The German medical cannabis market, which has developed since 2017 when the law was formally changed to include public health insurance covering medical cannabis, is a very different animal than any other that has come before. Based on the fact that on the medical side, those who grow, sell and sell the plants and medicinal products obtained from them must be certified at a high, formal, federal level before they can become part of the pharmaceutical supply chain.
While a lot of attention has been paid to who might grow cannabis in Germany, most people, certainly outside the industry, if not the country, know very little about any of the other critical components for all of this – namely the regulated, GMP-licensed, Cannabis specialist dealer.
GMP stands for Good Manufacturing Practice – and is a global standard for production and for the additional hops along the supply chain. The conditions and procedures for qualifying all processes, including drying, processing, extracting and dispensing, may sound new in Cannabiz, but are routinely used in the broader pharmaceutical industry. These standards must also be followed for cannabis produced and sold for medical consumption throughout Europe.
The German standards for EU-GMP are also considered to be the toughest in Europe.
What makes the achievements of all German companies in this area even more remarkable is that they are all start-ups. All of them have also gotten their way through funding, weird, and changing regulations, and have met the standards of BfArM, the German federal version of the American FDA that arbitrates and issues licenses to operate.
However, they have and will already play an outsized, if not critical, role in the entire medical cannabis discussion. Starting with the fact that you cannot get your cannabis in the country for legitimate medical sales unless you partner with them or companies like them.
There is no abbreviation for a manufacturer here, for example to sell directly to a pharmacy.
As of 2021, the BfArM has actually issued innumerable licenses (rumor has it that they reached 80 in the past year, at an average cost of 1 million euros each for proper setup). Beyond the mixing of paper, however, there are companies that are now in operation and have full logistics and distribution that meet the high standards of the medical market in Europe.
Here’s a quick look at three of them.
Cannamedical Pharma, Cologne
Founded in 2016 by David Henn, Cannamedical recently partnered with Semdor Pharma Group and PS Pharma, a logistics and warehouse company, to expand its reach, expertise and presence. The company, which already has an impressive presence, is ready to compete with the “big boys” – namely, the public Canadian companies like Aurora Cannabis, Canopy Growth and Tilray / Aphria in a much more competitive distribution landscape. The company is based in the largest federal state (North Rhine-Westphalia) and currently employs 160 people with an annual turnover of over 65 million euros.
As such, the company has evolved with the market in a way that few others who go online now can compare, partly due to its early market entry and subsequent positioning. The company sources its own products from several countries including Canada, Portugal and Australia.
With a VC donation of 70 million euros, it is currently one of the best funded cannabis companies in Europe.
Cansativa was founded in 2017 by a German heart surgeon and two of his four sons – both with significant German business experience (lawyer and management consultant). When asked about the inspiration for the family that has driven the successful start-up so far, Benedikt Sons replied: “My father has the idea that you should treat people with things that really help. He puts the patient first. That drew his attention to medical cannabis. While there was no “evidence” of the scientific kind, he saw that it clearly helped the patients. “
The company has just received the exclusive contract from BfArM, the German equivalent of the FDA and the federal agency responsible for the regulation and licensing of cannabis, for the distribution of all cannabis grown in Germany across the country. This meant that the company had to create a pharmaceutical grade distribution and logistics service from the ground up, which it did successfully. “We can follow every track at every step. We sell overnight throughout Germany. A pharmacy can order medical cannabis until late every day, but it will be delivered the next day, ”says Sons, obviously proud of this achievement.
The company has also amalgamated some of Canada’s larger publicly traded companies to be “Germany’s leading multi-brand importer,” according to Sons.
With a secure 1,000 square meter warehouse licensed and approved for narcotics, they operate a state-of-the-art import and distribution center with two EU GMP and EU BIP certified facilities.
Drapalin Pharmaceuticals, Munich
Drapalin was founded by three childhood friends from Ukraine and is one of the few companies in the business that has a female manager (Lana Korneva). Together with the Garev brothers, she founded the company in 2018.
Since then, Drapalin has started to create a niche for itself in the Bavarian state market. FC Bayern, as it is pronounced in German, is generally known as the “most conservative” German state for several reasons, starting with its religious and costumed annual Oktoberfest celebration. In addition to brewing beer, the southern German state also has the distinction of having one of the most legal cannabis patients in the country – but also some of the strictest laws in the books to prosecute “illegal” consumption.
So it should come as no surprise that Bavaria also has some of the most restrictive rules for dealing with narcotics. Setting up a highly regulated start-up in this environment is like no other industry, including early-stage fintech companies. There are huge and immediate penalties for going wrong. You can’t just “misplace” a few grams.
The company has also been one of the most innovative companies in finding new sources for GMP quality flowers and is starting to import medical cannabis from three continents into Germany.