Pot-stock investors, marijuana enthusiasts and medical cannabis producers like MGC Pharma (ASX:MXC) are buzzing in response to a World Health Organisation (WHO) announcement recommending the reclassification of cannabis under UN law.
This week, the WHO’s Expert Committee on Drug Dependence (ECDD) issued a formal submission to the UN Commission on Narcotic Drugs recommending that cannabis and its key chemical components be rescheduled under international law.
Historically cannabis has been classified as a Schedule IV substance under the UN’s 1961 Single Convention on Narcotic Drugs Treaty, the accord’s most restrictive tier for narcotics.
Sharing the Schedule IV title with drugs like heroin and fentanyl, the archaic 58-year-old ruling labeled cannabis and its extracts as “dangerous and without any therapeutic importance”.
The WHO’s new recommendations call for cannabis and cannabis resins to be deleted from Schedule IV classification and for cannabis extracts and tinctures be deleted from the Schedule I grouping entirely.
Additionally, the WHO has recommended Dronabinol and Tetrahydrocannabinol – two forms of THC – should be deleted from a 1971 Convention on Psychotropic Substances and added to the Schedule I category.
The Committee has also made a clarification that all products made with cannabidiol, which contain no more than 0.2 percent THC, should no longer to be considered under any UN narcotics rulings.
The WHO’s call for reclassification is the first review into the status of cannabis and its extracts made by the organisation since the treaty was first signed in 1961.
The review was spurred by pressure from the cannabis advocacy group Americans for Safe Access, who in March 2016 submitted a 91-page report to the WHO calling for a critical review into the medical benefits of the plant.
What does the ruling mean for the industry?
If adopted in full, the WHO recommendations would significantly help the progression of the medical cannabis industry.
The change will see a greater number of countries given autonomy when regulating CBD for medical use, leading to less red-tape and relaxed controls regarding cultivation, manufacturing and distribution.
It will also help drive greater market adoption and commercialisation for companies like MXC.
Speaking with Star Investing, Roby Zomer, Co-founder and Managing Director, MGC Pharmaceuticals commented that, “the World Health Organisation’s suggestion to reclassify cannabis and cannabis compounds is a monumental step in the right direction for us and the sector.
“Legislative changes go a long way in helping change views and perceptions of the industry and products and we are extremely excited to see the outcome of discussions.”
“We believe the adoption of the recommendations by the Commission on Narcotic Drugs would deliver significant upside to the Company and provides further validation of the Company’s seed-to-pharma strategy and the development of its pharmaceutical product pipeline.”
“Additionally, should revisions be applied to the rules surrounding pharmaceutical preparations; government authorisations will no longer be required for each import and export shipment, significantly reducing bureaucracy and considerably decreasing the distribution timeline from the completion of production to the arrival of MXC’s GMP certified medical cannabis products to patients.”
The news of the WHO’s recommendation has been received enthusiastically across the sector, with investors and producers alike hoping the regulatory shift will leave even greater room for the industry to flourish.
This content is produced by Star Investing in commercial partnership with MGC Pharmaceuticals. This content does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.
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