Analysis: Germany’s medical cannabis market loses momentum but on pace to surpass 100 million euros

Insurance reimbursements for medical cannabis in Germany reached a new high during the July-September period, according to recently published data by the German National Association of Statutory Health Insurance Funds (GKV-Spitzenverband).

However, the data also suggests that growth in medical marijuana sales is losing momentum as double-digit gains in MMJ reimbursements become harder to maintain.

Statutory health insurance reimbursements for medical marijuana reached 32.3 million euros ($36 million) in the third quarter of 2019, up 9% over the previous quarter, when 29.5 million euros worth of medical cannabis was reimbursed.

Insurance-covered cannabis in the third quarter of 2019 was roughly 62% higher than the same period in 2018.

A previous Marijuana Business Daily analysis for the second quarter of 2019 reported quarter-over-quarter and year-over-year growth of 20% and 74%, respectively.

The figures for the January-September period show that when the curtain closes on 2019, total reimbursements of all categories of medical cannabis products could easily surpass 100 million euros and likely will end up at roughly 120 million.

This data does not include private prescription sales, which are paid out of pocket by patients.

July was the top month for medical coverage for cannabis since the current regulatory framework was implemented in early 2017, with total reimbursements reaching almost 11.5 million euros.

In August and September, reimbursements stayed between 10 million and 11 million euros per month.

All reimbursement data is based on the retail price at pharmacies, which are the only authorized points of sale to patients in Germany.

For products not included in the “finished pharmaceutical products,” pharmacies mark up prices as much as 100%.

Product mix

Germany continues to be the largest importer of medical cannabis in the world, and domestic production is not expected to reach the shelves until the end of 2020 the earliest.

Through the end of September 2019, all flower and full-spectrum extracts reimbursed had been imported either from the Netherlands or Canada.

Flower – which includes “unprocessed flower” and “flower used in preparations” – accounts for more than half the total medical cannabis market.

Flower represented 52% of total cannabis reimbursements during the third quarter of 2019, down from 55% the previous quarter.

Sales of full-spectrum extracts grew but remained at only 3% of the reimbursed market, about the same as the previous quarter.

Sales of dronabinol preparations, a category represented mostly by C3 – a subsidiary of Canopy Growth – increased from the previous quarter and now stand at 29% of the market.

Finished pharmaceutical products, a category represented mostly by Sativex, also increased slightly from the previous quarter, reaching 16% of the market.

The latest

Imports from the Netherlands are produced only by Bedrocan at this time and exported by the Dutch Office of Medical Cannabis.

The only companies that exported from Canada to Germany in the reported quarter were Aurora Cannabis, Canopy Growth, Cronos Group, Tilray and Wayland Group.

Of these, Aurora and Canopy rely on their German subsidiaries to import and distribute their products, while the other Canadian companies rely on local German partners.

Aurora products became unavailable last month in Germany, as first reported by MJBizDaily.

The company recently acknowledged irradiating its products. Placing medicinal products on the market that underwent ionizing irradiation without a special permit is an infringement of the German Medicines Law.

Tilray completed its first export from Portugal in September, shipping 500 kilograms (1,102 pounds) of flower to Cologne-based Cannamedical.

But that flower – which is being sold under the Cannamedical label – did not reach pharmacy shelves until mid-December, David Henn, CEO of Cannamedical, confirmed to MJBizDaily.

TerrAscend is expected to be the next Canadian producer whose products will be sold in Germany, as it was the latest to achieve European Union-Good Manufacturing Practice certification.

TerrAscend CEO Michael Nashat told MJBizDaily the company is “shipping out soon.”

Australia is likely to become the fourth country to supply Germany.

The German market also underpins the business plans of medical cannabis companies in Denmark, Israel and Colombia, though it remains to be seen whether they will be successful.

Most of the reimbursements in Germany are of prescriptions used to treat pain.

Alfredo Pascual can be reached at