Pharma giant Bayer on cannabis: No decision ‘until we fully understand market’

Monsanto pulled its Health Canada-approved pesticide from the cannabis market months ahead of a planned merger with German company Bayer, but the pharmaceutical giant is not ruling out an eventual entry into the sector.

Health Canada told Marijuana Business Daily that Monsanto – the manufacturer of Actinovate SP – requested cannabis be removed from the pesticide’s label earlier this year, citing vague “business reasons.”

Accordingly, the agency removed the pesticide from its list of fewer than two dozen approved pesticides for use in commercially produced medical marijuana.

“Monsanto has no experience with this type of usage, on this type of crop, so we have removed (cannabis) usage from our product label,” said Trish Jordan, public and industry affairs director for Bayer Canada.

No decisions will be made on re-entering the cannabis sector “until we fully understand the market and the relevant regulatory environment,” she said.

Jordan noted the decision to change the label was not related to Bayer’s $62.5 billion acquisition of Monsanto.

Bayer began integrating St. Louis-based Monsanto into its operations in August after becoming its sole owner June 7.

Neither Bayer nor Monsanto have any other approved pesticides for use in cannabis cultivation in the Canadian market.

Big pharma and cannabis – the wait continues

Since Constellation Brands – one of the biggest alcohol businesses in North America – announced a record 5 billion Canadian dollar ($3.8 billion) investment in Canopy Growth last month, market watchers have said it is only a matter of time before pharma and tobacco companies make a splash in the cannabis industry.

Canada’s regulations to support the enactment of the Cannabis Act specifically contemplate this with an entry devoted to “drugs containing cannabis.”

“With new medical products to be made, and profits to be had, it’s only a matter of time until sophisticated Big Pharma feels the time is right to jump in,” said Matt Maurer of Toronto-based Torkin Manes’ cannabis law group. “How far down the road that might be is still difficult to predict.

“We see insurers increasingly starting to cover medical cannabis, in part as a means to decrease costs and have patients switch off more expensive drugs onto cannabis.”

When more large pharmaceutical companies invest in the cannabis industry, Maurer said, “I think you will see another spike in valuations similar to what we saw with Constellation. The introduction of established pharma companies into the industry gives the industry increased credibility in the eyes of the general public.”

Big Pharma’s access to the cannabis space has been discrete thus far, mostly involving patent registration.

Seven of Canada’s top 10 marijuana patent holders are multinational pharmaceutical companies, according to a joint research project between New Frontier Data, of Washington D.C., and Grow Biotech, a London-based cannabis bio-technology firm.

John Kagia, New Frontier Data’s chief knowledge officer, expects multinational medical cannabis companies to soon make a deeper push into patent and intellectual property protection.

“If you look at how young most of the cannabis LPs are, much of their explosive growth has happened largely in the past 18 months,” he said. “These are very young companies, who are still building out their infrastructure.

“It’s not surprising that they don’t feature heavily in patent ownership, partly because of how long it takes to get through the patent process and partly because of how long it takes to do the R&D to get an outcome.”

Top holders of marijuana patents in Canada (home nation in parentheses):

  • Ciba-Geigy AG (Switzerland): 21
  • Pfizer Products (U.S.): 14
  • GW Pharma (U.K.): 13
  • Telefonaktiebolaget LM Ericsson (Sweden): 13
  • Merck Sharp & Dohme (U.S.): 11
  • Solvay Pharmaceuticals (Netherlands): 7
  • Kao Corp. (Japan): 7
  • Ogeda SA (Belgium): 7
  • Sanofi-Aventis (France): 6
  • University of Connecticut (U.S.): 6

Matt Lamers can be reached at [email protected]

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