Conor O’Brien, Analyst, Prohibition Partner
October 15, 2021
The number of medical cannabis sales in the Netherlands fell in the first half of 2021 and continued a downward trend that began in 2018 when insurance reimbursements in the country ceased. The number of medical cannabis patients has also declined since then. However, the increasing total value of sales and volumes sold to pharmacies from 2019 to 2020 suggest that individual patients may be using more medicinal cannabis each year.
In the Netherlands, fewer patients are prescribed medical cannabis
The data recently published by the Dutch Foundation for Pharmaceutical Statistics (SFK) for the first half of 2021 show two important trends in the medical cannabis market in the Netherlands: sales are falling and the popularity of cannabis flowers, as opposed to oil, is increasing. The Netherlands is the third largest medical cannabis market in Europe after Germany and Italy, so trends in this country are important to understanding the industry across the continent. The number of medical cannabis dispenses in the Netherlands peaked in 2018, around the time the National Health Care Institute recommended prescribing medical cannabis due to a lack of evidence of its effectiveness. This had the double effect of stopping medical cannabis insurance reimbursements and discouraging doctors from prescribing medical cannabis treatment.
From 2019 to 2020, the total number of patients receiving medical cannabis declined from 11,000 to 9,000, consistent with a decrease in dispenses. A spokesman for the SFK told Prohibition Partners this week that “the number of first prescriptions has fallen more than the number of follow-up prescriptions,” meaning the decline was mainly due to a decline in new patients, not current patients receiving treatment abort . These patient numbers reflect a fraction of the total patient population in the Netherlands. In 2018, the Dutch government’s Lifestyle Monitor survey showed that only one in ten medical cannabis patients received cannabis on prescription, while the rest was obtained from coffee shops, street vendors and home-grown ones.
Source: SFK, Prohibition Partner
Another possible reason for the decline in patient numbers and sales could be the presence of 564 coffee shops in the Netherlands that offer non-medicinal cannabis at affordable prices, but under a legally gray state “tolerance policy”. Coffee shops also have the advantage of offering a wider range of cannabis strains and product formats than pharmacies, which are limited to just five strains made by the only domestic commercial breeder Bedrocan on behalf of the Dutch Medical Cannabis Agency (OMC), which also has an export monopoly. Medical cannabis oil can be made from these strains, but is available at only four pharmacies, with only one offering oils with a THC content of over 2%.
Medical cannabis price cut in September 2021
From September 2021, the government cut the price of cannabis, both domestically sold and exported abroad. Depending on the number of grams dispensed, patients now pay € 5.50 per gram of cannabis flower, plus VAT and prescription fees, when ordering 5 grams. Pharmacies have more control over the prices of oils. The OMC told Prohibition Partners that cannabis will now be exported at a price of € 5.30 per gram for a 5 gram order.
On behalf of the Dutch Agency for Medical Cannabis, Nicole Groot Bruinderink told Prohibition Partners: “Due to the positive (financial) results of the OMC in recent years, the OMC has been able to lower the price of medical cannabis.” A wide range of prices are paid for cannabis in competing coffee shops; the EMCDDA has set the average in coffee shops at € 4.40, but Marian Hutten and Serge de Bruijn of the PGMCG have stated that a lot of cannabis is sold in coffee shops between € 7 and € 20. Hutten has also pointed out that due to the high amounts of medical cannabis required by many patients, a small price cut would not convince many patients to get medical cannabis on prescription and that only a full refund would be provided for this and the availability of more Could support varieties.
Patients were left behind
Prohibition Partners spoke to Marian Hutten and Serge de Bruijn from the Dutch Patient Group Foundation (PGMCG) yesterday about these trends:
“The Netherlands has a backward system of regulating medical cannabis,” said Hutten. “If we look at Germany with a more recent system of medical cannabis regulation, there are around sixty varieties of medical cannabis available, while in the Netherlands we are stuck with five. These five don’t work for everyone, they certainly don’t work for me, and that unnecessarily restricts patients. In addition, based on the recommendation of the National Health Care Institute, patients are not offered reimbursement, so cannabis remains unaffordable for many. The result is that many patients are left to their own devices, either growing themselves or shopping in coffee shops and on the black market. The lack of legal protection for medical cannabis patients in the Netherlands makes it very difficult to be a patient here. Medicinal cannabis patients are losing their homes for growing their own cannabis or losing their driver’s license for using legal drugs, and that has to change. “
Change product formats
As can be seen in the graph above, the relative market share of medicinal cannabis flowers in contrast to extracts rose to 55% in the first half of 2021, from a low of 44% of sales in 2017. While the number of sales of flowers dominates, It should be noted that the market share is still heavily weighted on oils in terms of value, as these are priced higher in the pharmacy.
For comparison: the market share of flowers in contrast to extracts in the reimbursed cannabis sales in Germany is also around 55%, but is declining and was 75% in September 2019. The downward trend in the number of oil dispenses since the end of 2017 is likely due to the fact that the prices for oils are significantly higher than for the treatment with flowers and only one pharmacy offers THC-rich extract products.
Sales value increases
While the number of patients and dispensing is falling in the Netherlands, the volume and sales value have increased in recent years. The latest data provided by OMC to Prohibition Partners shows that the amount of medicinal cannabis sold to pharmacies for distribution to patients has increased after a decline in 2018
Source: Dutch Agency for Medical Cannabis, Prohibition Partner
In addition, according to SFK data, the value of medical cannabis sales increased from 4.7 million euros to 5.1 million euros from 2019 to 2020. Neither OMC nor SFK were able to provide data on sales value or weight from 2021. It is worth remembering that the market share of the more expensive oils is falling, so the increase in value is not due to rising medical cannabis costs.
Instead, it appears that the amounts of medical cannabis purchased by every medical cannabis patient increased from 2019 to 2020. Neither the OMC nor the SFK were able to explain to the prohibition partners why individual patients may be consuming more legally prescribed cannabis.
Delays in cannabis regulation
Several developments in the regulation of medical cannabis and adult cannabis have been delayed, not only by COVID-19, but also by the failure of the ruling parties to form a coalition; the Netherlands has been without a ruling government for over six months. The OMC had already planned to run a tender online for two medical cannabis breeders that would offer new strains to patients, but no progress has been reported for months and it is unclear when new breeders will come online.
Similarly, the process by which 10 municipalities would offer fully legalized cannabis for adult consumption is still online (see The European Cannabis Report: 6th Edition for more on this). PGMCG’s Hutten has pointed out that this program has stalled due to COVID-19 and the lack of an incumbent government.