Growing Medical Cannabis Market... Domestic Countdown Underway

Low Hallucinogenic 'HEMP' and 'CBD' Already Used as Epilepsy Treatments

Government Also Promotes Medical Cannabis Industry Activation
HLB, Hwail, Medicox, Yuhan, and Others Participate

[Image source=Getty Images]

[Asia Economy Reporter Lee Chun-hee] The possibility of using cannabis, which has long been regarded solely as a drug, for therapeutic purposes is increasing. As the government hints at regulatory relaxation, companies in the domestic pharmaceutical and bio industries are preparing to enter the medical cannabis market.

The key to medical cannabis is its low psychoactivity. It involves using hemp (HEMP) containing very low levels of the psychoactive component tetrahydrocannabinol (THC), at 0.3% or less, or cannabidiol (CBD) produced from HEMP, for medical purposes. CBD is believed to help relieve stress and other symptoms without causing hallucinations. It is already being used therapeutically for pediatric and adult epilepsy, and there is potential for development as a treatment for brain disorders such as autism spectrum disorder in children, Alzheimer's disease, and dementia.

Overseas, after the United States legalized HEMP as an agricultural product in 2018, the Food and Drug Administration (FDA) approved the cannabis-based epilepsy treatment 'Epidiolex,' expanding the scope of food and pharmaceutical uses. In Europe, the European Court of Justice ruled that CBD is not considered a narcotic. In Korea, CBD oil is currently covered by health insurance for pediatric epilepsy patients and supplied through the Korea Orphan and Essential Drug Center. The prescription scale is estimated to reach 400 billion KRW.

[Image source=Pixabay]

Efforts to secure market dominance are ongoing industrially as well. Ireland's Jazz Pharmaceuticals acquired GW Pharmaceuticals, the developer of Epidiolex based in the UK, last year for $7.2 billion (approximately 10 trillion KRW), accelerating the expansion of the cannabis pharmaceutical industry. In March, Jazz announced plans to invest $100 million to build a new manufacturing plant in the UK, which will begin operations in 2024. The plant will produce not only Epidiolex but also Nabiximols, a treatment for advanced multiple sclerosis currently in Phase 3 clinical trials, developed by GW.

Domestically, following the government's recent approval of manufacturing and importing cannabis component medicines as part of the top 100 regulatory innovation tasks in food and drug sectors, it is also reviewing separating HEMP from narcotics. This has raised expectations that a medical cannabis market could form in Korea.

The government and local authorities have also taken direct action. By 2024, Andong City in Gyeongbuk Province will be designated as an 'Industrial HEMP Regulatory Free Zone' and will undertake demonstration projects. These include industrial hemp cultivation trials, raw material pharmaceutical manufacturing and export demonstrations, and industrial hemp management trials.

Medical Cannabis Cultivation Facility of Australian Green Farmers Invested by Medicox (Photo by Medicox)

In the industry, investments in related companies are actively taking place. HLB Group signed a business agreement with NeoKen Bio, which develops cannabis-related active pharmaceutical ingredients (API), investing about 2 billion KRW to develop medical cannabis. Hwail Pharm also acquired a 49.15% stake in Cannabis Medical last year. Cannabis Medical is developing CBD as a preventive and therapeutic agent for degenerative brain diseases.

Medicox partnered with Green Farmers, an Australian cannabis cultivation specialist, to secure cannabis raw materials. After signing an exclusive import contract for cannabis raw materials in June, Medicox decided to invest directly in Green Farmers, claiming to have secured a 99.9% pure CBD strain.

Yuhan Health Care teamed up with InventiGel to develop a long-acting injectable new drug for medical cannabis. They plan to combine Yuhan Health Care’s medical cannabis candidate 'YC-2014' with InventiGel’s long-acting injectable platform 'IVL-DrugFluidic' to develop a new drug.