Global Cannabis: Lesotho

Lesotho

Spiral Aloe is the national plant of Lesotho, a South African nation that someday hopes to be a major international exporter of medical marijuana. Photo by Christian Offenberg

Milestones in the Medical Cannabis Program

A 2008 law allowed for some medical cannabis businesses, but legislation was updated last year to create regulatory certainty the industry needed to get off the ground. Another update is planned for this year.

 

Key Laws and Regulations

  • 2008 Drugs of Abuse Act
  • Drugs of Abuse (Cannabis) Regulations, 2018
  • Drugs of Abuse (Cannabis) Regulations, 2019 (not released yet)
  • Regulator: Lesotho Narcotics Bureau

 

Market Data

  • There are no local patients, and the regulations are mostly focused on businesses that want to cultivate and produce medical cannabis for the international market.
  • Sources say about five dozen licenses have been granted so far by the Lesotho Narcotics Bureau.

 

Medical Cannabis Products Available in the Market

  • No medical cannabis products are currently available in the market; however, the active regulations do not restrict what can be produced, nor do they limit the amount of THC products can contain.

 

North American Companies in the Market

As the first country in Africa to centrally regulate medical marijuana cultivation, Lesotho has been a magnet for international investments. A number of Canadian companies—and even some from the United States—are active in Lesotho, although not all partnerships have worked out.

For example:

  • Ontario-based Aphria has an offtake agreement with Verve Dynamics, a licensed producer.
  • Ontario-based Canopy Growth works through its local subsidiary, Daddy Cann Lesotho.
  • Another Ontario company, White Sheep, broke ground this year on its cannabis facility in Lesotho.
  • Toronto-based Supreme Cannabis invested $7.7 million (CA$10 million) for a 10% stake in Medigrow Lesotho.
  • Seattle-based Rhizo Sciences, meanwhile, discontinued its ties with local player Medi Kingdom.

 

Big Picture

  • The 2008 Drugs of Abuse Act set the stage for the MMJ industry in Lesotho, but that law left too many legal and regulatory loopholes to make it workable for businesses. The follow-up law in 2018 filled in most of the gaps and subsequently opened the door for investments worth tens of millions of dollars.
  • Any company or entrepreneur looking to get involved in this market ought to heed this assessment from one U.S. business that ultimately retreated from Lesotho: “Companies planning to operate in emerging markets such as Lesotho or other African countries face additional challenges due to remote locations and lack of key infrastructure. The biggest challenge is lack of access to professional medical cannabis expertise capable of operating a legal, compliant business. As such, collaboration with capable strategic partners is essential for serious groups considering investment in this emerging international industry.”
  • Still, opportunities exist for companies with patience and those able to work within the strict regulatory scheme. Most of those opportunities will be related to export, at least according to the current rules.
  • Lesotho is working on new regulations to be implemented this year, according to a Marijuana Business Daily If the current proposal is approved unamended, it could effectively make entering the market more difficult.
  • The country will be an exporter of cannabis, but when that actually will happen is anyone’s guess. Lesotho also could be an important beachhead for medical cannabis businesses as other African nations open their markets.

Leave a Reply

Your email address will not be published. Required fields are marked *