South Africa grants first medical cannabis license

The discussion around medical cannabis in South Africa dates back to 2014 when the then Minister of Home Affairs, Mario Orianai-Ambrosini, declared the use of cannabis in the treatment of his cancer and introduced legislation to make it legal. His death had left the project in limbo, but in 2017, the Medicines Control Council (MCC) published guidelines for setting up a medical cannabis industry. In February 2018, the project was transferred from the MCC to the South African Health Products Regulatory Authority (SAHPRA), which has just granted the first license.

The first South African license

The company House of Hemp which obtained South Africa's first medical cannabis license and, by extension, its partner Afriplex whose laboratories have been chosen as reference by the Cannabis Research Institute of South Africa (CRI). «Afriplex is our strategic partner, House of Hemp, are extremely honored to be associated with SAHPRA's first cannabis license,» explains Danie Nel, CEO of Afriplex. Her company has already developed four (cannabis-free) pharmaceutical products for the local and international market, including Herbex, a popular weight-loss drug.

«Our teams have worked tirelessly over the past seven years to ensure that we comply not only with local standards but also with the legislative requirements and quality standards of international markets. Being the first in South Africa to receive this accreditation enables us to actively pursue our expansion plans in the local and international cannabis market,» explains Danie Nel.

Interviewed by local radio station Money Web, co-founder of House of Hemp, Dr. Thandeka Kunene, explains that the license allows them to cultivate cannabis and extract its active ingredients (THC and CBD) to make pharmaceutical products. The company has had to prove that its production facilities meet safety and efficiency standards, and have been inspected three times by the authorities. Production has not yet started, and the companies are building up their teams and seeking investment. According to Dr. Thandeka Kunene, offers for full or partial takeover have already been made, to the tune of 20 million euros.

The South African medical cannabis market

The granting of this first license marks the creation of a whole new industry, which Dr Thandeka Kunene estimates could create 500,000 jobs across the production chain within a year. The co-founder of House of Hemp believes that South Africa has the potential to become a world leader in the medical cannabis industry. It estimates that of the $50-60 billion medical cannabis market over the next decade, South Africa could occupy a share of 27%.

For the time being, there are no legislative provisions specifying how patients can access medical cannabis. What's more, since the rulings of the Constitutional Court of March 2017 and September 2018, patients are able to grow their own cannabis. Indeed, the Constitutional Court has ruled that the prohibition of self-cultivation for private use by adults, whether recreational or medical, is unconstitutional. Patients can therefore bypass the medical cannabis industry and indulge in home-grown production at a lower cost.

Nevertheless, beyond its local reach, the South African medical cannabis industry has a regional scope and international markets. House of Hemp and Afriplex do not intend to limit themselves to the domestic market: «As markets open up abroad, we will be able to export our products to any country that is legally authorized to buy them. (...) South Africa offers a secure and stable economic environment in sub-Saharan Africa, and represents an open door to the rest of Africa and the world».»