FinancialBuzz.com reports cannabis based-drug approval
The U.S. Food and Drug Administration approved the first-ever cannabis-based drug, Epidiolex, last year to treat childhood epilepsy. Moreover, clusters of other countries have also realized the benefits of cannabis and have since moved to adopt medicinal legislation of their own.
The high investments for medication
The rapid growth of the industry has even led a handful of companies to list on the New York Stock Exchange and the Nasdaq Stock Exchange, the two largest exchanges in the world. After a string of companies listed on these two major New York exchanges, investment firms began to take note of the cannabis market’s potential. Now, investment banks such as Piper Jaffray, RBC Capitals, and Cowen have all backed the industry by covering publicly traded cannabis-based companies. Overall, the growth within the industry, as well as investments from other public and private sectors, has been appealing to analysts. Especially as investments from industries such as the tobacco and beverage sectors further highlight that, the cannabis marketplace is expected to become a thriving industry.
Previously, cannabis was seen as a taboo drug because of its psychoactive nature. However, many countries around the world are now beginning to acknowledge the medical benefits associated with the plant.
The smoking story of the demand
Canada reaching marijuana oversupply by 2021 as the country has recently had problems meeting the immense demand for cannabis after legalizing the plant entirely last year. Bill Blair, Canada’s Minister in charge of marijuana, noted some provinces have work to do in order to establish their wholesale and retail distribution systems.
On the other hand, the U.S.’s on-going legalization efforts have had a different approach to the recreational market. Oregonand Colorado were the first states to legalize recreational.
According to data compiled by Mordor Intelligence, the global cannabis market was valued at USD 7.7 Billion in 2016 and is expected to reach USD 65 Billion by 2023. Additionally, the market is expected to grow at a robust CAGR of 37% throughout the forecast period from 2019 to 2024.
The current state of the U.S. market has also led a series of Canadian companies to enter into the U.S. market space. However, their strategies rely heavily on the U.S.’s decision on whether or not to legalize cannabis on a federal level.