Law Times

Law Times • March 30, 2015 Page 21 www.lawtimesnews.com Medical marijuana continues to be source of litigation Change to new regulatory regime among issues sparking legal challenges By shannon Kari Law Times here has been one constant since the Ontario Court of Appeal struck down the prohibition against posses- sion of marijuana for medi- cal reasons in 2000: the subsequent rules imposed by the federal government have been subject to repeated court challenges. The courts have found the regula- tions that govern medical marijuana to be invalid on more than one occasion and there are two current proceedings before the courts that could again require the federal government to go back to the drawing board. A Federal Court judge in British Co- lumbia is presiding over an ongoing chal- lenge to regulations that require those authorized to possess medical marijuana to buy from approved producers in the private sector. Late last month, the Su- preme Court of Canada reserved its deci- sion in an appeal from British Columbia on whether the rules permit only canna- bis in dried form for medical marijuana patients. The result is ongoing uncertainty in an area where the government has rarely addressed the complaints of the medical marijuana community without a court challenge. At the same time, it's a field where a number of private sector inves- tors are eagerly trying to get into what they see as a growth market with even Health Canada officials estimating there could be at least 400,000 legally registered medical users by 2024. To add to the complicated legal land- scape, a Tax Court judge ruled last year that even approved medical marijuana is subject to the goods and services tax be- cause it's more like an over-the-counter product than a prescription drug. Meanwhile, a new medical marijuana policy adopted earlier this year by the College of Physicians and Surgeons of Ontario states that approving cannabis use for a patient is equivalent to a pre- scription. For both people who are registered medical users and individuals and com- panies seeking to grow cannabis, it's a confusing time. "I sympathize with the patients," says John Fowler, a lawyer and president of Supreme Pharmaceuticals Inc., a Toronto-based company seeking a production licence. "We have had Band-Aid solutions," he adds. The Federal Court trial, which began in February in Vancouver, stems from an action launched by Neil Allard and three other individuals legally authorized to possess or produce marijuana under the marijuana medical access regulations that the government repealed in March 2014. The new framework, the marijuana for medical purposes regulations, requires users to obtain their medicine from a li- censed producer. The new framework doesn't allow patients to produce marijuana for them- selves or obtain it from an authorized caregiver as was possible under the previ- ous regulations. The plaintiffs obtained an injunction last year, which the Federal Court of Ap- peal upheld last year in Canada v. Allard 2014. The ruling permits licensees under the old scheme to continue to produce marijuana for medical patients until the constitutional challenge makes its way through the courts. The Federal Court proceeding has heard evidence so far that the costs for patients could be four to five times higher if they have to buy from private produc- ers as the new regulations don't regulate price. As well, certain strains of cannabis they have developed to deal with their symptoms wouldn't necessarily be avail- able. In the meantime, Health Canada is continuing to slowly approve new pro- ducers for the medical marijuana market under the new regulations. Health Canada had received almost 1,200 applications for a production li- cence as of the end of 2014, according to an affidavit filed in the Federal Court proceeding. It receives about 15 new ap- plications each week. So far, Health Can- ada has issued production licences to 23 companies. These companies have registered near- ly 15,000 clients, says Health Canada, and had sold about 1,600 kilograms of medi- cal marijuana by the end of last Novem- ber. The court documents also suggest the price can vary wildly from less than $2 per gram to as high as $15 per gram, al- though some companies offer discounts to low-income individuals. Fowler, whose past experience was within the medical marijuana commu- nity, says he understands the suspicion towards the private sector. "It will take some time before people transition," says Fowler. However, he suggests the old approach was a "broken system" that didn't serve patients well with many of them having to obtain their medicine on the black market. "We have a friendly black market in Canada. But there is no quality control," says Fowler. "The quality of medicine will improve dramatically over the next few years," he suggests, citing the prospect of private sector competition. His publicly traded company has a large property in southwestern Ontario and a management team that includes a horticulture professor, business execu- tives, and people with ties to the medical marijuana community. Fowler agrees that securities and health regulators need to have a strong oversight role to ensure the burgeoning industry has the confidence of investors and medical users. "The more we regu- late, the more credibility there will be in this industry and the better it will be for patients," says Fowler. Jennifer Thorne, a defence lawyer in Kelowna, B.C., who also advises clients seeking production licences, says the best regulatory framework would treat marijuana similarly to other prescrip- tion products available at a pharmacy. "It should be dispensed in a medical set- Litigation around medical marijuana has heated up ever since the government changed the rules around who can produce and supply it. Photo: Gordon Swanson/Shutterstock FocuS on Health/Life Sciences Law T LEGALFEEDS.CA A DAILY BLOG OF CANADIAN LEGAL NEWS FEEDS LEGAL POWERED BY V O T E D BEST NEWS BLOG CLAWBIES 2015 Untitled-6 1 2015-03-20 10:20 AM See Marijuana, page 22

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