Medicinal cannabis in Germany - Business Report

6 Confidential __________________________________________________________________________________ EXECUTIVE SUMMARY The Cannabis market resembles in many ways the dot.com bubble at the turn of the millen- nium. Many new companies and even more potential financiers are seeking their quick fortune in this market. The underlying business models vary between the attributes "highly reputable" to "predominantly speculative". Nevertheless, the market for medical Cannabis in Germany has been growing since March 2017 - after the entry into force of the "Cannabis Law" with impressive speed. However, the market for medical Cannabis is different from "classic" pharmaceutical markets in many respects. There is not one homogeneous product class, but a broad portfolio of Cannabis products, starting with finished products containing only one defined active substance (Canna- binoid) at the molecular level, standardized Cannabis extracts and prescription substances up to Cannabis flowers with very different mixtures and contents of active substances. Each of these market segments in the medical Cannabis market follows different rules and market mechanisms. The market participants in this growing market are also very heterogeneous, as are the prod- ucts represented in the market. On the one hand, multinational companies, today still mainly from Canada and Israel, are involved, offering vertical integration from Cannabis production to market- ing. On the other hand, we see large number of suppliers who specialise in only one building block in the value chain of Cannabis marketing, such as producers, importers, marketing and distribu- tion companies or service providers for the Cannabis market. The players, physicians, pharmacists and patients directly stimulating the Cannabis market are also interested in the further growth of the market, as interesting and in some cases promising new therapeutic options are now available for a number of previously difficult-to-treat diseases. The cost bearers in SHI and private health insurance, but also many stakeholders at the level of the regulatory institutions, have a different interest and do not want to allow an unbridled expo- nential growth of the Cannabis market in Germany and at the same time enforce the principles of evidence-based medicine in the evaluation and clinical use of medical Cannabis. EPC HealthCare GmbH in Hamburg, in close cooperation with the leading data service provider for the pharmaceutical industry in Germany, INSIGHT Health GmbH & Co KG fromWaldems-Esch, has created the first business report - the market for medical Cannabis in Germany. This business report spans a wide range of topics in order to examine the market for medical Cannabis fromdecisive perspectives. Quantitative market data are related to qualitative data from a 360° market research among doctors, pharmacists, patients as well as the cost bearers in the SHI and private health insurance. The relevant legal bases and corresponding regulations are ex- plained. The market is presented by segment (finished products with APIs, Cannabis extracts, Can- nabis formulations and Cannabis flowers) from a national and regional perspective. The indica- tions for the use of medical Cannabis are questioned according to the underlying evidence and the market potential is illustrated based on the prevalence requiring treatment. Along with the approval status of Cannabis products, i.e. from narcotic to prescription-only drug to pharmacy-only OTC product and finally no longer pharmacy-only self-medication, the require- ments for market access and other relevant parameters are explained. Subsequently, special mar-