Canada's medical cannabis system can't keep up with demand

An increase in demand without an increase in production capacity, mixed with production issues and recalls, has lead to a shortage of legal medical cannabis

The availability of dried cannabis and cannabis oil in many of Health Canada’s licensed producers has decreased dramatically in the past few weeks and even months. Increasingly, some patients are reporting a decrease in the availability of their preferred products.

A mixture of factors are contributing to the shortfall, say several industry participants — namely a dramatic increase in new people registering to access medical cannabis, combined with a lack of new approved production space to satisfy it. Production issues and recent product recalls that have forced some producers to remove product from the market also impact availability.

Based on a scan by Lift on Jan 3, of the 21 producers currently licensed for sale, only one, Mettrum,  had no dried buds for sale, though they had two varieties of cannabis oil. Four of 21 producers don’t currently carry any CBD options for dried buds, either in high CBD or a 1:1 ratio with THC. In addition to these current figures, some patients are seeing products selling out quickly from their licensed producers’ online shops.

However the snapshots also show some producers with the same amount of cannabis, or more, than they had a few months ago, showing the problem is perhaps not widespread. While some producers are maintaining a consistent supply and some are increasing product options, the issue has been prominent enough to prompt at least two clinics that specialize in medical cannabis access to work on helping patients find solutions.

Product availability over past 4 months based on monthly snapshots

Lift spoke with several patients about the issue, many who were expressing their frustration on social media. Most have asked to not be named on record. A common theme among patients was the anxiety of not knowing if the strains they need will be available when they need them.

One patient who only gave his first name and age, Paul, 42, registered with Tweed. He says the issue of changing availability has been ongoing for some time.

“I have been registered with Tweed since March 2015. At first they had a tremendous amount of product. Within 6 months everything disappeared. We were told more would come and it never did. When it eventually came, it would disappear within a day. I feel like the system has let patients down.”

Paul says he hopes to begin growing his own to avoid these issues as soon as he can get authorization.

“Due to system shortcomings and no end to this problem in sight, I am going the route of self growing this year once i can find a physician that understands the situation.”

“We’ve got a lot of patients complaining about the inconsistency, first of the product. For instance, they’re going to order something that will come out that morning... it will be gone by the end of the day.” -Terry Roycroft, MCRCI

Jordan Sinclair, a spokesperson for Tweed, said the producer is increasing expansion of both their Ontario facilities and expects to address any product shortfalls very soon.

“We hear the feedback from some of our customers who would like to see more variety in the shop and we're expanding our operations in order to meet those expectations,” says Sinclair.

“A ten-fold expansion at Tweed Farms has already been harvested, some of this harvest has already been added to the shop and other strains will be added soon, as early as this week. We're also doubling the number of rooms in Smiths Falls and expanding our extraction capabilities to get ahead of the demand curve.”

Tweed Farms is a 350,000 sq ft greenhouse facility in Niagara-on-the-Lake, with another 25,000 sq ft of processing and storage space. This is currently the largest, fully-approved facility in Canada in terms of sq ft of approved production and sales space. They have another ~160,000 sq ft of approved production space at their Smiths Falls facility in the former Hershey Factory.

“You can predict how much you can produce in your facility with some degree of accuracy, and use the statistical history to gauge how many clients you’re able to take. That’s how we gauged to stop taking on new patients. It’s just based on how much we can produce and how much the average person consumes. Of course we’d like to supply more, but there’s a limitation of how long it takes to scale up.” -John Moeller, Broken Coast

Another patient who also asked that only her first name and age be used said that she had been registered with Mettrum until recently and had a similar experience.

“When I first registered with Mettrum, the clinic I went through encouraged me to sign up with them, and not knowing much about the cannabis program, I just took their advice,” says Anne, a marketing professional in Toronto in her early 30’s. She’s now turned to dispensaries to find cannabis to treat issues with chronic pain and insomnia.

“At first I was able to usually find the product I wanted, but very quickly I began to notice the strain I liked the most, Mettrum Red No 1 (Tahoe OG), was often not for sale. After months of this I gave up even trying, and when my prescription ended I didn’t sign up again. Now I go to a few dispensaries in Toronto. They don’t always have what I need, either, but they have far more options for me to choose from to find something else that might work.”

As of last week, Mettrum was unavailable for comment. Mettrum LTD owns 3 separate facilities, including the Agripharm brand, with a total of about 100,000 sq ft of approved production space. Canopy Growth, the parent company of Tweed Inc., has recently entered into an agreement to acquire Mettrum.

Hard to shop around

Because Health Canada rules dictate that a person can only register with one licensed producer based on one signed document from a medical professional, patients are unable to shop around effectively if their producer is out or low on product.

While you can register for additional producers with a new medical document for each one, not all doctors are willing to sign multiple documents, and some private clinics will charge an additional fee for each new registration to cover their own operating costs.

“As of August, when we got the ability for people to grow product, [new registrations have] probably jumped up to ten or eleven thousand per month signing up to these LPs, which is far faster than they anticipated and all of a sudden they’re running short on product.” - Terry Roycroft, MCRCI

One medical cannabis clinic in Ontario that specializes in medical cannabis access, Simcoe Holistic Health, recently sent out an email to their clients addressing the product shortages. In the email, the clinic notes they can assist patients in registering with a new producer in addition to their current one, or moving on from their current producer and choosing new ones.

The email also noted that this is an expected short term issue and that an increase in supply is expected soon:

“We have fielded many phone calls and emails from patients inquiring about the status with different licensed producers.  While we do not know more than we have shared, we have been told that new crops at many producers are expected to come online in the first few months of 2017. The sheer growth of the program and number of patients accessing the program have exceeded the expectations of many.”

Terry Roycroft, the President of the Medical Cannabis Centre Inc. (MCRCI), a private clinic in Vancouver that specializes in helping patients navigate Canada’s medical cannabis system, says his clinic is also hearing from many patients who are frustrated by a lack of availability.

Roycroft says some producers who, when patients initially signed up, had a dozen or more options of dried buds and even oils, are now often down to just a handful of options.

“We’ve seen that and there’s a lot of reasons why that’s happened. First and foremost is some of them have seen a lack of production. We’ve seen several LPs where they used to have 20 strains and products are down to three and five now.”

Roycroft says it’s not just what’s in stock, but the consistency of what is available. Some producers may introduce a strain for sale but in such limited supply that it quickly sells out. Many patients come to rely on a specific strain or THC/CBD level and different products available from their producer may not satisfy their own needs.

“We’ve got a lot of patients complaining about the inconsistency, first of the product. For instance, they’re going to order something that will come out that morning... it will be gone by the end of the day.”

Over 100,000 registrations

The other factor is the amount of people who are actually signing up for the system. Roycroft also says it’s the massive increase in people wanting to access medical cannabis that has caught the system off guard more recently. Whereas new registrations in the MMPR in early 2015 were around 1,000 or 1,500 a month, newer figures coming out of Health Canada more recently are showing well over 5,000 or more new registrations per month.

Based on recent figures, there are now well over 100,000 registrations under the ACMPR. The program has seen constant month-to-month growth since its introduction, with patient registration increasing exponentially.

The ability for more producers to now sell oil is also noted by many as a reason for an increase in patient registration. Physicians are reportedly far more comfortable working with the standardized, titrated dosages available via cannabis oils sold under the ACMPR, making them more likely to allow their patients to access these products.

Roycroft says he has also seen this increase even more through MCRCI since the government introduced new rules in August that allow registered patients to grow their own cannabis.

“As of August, when we got the ability for people to grow product, [new registrations have] probably jumped up to ten or eleven thousand per month signing up to these LPs, which is far faster than they anticipated and all of a sudden they’re running short on product.”

Despite this, Roycroft also says he believes the issue will be short lived and that in discussing the issue with different producers, he sees production increases reflecting the uptick in patient demand.

“Virtually every one of the LPs we talk to is on target to increase their growing amounts.”

New production space

One of those producers trying to increase their capacity to take on more patients is Broken Coast Cannabis. Located in Duncan, BC, on Vancouver Island, Broken Coast was licensed to produce in early 2014 and has been selling for over two years now, but in early 2015 put a cap on new registrations because of a lack of new production space to satisfy new demand.

Broken Coast currently operates inside about 12,000 sq ft, and began construction in 2016 on an expansion that will give them another 13,000 sq ft of production space, including grow rooms, drying rooms, mother rooms, and more. The expansion will allow them to potentially double their patient capacity over time.

Broken Coast’s General Manager, John Moeller, says they made a decision early on to stop taking on new patients to ensure they could provide for those already registered.

“You can predict how much you can produce in your facility with some degree of accuracy, and use the statistical history to gauge how many clients you’re able to take. That’s how we gauged to stop taking on new patients. It’s just based on how much we can produce and how much the average person consumes. Of course we’d like to supply more, but there’s a limitation of how long it takes to scale up.”

While new producers will help address the issue long term, say Moeller, one way Health Canada can better address it now is to issue sales licenses to those already licensed to produce and increase production licenses for those already selling to patients. There are currently eight producers still awaiting a sale license to the public.

Super Lemon Haze clones inside Broken Coasts Duncan, BC facility

“The quickest way to get production online would be to approve the sale license for a bunch of the producers they’ve already got. Approving a new producer means they are approved for production only. It’s probably another year before they’re going to be selling product, so it doesn’t solve any of the short term problems to approve new producers. Additional capacity for existing producers and approving sales licenses for production-only producers is going to be the quickest route to solve the supply shortage at the moment.”

As for their own expansion, Moeller says Health Canada’s response has actually been rapid. They had an inspection on the new space in the past few weeks and he says they expect approval to grow in the new rooms very soon.

Even if there is an end to product shortages in sight, for patients who rely on accessing cannabis through the legal system, these shortfalls show a serious issue with how well the current access program functions. They also highlight why dispensaries, both online and brick-and-mortar, continue to be in such high demand. As long as patients who take the time to access the legal system still can’t find the products they need consistently the stop-gap offered by the ‘grey market’ will continue to serve a purpose.

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6 comments

  1. Scott S Reply

    Let's not kid ourselves... of course all the LPs are talking increased growth and expansion but the motives are due to the upcoming legal market. It will be interesting to see who abandons the medical for the rec. market and what safe guards are in place for the medical customer. They wouldn't be the leading positions they are in for the rec. market without medical consumers. To me it feels like the med customers are a trial and error test market. They have control over how many applications they are taking to ensure a level of supply for their current customers. If they can't manage supply for a controlled number of users what protection do medical users have when the flood gates open up to the general public? What other supplier of medicine runs out and then offers up products that don't work? They should have order histories and know what to supply current customers rather that experiment or replace current offerings. Why change what's working/worked for your medical customers? Looming legalization? At the moment they have one set of customers, medical. LPs please treat your products as medicine and not a money maker for your next fiscal year.

    1. Celine Reply

      @Scott S
      Very well worded, and agree with everything you wrote! I'm very frustrated, especially the part about LP's registering too many customers, and it's all about $$ not about their patients. I need to go to dispensaries a lot!

    2. CrashT Reply

      I Totally agree Scott. I feel the same way, and I think you are right in my opinion.
      It hurts.

      Good luck to you.
      Hopefully you can grow your own. Try if you can and you will save tons of money.

      CrashT

  2. Maxcatski Reply

    Well, I knew all along that there were going to be product shortages! Health Canada is too slow bringing on capacity. The number of medical users is increasing exponentially with no end in sight. And the demand from the recreational market will far outstrip the medical. It takes months to simply grow the pot. Kudos to Broken Coast for limiting their clients - but I bet they have run out of preferred strains at times, too. I think demand will be chasing capacity for another two years at least. It may be time to grow your own - or find someone who can grow for you! Sorry, I am full up already. Peace, Maxcatski

  3. Byron Miller Reply

    This supply shortage has left many who rely on the products in a bind. Many will turn back to the Opiate drugs that they have quit using for pain. If the supply is not going to be reliable from the LPs, many will turn to unlicensed producers. For those relying on Cannabis Oil for pain relief and don't want to smoke pot, there is no alternative except to return to the opiate drugs they had quit using for pain relief. An unreliable Legal product supply will soon lead to more illegal operations starting up. With Canopy taking control of many LPs, they will have a monopoly and control the price using the supply and demand curve. When the government and pharmacies take control. the products will become too expensive for many in chronic pain. Companies like Canopy will obtain government contracts and patents to supply medical marijuana. Past history is a good predictor ie: the tobacco industry, alcohol, just a couple of examples where the government and mega producers took control. This leaves me wondering how the poor people who are suffering with Chronic Pain and other ailments that have found relief with Medical Marijuana products will be able to afford the products if it is not covered by medical plans and Pharmacare programs.