Both local and foreign businesses are eager to grow the medicinal cannabis business in Peru, though there are regulations still pending.
The law permitting the use of medicinal cannabis in Peru passed in 2017. And since then, both local and foreign businesses are laying the groundwork for what many believe will be a booming local business and agro export.
El Comercio’s Día 1 supplement laid out a report on the growing business ventures wanting to cultivate and sell cannabis for medicinal use in the country. According to Spectrum Therapeutics – one such business in Peru – there are 1.5 million Peruvians with medical conditions that can be treated with cannabis.
There is no shortage of interest from patients, doctors and business ventures. As proof, over 700 people attended the first international symposium on the topic in the country, presented by the Medical College of Peru in November 2017. The capacity limit was 450.
The agro-business consultancy group ACM Peru estimates that there are at least 50 companies, 40 of which are registered as local, that are interested in importing and commercializing the product, and a few that are also interested in cultivating. Seven of these foreign companies have registered 11 cannabis derived product patents, according to Indecopi.
Foreign companies in Peru
Canopy Growth Corporation, which operates as Spectrum Therapeutics in Latin America, is one of the companies that now operates in Peru. Though it already cultivates cannabis in Huila, Colombia in 126 hectares, and projects to export cannabis derived products throughout the region, it’s currently focusing on working with the medical community in Peru to raise awareness of the uses and benefits of medicinal cannabis. The company plans to create an education program in collaboration with the Universidad Peruana Cayetano Heredia.
Another Canadian company looking to start business operations in Peru is Tilray, which currently sells its products in Argentina and Chile. There’s also the Australian Zelda Therapeuthics. The company is in talks with local companies in Chile to export its products across the region.
Cannabis & Co is a Peruvian company that aims to open up cannabis-focused drug stores in the country. Not only will it sell the product but the founder wishes for the retail space focus on educating consumers. Greenspot Biomedical Perú SAC is a subsidiary of Canada’s Greenspot Biomedical Inc. The company’s plan is to cultivate up to 150 hectares of cannabis and are evaluating the regions of Ica, Lambayeque and Piura and are evaluating on to satisfy the local and regional market. The company is investing USD $35 million, with 20% of that going in to setting up the logistics of traceability from seed to final product.
Finally, the company Anden Naturals aims to cultivate cannabis in Ica and Huaral to satisfy local and regional demand. It will also set up an extraction facility with the goal of also creating drug stores. For now its focus is on importing and selling products from its holding company Anden Bio Naturals USA LLC.
While businesses will find many advantages to setting up shop in Peru (low fixed costs, cost of labor and direct flights to international hubs), there are hurdles to be resolved before the industry can grow.
Though the regulations for the law permitting medicinal cannabis were published in February of this year, the final provisions have yet to be presented and it’s been more than 96 days since the deadline in June.
The Ministry of Interior must outline protocols for safety, control and inspections to import the product. Additionally, the Ministry of Agriculture must define parameters ranging from obtaining the cannabis seeds to the maximum amount of land that is allowed for cultivation. As the law stands now, individual companies must perform their own quality control, which for the CEO of Anden Naturals can take away credibility from the whole industry. He instead would like to see independent laboratories set up that are able to validate quality.
The Health Ministry paid for and obtained 10 liters of CBD from Anden Naturals, which it plans to distribute through prescriptions from Digemid (the state’s Directorate General of Drug Supplies and Drugs) pharmacies.
According to Día 1, Peru could within the next three to five years cultivate enough cannabis to satisfy 5% of the global demand and become one of the country’s top exports.
Source: El Comercio
Cover photo: Andina