By Lethbridge Herald Opinon on July 23, 2020.
Could Canada build an economic niche in recreational drugs?
Legal cannabis, once a pipe dream, is now spitting in the face of the “war on drugs.” Turns out that the “Devil’s Lettuce” was not as destabilizing to society as some might have wanted us to believe, and in fact poses very fascinating business opportunities for Canadian enterprises.
The cannabis sector is still in its infancy in Canada and in several states in the U.S., but there is opportunity aplenty. Unlike like other sectors who develop a product and must maximize supply chains, retail space and marketing to build a customer base, the once-criminalized cannabis already held an enthused market. Innovation in developing more effective products, and methods of consumption had largely been completed by the black market. And unlike other sectors, cannabis does not naturally face reactionary policy restrictions over time. They were imposed from the beginning.
Despite these strange qualities that other products on the market do not usually possess, cannabis proves to be profitable. And Canada, in its early adoption of legalization, finds itself in an advantageous position as the many major trade partners are beginning to reconsider its position on criminalizing cannabis. If the cannabis sector and Canadian governments focus on lobbying efforts with these trade partners and aiding in developing policy for legalization, the Canadian cannabis sector could monopolize the global cannabis market with its existing and evolving business models.
But for opportunities beyond cannabis, their model of legalization must be analyzed, as there is industrial evidence that perhaps cannabis has acted as a “gateway drug” in more than the typical sense. Two Canadian companies, Champignon Brands and Cybin Corp, have been listing shares. The business these companies are in, as well as several European companies, is that of psychedelics. Like cannabis once was, most psychedelics are criminalized or at least heavily restricted. And also like the history of medicinal cannabis, there are a steady stream of studies revealing the potential health benefits of the therapeutic use of psychedelics. Beyond that, many figures in popular culture, such as podcaster Joe Rogan and journalist Michael Pollan, have promoted the use and further study of psychedelic drugs.
Champignon and Cybin both poise business models that look to take advantage of the growing interest in the therapeutic use of several psychedelic substances – many of which have displayed effectiveness in treating addiction and mental health issues. But a closer look at their plans reveal a comprehensive strategy to eventually bring to market psilocybin/mushrooms. This strategy appears to be preparing for a short period of “medicinal” status, while these companies wait for where the money is at – legalization of recreational use.
The announcements of these companies come around the news of a new item appearing on the 2020 November ballot in Oregon. When Oregonians go in to vote for their choice of president this autumn, there will be an item on the ballot titled “Oregon Psilocybe Initiative” and they will be allowed to select Yes or No. If voted in, this initiative would give the Oregon Health Authority two years to create rules and regulations for the therapeutic use of psilocybin, as well as give a market to Champignon and Cybin.
The future of psilocybin, as well as many other psychedelic substances, share similarities to the development of the cannabis sector. Criminalized, with an enthusiastic consumer base on the black market with plenty of innovation underway, and, if legalized, would be born into a tangled web of rules and regulations. If the psychedelic movement persists, and Oregon winds up serving as an example, it would be in Canada’s interest not only to follow suit, but to apply the growing pains the cannabis sector experienced in order to profit off of the shifting attitudes about these materials around the world. To put into scope the potential profit, reports have come out that valued the global psychedelic trade to be over $6 billion USD – and that is with the product not being legal in most places.
As a dwindling middle power, recreational drugs may hold a share of the economic future of Canada. Cannabis has given our industry a leg up in experience over others as they begin to open up to legalization. With two Canadian companies already preparing for it and potential for a legal market south of the border, the trickle might soon become a flow.
Connor Livingstone is a political science graduate from the University of Lethbridge and currently works in social services.