, the Luftwaffe soldiers of the Jagdbombersgeschwader 34 were sitting here, servicing the control systems for the nearby rocket silos. “This bunker is safer than a nuclear waste disposal site, but we want to grow plants here,” says the 47-year-old. He has previously registered with the neighboring Federal Police Station on the visit of the journalists.

The Panzertor groans aside. 175 tons of hardened steel, eight meters wide, nearly one meter thick. A siren howls like a submarine on a dive. Through the opening one reaches the actual bunker, which surrounds the outer wall as the reactor coherent of Chernobyl. Then another lock door, another 30 centimeters of steel. Later, 15 employees of Roßner’s company Bunker PPD, which he wants to adjust, will change the street clothes against overalls without bags and scan their fingerprints. The few, the income, will be nothing to take with. Roßner leads past former team rooms and the radio center, a five-meter-thick steel-concrete ceiling above us. You go ducked, even though you do not have to.

But no matter how many nights Roßner is working on his business plans, in the end others decide: the Federal Institute for Drugs and Medical Devices and the Bundespiumstelle, which is subordinate to him. Anyone who wants to produce or use drugs in Germany must either talk to them or seek a good lawyer. But once the TÜV seal of the Panzertür has expired, once the officials discover a tiny mistake in a request: the bureaucrats are editing Roßner, the changing Würgreiz for CSU politicians, so meticulously as if they Franz Josef Strauss’ last will.

Where the radio had previously been monitored, a cannabis laboratory could soon be available
From activist to cannabis entrepreneur

Roßner knows this. For the last three decades he has been working on the legalization of cannabis. Two key experiences are the reason: at 17 he smokes his first joint. He notes: Kiffen helps him to curb his hyperactivity. A year later a steel carrier crushed his left shoulder during his training as an industrial mechanic. Against the chronic pain smokes Roßner cannabis. To this day, now on recipe. “If you like, I’m just tight,” he says. In 1994, a friend of Roßner, who suffers from epilepsy, finds out that marijuana dampens his attacks. Roessner’s sister also suffered from epilepsy. For them, this knowledge comes too late. Two years before, she committed suicide. “I could have helped her,” says Rossner.

From this moment on, he is on a mission: He is worried about marijuana to help others, he says. “Illegal research” he calls this. At that time, as today, cannabis is prohibited by law in Germany. It is only since 1 March 2017 that doctors can prescribe – even without the hard-to-obtain exemption. Although in 1994, the Federal Constitutional Court ruled that a small quantity of cannabis can be carried with no prescription – depending on the federal state, between five and ten grams – this verdict does not, however, protect against criminal prosecution. This is what the courts alone decide. Roessner also knew about the risk, especially in Bavaria, When it is rumored that he is running a kind of private hemp pharmacy, more and more people are coming. Rheumatics, neurodermatitis, chemotherapy patients. And some policemen.

If at any time the electricity should fail, Roßner can take advantage of four diesel generators to supply his cannabis lantern with light
Roßner is sentenced: two years and one month. He spends five months in prison and four in therapy. It’s been 17 years now. When he rages, he knocks again at his doorstep. Still, people who have pain are coming. Roßner does not do any illegal business, he continues to believe in the medical benefits of cannabis. Together with the Chair of Chemistry at the Technical University of Munich and the University of British Columbia, he is currently preparing a study to investigate the effects of the most important medicinal hemp varieties and to develop quality standards for them. 150 patients he wants to provide cannabis from his bunker. Will the study and the necessary hemp cultivation be approved, this would be his first decisive step to enter the medical cannabis market. The study is intended to prove that he, the ex-prisoner, is serious.

Politicians, investors and business bosses listen to him

By working with the universities, Roßner hopes that the newly established state-owned cannabis agency will choose him to produce state-certified grass. The agency is to provide patients with marijuana from Germany and is looking for producers all over Europe. In addition to Rossner, other German entrepreneurs are also applying, for example SensHemp from Berlin and Hanf AG from Hamburg. 2,000 kilograms per year, the agency estimates, would have to grow on German plantings in 2021 and 2022 to supply all patients. Roßner believes that German patients need six times a year: over 12 tonnes of grass. If no one has to apply for an exemption, but only needs a prescription, more patients will take this step, he is sure. In addition, it would not be worth it to build a plant worth several million euros. But without permission for the study, he could set up his bunker to a very unpleasant country house.

Plantation air could soon flow through the ventilation towers
Just a strong CSU conservative helps him with his plan. Franz Josef Pschierer, State Secretary in the Bavarian Ministry of Economic Affairs, will bring him together with entrepreneurs and politicians from Bavaria in 2016. Roßner tells them about the unused economic potential, possible tax revenues and savings in the police and courts. “Without the help of the Bavarian government, no one would listen to me,” he says. He is now planning his cannabis breeding plant with ThyssenKrupp – and is holding talks with internationally active hedge funds. If they invest in it, the Free State of Bavaria could subsidize its business with about a quarter of a million euros. From tax money. Marijuana sponsored by Horst Seehofer.

In many places in the bunker the soldiers have left something behind
While Roßner sketched his battle plan for the next months, we descend deeper into the airtight crypt. There is neither mobile phone reception nor spiderwebs. Comic paintings on the walls testify to what the soldiers were busy with when they were bored to wait for the Third World War. In one room there are vault chambers, large as overseas containers. Here the mother plants could grow. “Lamps clean, connect ventilation, let’s go,” says Roßner, “more perfect conditions than here you will find nowhere.” A high-security laboratory is to move into the former squadron headquarters. Here, chemists could clone potent cannabis varieties. Next to it stands an industrial furnace, in which former toxins were destroyed at 900 degrees. In the future, the most serious of these will be burned. A few security doors: the space for the cuttings. “We start with 80 different varieties,” Roßner says self-confidently, as if he had the approval already.

In these cabinets Roßner wants to breed young plants
Race with the Dutch

Sometimes Christoph Rossner would ask the same as the early fans of Cherry Coke or anal whitening: When will the backward-looking Germans finally understand what the Americans have long been celebrating? In 29 out of 50 US states , medical cannabis has been allowed or grass has been fully legalized. In 2016, the industry generated sales of 6.7 billion US dollars . Until it is so far in Germany, Rossner will still have to smoke a few blunts on the recipe.

At the beginning of the year, he was sitting with his lawyers to prepare a lawsuit against the Federal Institute for Drugs, he tells us as we step out of the darkness of the bunker. The agency has asked potential medical producers that they have already grown, processed and delivered at least 50 kilograms over the last three years. How is he to apply, if exactly that in Germany so far was illegal, Roßner curses. It is not easy to get a mission in Germany for something that does not really exist at all.

Meanwhile, the authorities want to improve – a small victory, but Rossner is running out of time. The Dutch company Sensi Seeds systematically purchases small cannabis producers in the USA and is now pushing into the German market. Roßner does not want to be bought up. His research project will start in March, followed by commercial operations. He wants to make money himself and make the world a bit better with nothing but a few plants from a Bavarian atomic bomb.

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What Is Going On With Germany’s Cannabis Bid? By Marguerite Arnold

A number of setbacks, controversies and lawsuits keep the German cannabis market in limbo.

Germany is proceeding down the path to officially grow its own medical cannabis crops. Medical use became legal this year, along with a federal mandate for cheap access. That means that public health insurance companies, which cover 90% of Germans, are now firmly on the hook if not front line of the cannabis efficacy issue. As such, Germany’s medical market is potentially one of the most lucrative cannabis markets in the world, with a total dollar amount to at least challenge, if not rival, even California’s recreational market. Some say Canada’s too.

However, before “home grow” enthusiasts get too excited, this legislative move was an attempt to stymie everything but commercial, albeit medical production. Not to mention shut off the recreational discussion for at least another four years.

How successful that foray into legalization will be – especially given the chronic shortages now facing patients – are an open question. Not to mention other infrastructural issues – like doctor unfamiliarity with or resistance to prescribing cannabinoids. Or the public insurers’ so-far reluctance to cover it even though now federally mandated to do so.

Regardless, Germany decided to legalize medical use in 2017 and further to begin a sanctioned domestic cultivation for this market. The decision in the Bundestag to legalize the drug was unanimous. And the idea to follow UN regulations to establish this vertical is cautiously conservative but defendable. Very predictably German in other words.

Since then, however, the path has been far from smooth. Much less efficient.

Trouble in Germany’s Medical Cannabis Paradise
In April the government released its tender bid. And no matter how exciting it was to be in the middle of an industry who finally saw a crack of light, there were also clouds to this silver lining that promised early and frequent thunderstorms on the horizon.

By the time the tender bid application was due in June, it was already clear who the top firms were likely to be In fact, by the end of the ICBC conference, which held its first annual gathering in Berlin at the same time the bid tender was announced, the controversy was already bubbling. The requirements of the bid, for a laughably small amount of cannabis (2,000 kg), mandated experience producing high qualities of medical marijuana in a federally legitimate market. By definition that excluded all German hopefuls, and set up Canada and Holland as the only countries who could provide such experience, capital and backlog of crop as the growing gets started.

The grumbling from Germans started then.

However, so did an amazingly public race to gain access to the German market directly – by acquisition or capital expenditures that are not refundable easily (like real estate or even buyouts). The common theme? They were large amounts of money being spent, and made by major Canadian Licensed Producers who had the right qualifications to meet the standards of the bid. In fact, by the time the tender bid application was due in June, it was already clear who the top firms were likely to be. They were the only ones who qualified under the judging qualifications.

And while nobody would commit publicly, news of the final decision was expected by August. Several Canadian LPs even issued press releases stating that they were finalists in the bid. But still no news was forthcoming about the official list.

Delay, Delay and More Delay
A month later, as of September, and there was still no official pronouncement. Nor was anybody talking. BfArM, the regulatory agency that is supervising this rollout as well as the regulation of all narcotic drugs (sort of like a German version of the FDA) has been issuing non-statement statements since the late summer. Aurora, however, one of the top contenders for cultivation here, was quietly issued an ex-im license by both Canadian and German authorities. Publicly, this has been described as an effort to help stem the now chronic cannabis shortage facing patients who attempt to go through legitimate, prescribed channels. On the German side, intriguingly, this appears to be a provisional license. Privately, some wondered if this was the beginning of a backdoor approval process for the top scoring bid applicants for cultivation. Although why that might be remains unclear.

Whispered rumours by industry sources that wish to remain anonymous, have suggested that the entire bid is still hanging in jeopardy. Late in the month, rumours began to fly that there were now lawsuits against the bid process. Nobody had much detail. Not to mention specifics. But CannabisIndustryJournal can now confirm in fact that there have been two lawsuits (so far).

The summary of the complaints? It appears that two parties, filing with the “Bundeskartellamt” (or regulatory office focusing on monopolies and unfair business practices) did not think the bid process or scoring system was fair. And both parties also lost.

But as of mid-October, there is still no public decision on the bids. What gives?

Whispered rumours by industry sources that wish to remain anonymous, have suggested that the entire bid is still hanging in jeopardy. Even though the plaintiffs failed, some have suggested that the German government might force a complete redo. Others hint that it will likely be slightly revised to be more inclusive but the regulatory standards must remain. If a redo is in the cards, will the German government decide to increase the total amount of yearly cannabis to be delivered? At this point, it is only calling for 2,000 kg per year by 2019. And that, as everyone knows, is far too little for a market that is exploding no matter the many other obstacles, like insurance companies refusing to compensate patients.

What Is Behind The Continued Delays?
There are several theories circulating the higher levels of the cannabis industry internationally right now even if no one is willing to be quoted. The first is that the total number of successful applicants, including the recent litigants, will be slightly expanded, but stay more or less the same. There is a high standard here for the import of medical cannabis that the Germans intend on duplicating domestically.

The Comprehensive Economic Trade Agreement (CETA – the often controversial free trade alliance between Europe and Canada) is still in the final stages of approval.The second is that the German government will take its time on announcing the final winners and just open the doors to more imported product. This will not be popular with German insurers, who are on the hook to pay the difference. However with Tilray now on track to open a processing facility in Portugal and Canopy now aligned with Alcaliber in Spain, cross-continent import might be one option the government is also weighing as a stop-gap provision. Tilray, who publicly denied in the German press that they were participating in the cultivation license during the summer, just issued a press release in October announcing a national distribution deal to pharmacies with a German partner – for cannabis oil.

But then there is another possibility behind the delay. The government might also be waiting for another issue to resolve – one that has nothing to do with cannabis specifically, but in fact is now right in the middle of the discussion.

The Comprehensive Economic Trade Agreement (CETA – the often controversial free trade alliance between Europe and Canada) is still in the final stages of approval. In fact, on September 19, a prominent German politician, Sigmar Gabriel of the Social Democrats (SPD) made a major statement about his party’s willingness to support Germany’s backing of the deal. It might be in fact, that the German government, which is supportive of CETA, got spooked about the cannabis lawsuits as test trials against not cannabis legalization, but a threat to the treaty itself.

Quality control, namely pesticides when it comes to plant matter, and the right of companies to sue governments are two of the most controversial aspects of this trade deal. And both appear to have risen, like old bong smoke, right at the final leg of closing the cannabis cultivation bid.

Will cannabis be seen as a flagship test for the seaworthiness of CETA? On a very interesting level, that answer may be yes. And will CETA in turn create a different discussion about regulatory compliance in an industry that has been, from the beginning of this year, decidedly Canadian-Deutsch? That is also on the table. And of great concern to those who follow the regulatory issues inherent in all. Not to mention, of course, the industry itself.

Conclusions?
Right now, there are none to be had.

However at present, the German bid process is several months behind schedule as Canadian producers themselves face a new wrinkle at home – the regulation of the recreational crop in the provinces.

It is also clear that there are a lot of questions and not a whole lot of answers. Not to mention a timeline when the smoke will clear.

Marguerite Arnold
Founder
MedPayRx
Marguerite Arnold is an American expat now living in Germany. She has just recieved her EMBA from the Frankfurt School of Finance and Management. She has a 25 year background in both cannabis reform and technology. She has been covering the international marijuana industry as a journalist and author since 2014. She continues to cover developments in the industry as she launches her own cannabis-tech firm, a company called MedPayRx, which aspires to be the first insurance and banking solution for cannabis patients in the world.


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Peter Homberg is Partner and Head of the German Life Sciences Practice at Dentons, one of the top 10 global law firms present in more than 50 countries. He and his colleagues advise on Germany’s new regulations regarding the legalization of cannabis for medical use.

There are many unusual questions to be asked, so this time we caught up with a very different kind of expert: Peter Homberg is Partner and Head of the German Life Sciences Practice at Dentons, one of the top 10 global law firms present in more than 50 countries. He and his colleagues advise on Germany’s new regulations regarding the legalization of cannabis for medical use.

Peter, the effect and use of cannabis are highly controversial. What is the significance of cannabis for medical purposes and what does the legalization mean for patients?

Before the law was liberalized, patients who suffered from certain diseases, like multiple sclerosis, cancer or chronic pain, could only use cannabis if they had applied for a specific exemption at the Federal Institute for Drugs and Medical Devices (BfArM). As regulations were extremely strict, only a few hundred patients were granted the permission to use the cannabis plant for medicinal purposes.

So what does it do? The plant is famous for containing THC, short for tetrahydrocannabinol, which binds to specific cannabis receptors (CB) in the central and peripheral nervous systems. The activation of CB1 in the spinal cord, for instance, reduces the perception of pain. In terms of medical use this means that cannabis can give relief to people suffering from cancer, multiple sclerosis, chronic pain and other serious diseases

The change in law means that patients can now receive a prescription from their doctor. If the doctor decides that there are no therapeutic alternatives to alleviate the patient’s suffering, the prescription allows the patient to obtain cannabis at the pharmacy. Although the restrictions have been lifted slightly, these processes are still strictly controlled by the BfArM.

The change in German law means that cannabis can now be prescribed as a pain killer by GPs
What is the current state of affairs in regards to legislation and what is the legal process for obtaining a license to cultivate cannabis?

With the legalization of cannabis, the BfArM established a cannabis agency within the institution to organize and control the cultivation of cannabis for medical use. As a result, a public tender has been released, and numerous companies have applied for the cultivation license.

Companies have to abide to strict guidelines to obtain a cultivation license
Of course, the process is taking much longer than expected, as this is a totally new field and the BfArM is asking for very specific qualifications: A company needs to have had some kind of past experience with cannabis products, they have to own indoor premises for the cultivation of the plants and have specific security measures in place in order to qualify.

Although we don’t have companies in Germany that have experience with growing cannabis, we do have some that have imported the plants from outside of Germany. They have significant experience in handling the product, be it through packaging or security measures.

For example, here in Germany there is a subsidiary of a larger Canadian company that has been producing the plants to a large extent. So this is a great advantage for them as they can build on their experience in Canada and fulfil the necessary requirements to qualify as legal cultivators.

You’ve been able to legally smoke weed in the Netherlands since the 1970’s, other countries like Italy and Denmark liberalized the medical use years ago. Germany seems quite slow in catching-up, why is that?

The legalization of cannabis for medical use in Germany occurred through a chain of unforeseeable events
Germany has one of the strictest narcotic drugs laws in Europe. In my opinion, if the German Federal Administrative Court hadn’t made a very specific decision, then the changes in legislation would never have been made. But through a chain of unforeseeable events, the following occurred:

One of the patients who had received the exemption from the BfArM, started growing his own cannabis at home, stating that the exemption included not only the purchase, but also the cultivation of cannabis. When BfArM sent him a cease and desist order, he took the issue to court.

In the last instance, the court ruled in his favour. This meant that all people who had previously received an exemption from BfArM would be able to legally grow cannabis at home. As this ruling would have resulted in a loss of control by the BfArM and in extension the government, cannabis was legalized for medical use and the complete control over cultivation and distribution returned to the government.

What role is Dentons playing in this whole transition process?

First and foremost we have been informing our international clients on regulatory issues and the new legislation in Germany. With cannabis everything is new, it’s a completely new field and different from any other topic in the life sciences.

THC – tetrahydrocannabinol – binds to specific cannabis receptors in the central and peripheral nervous systems
We have an international cannabis group at Dentons that is at the forefront of current affairs and keeps up to date on the topic. Our work includes regulatory advice, mergers and acquisitions and intellectual property. For instance, we have advised clients, one of them a large Canadian company, on the acquisition of a cannabis distributor in Germany to get a strong foothold in the country and on the European market.

In future, we will also have to handle various disputes. It will be very interesting to see how they evolve, how to handle them and their outcome. If one company, for example, receives the permission to cultivate cannabis in Germany and others don’t, then these decisions will certainly be challenged.

What can Germany… what can Europe learn from Canada?

Canada is well ahead in the use of cannabis for medicinal purposes. What is happening in Germany now is following the Canadian pattern: Today, we have a tender in the public procurement field that came from BfArM. It invited qualified companies to put forward their bid on specific cannabis plants in order to sell these to BfArM. In turn, BfArM will sell these plants to the pharmacies. Like in Canada, a government controlled process.

Germany can learn from Canada in issues of quality control as well. BfArM wants to overlook the cultivation and distribution process, because patients have to be able to count on a high quality product. Quality control includes specific laboratories, which check the type of insecticides or pesticides used or how much THC a plant contains.

There is much to learn from the Canadians, such as quality control, and cultivation and distribution processes
How do you see this niche developing from a legal but also from a medical perspective? What do you personally hope to see happen?

Our clients hope to see a greater liberalization, also for casual use. In my opinion this is not going to happen neither in Germany, nor in other countries in Europe. Nevertheless, more countries in the world are considering the medical use of cannabis and consequently, investors are looking into it as they expect a significant growth in the market.

We will also see a certain amount of effort put into research. With this new kind of liberalisation the indications that qualify for cannabinoid treatment have to be defined. Today we know that cannabis can help patients with for example chronic pain, cancer or multiple sclerosis, but in future we may discover more indications that will qualify for the treatment with cannabis.

“Germany has one of the strictest narcotic drugs laws in Europe”
Accordingly, the group of patients who can use cannabis as a medicinal product will grow. But the market in Germany is very competitive, so it will be interesting to see how companies and institutions will position themselves on the market to get a piece of the cake that is bound to become larger and larger every year.

Personally, I am glad that cannabis has been made available as a medicinal product for people who suffer severe pain. For many it is the best painkiller with less side effects than other drugs.

Want to learn more about the legal aspects of cannabis as a medicinal product? Visit Dentons here!

Images via Miss Nuchwara Tongrit, Africa Studio, Shutterstockphoto3, Zerbor/Shutterstock

What you need to Know about the Legalization of Cannabis for Medical Use