Canadian Pharmacy Chain Expands Cannabis Distribution Agreements
Shoppers Drug Mart, a major Canadian pharmacy chain, signed its third distribution contract with a cannabis company at the end of last week. This move comes as the company anticipates that, with the legalization of cannabis, regional governments will choose to distribute medical cannabis through pharmacies.
The latest agreement is with Tilray Canada Ltd., one of the largest commercial cannabis producers in Canada and an official participant in the federal mail-order system for medical cannabis distribution.
Shoppers Drug Mart’s Strategy and Expectations
A representative from Loblaw Companies Ltd., which owns the Shoppers Drug Mart brand, told the press that the company has been interested in retail cannabis distribution since 2016 and has been waiting for a license from the Canadian government for two years.
Currently, Canadian law only allows legal therapeutic cannabis to be distributed remotely, via mail or courier. This system has been in place since reforms in 2014, when the Stephen Harper administration banned retail sales of cannabis. The current Trudeau administration will allow regional authorities to choose their preferred distribution model, which could include selling cannabis flower and extracts through licensed pharmacies.
While the upcoming reform mainly concerns the right to use and distribute recreational cannabis, Shoppers Drug Mart management believes that authorities will also liberalize access to therapeutic cannabis.
“We are confident that after reforms to the recreational market, federal and regional authorities will also move to reform the medical cannabis market, allowing private companies to sell it under the supervision of regulators and healthcare professionals,” said Kevin Groh, a spokesperson for Loblaw’s PR department, in a press release.
Online Sales and Future Plans
The company is also working on launching an online store for medical cannabis sales and plans to open cannabis sections in pharmacies if regional reforms permit.
Expert Opinions and Industry Trends
Analysts like Vahan Ayman from Beacon Securities believe that many Canadian provinces will prefer to entrust the distribution of psychoactive products to companies already experienced with regulated pharmaceuticals, rather than newcomers who still need certification.
“It’s also important to note that these companies are actively lobbying for such reforms at both the national and federal levels,” Mr. Ayman added.
In addition to Tilray, Shoppers Drug Mart has also signed contracts with Aphria Inc. and MedReleaf.
Regional and National Support
Interest in distributing cannabis through pharmacies is especially high in Quebec, where two organizations representing private pharmaceutical distributors are lobbying the local government to adopt this model. At the federal level, the Canadian Pharmacists Association actively supports the idea.
Public organizations, such as “Canadians for Fair Access to Medical Marijuana,” also back the plan to distribute cannabis through pharmacies. “Besides many officials and commercial representatives, this model is supported by most pharmacists and consumers,” said Jonathan Zaid, head of the organization.
Consumer groups believe that selling cannabis in pharmacies will give patients access to insurance coverage for pharmacy services and help reduce the stigma still associated with purchasing cannabis.
Government Consultations and Alternative Models
Canadian health officials note that such reforms will largely depend on regional authorities, who must decide whether to adopt this model. Since the beginning of the year, the Ministry of Health has been consulting with the professional pharmacists’ association about the nuances of distributing cannabis through pharmacies. The association has recommended that cannabis be sold in separate sections of retail pharmacies, away from minors.
Besides the pharmacy distribution model, the ministry and regional authorities are also considering the possibility of opening fully private retail cannabis stores.
Other Pharmacy Chains and Market Outlook
Other pharmacy chains are also exploring entry into the cannabis market. Maricann Group Inc. has signed a contract with Lovell Drugs Limited, while CanniMed Therapeutics has partnered with PharmaChoice. Many experts expect that growing public interest could lead to shortages in the early stages of the open cannabis market.
Jean Coutu is currently the only major pharmacy chain in Canada that has refused to distribute cannabis.