In Legalizing Marijuana, Canada Did Everything Differently.

Jul 23, 2019

MONTREAL — Michael Rolli made his first purchase of legal marijuana in Canada earlier this year, walking into a sleek, glass-walled storefront in downtown Montreal that was run not by a private, profit-seeking company, but by the government.

 

Having bought a few grams of weed, he walked out onto the sidewalk and with a flick of his thumb sparked up a pre-rolled joint. Office workers on their lunch breaks streamed past without a second glance. Unlike anywhere in the United States, smoking pot in public is legal here, in certain areas.

“This is pretty perfect,” Rolli, 25, said, inspecting the cone shape of the joint. “My friend can roll good joints, but this is better — it’s like the Olympic torch.”

This is the world of legal marijuana in Canada, which last October made history as the largest country to legalize pot, and the first to create large-scale government-run cannabis stores in addition to private shops.

Canada went about legalizing pot very differently from Massachusetts: It opened more than 100 cannabis stores overnight, and now has a mix of publicly run and privately owned retailers. That compares to the painfully slow rollout of retail options in Massachusetts, where private companies undergo a lengthy application process. However, products that are already popular in Massachusetts, edibles and vape pens, were banned by Canada during the first year. Canada also has a different approach on age cutoffs, public health controls, social justice issues, and the role of big corporations.

But for those frustrated with the glacial pace and limitations of the Massachusetts legal marijuana market and looking north for inspiration, Canada’s experience suggests there is no perfect system. Prices are high, products are few and in short supply, and the stores have long lines. As here, pot smokers there have mixed feelings about the shape of legalization, while opponents try to block its spread.

Maybe most revealing is that both Canada and Massachusetts continue to have flourishing black markets that undermine the legal industry, as consumers still find it easier and cheaper to shop in the shadows.

The government-run pot stores are “professional, clean, and basically well-organized,” said Byron Hardie, 33, a massage therapist in Montreal. But he prefers buying online from an unlicensed delivery service, which is “far superior, with better prices and better selection, and it comes right to my door.”

Canada’s government sees itself as unique among weed dealers: It wants to put the illicit market out of business while still tempering the availability of pot, particularly just to people who already consume it. In Quebec, officials designed stores to ensure that children passing by cannot see any cannabis. They even banned sales of merchandise that could promote pot consumption, including posters or T-shirts with images of pot leaves or “420.”

“We don’t want cannabis to become as mundane or common as alcohol,” said Fabrice Giguère, a spokesman for the Quebec cannabis authority, Société Québécoise du Cannabis, or SQDC. “We want our prices to be competitive with the black market, but not so competitive that it becomes a benign product, because it’s really not.”

While happy weed is legal, cannabis consumers interviewed in Montreal are not exactly overawed by the government’s first year.

“Now, you can go buy marijuana without being scared that the police are going to get you,” said Brandon Golib, 20, who works in a restaurant. He said the SQDC stores offer a great experience with knowledgeable staff. But, “the only downside is they didn’t have enough for the whole of Montreal” in their early months due to supply shortages, Golib said.

The minimum age to buy pot in most Canadian provinces is 19; Quebec is slated to raise the minimum from 18 to 21 this fall.

When pot was illegal in Canada, minorities were far more likely to be arrested than whites, as was also true in the United States. Legalization has made it easier for people with pot convictions to apply for pardons.

But Canada made no effort to create business opportunities for people in those communities that saw high prosecution rates during the war on drugs. These social justice goals were a cornerstone of legalization in Massachusetts and other US states.

One area where some in Massachusetts want to take a page out of Canada’s playbook is having the government sell pot, instead of private companies. That, public health advocates say, would remove the profit motive, which history has shown — with alcohol, tobacco, and opioids — leads companies to lobby for looser rules, obscure health risks, and push increasingly addictive substances on the young.

Canada’s strict rules contrast with the scene in Massachusetts, where a billboard by the website Weedmaps greets travelers near Logan International Airport: “Smile Boston, weed is legal.”

In a May letter to Massachusetts leaders, more than 40 local doctors and scientists implored the state to adopt regulations that prioritize public health efforts like those in Canada: government control of sales, precise warning labels about mental health risks, stricter bans on advertising and medical claims, and oversight by a health authority.

Currently, labels on pot products in Massachusetts say, “There may be associated health risks,” and warn against consuming before driving or while pregnant or breast-feeding.

“Businesses are supposed to sell more of their product to make more money, but that’s really very dangerous with addictive substances,” said Dr. Sharon Levy, director of the substance use program at Boston Children’s Hospital, and one of the letter’s signatories. “What Canada’s worked to do is counterbalance that profit motive. . . . In Massachusetts, my understanding and my experience is that’s not really the consideration.”

For their part, Massachusetts regulators say they are effectively prioritizing both public health and social justice, which are not at odds.

The verdict on which cannabis policies are more effective for public health is likely years away. But many studies on retail sales of alcohol, including one in the American Journal of Public Health, show that government-run stores were linked to lower rates of alcohol consumption and youth access.

While cannabis is viewed by some as safer than other drugs, there is research suggesting a link between heavy, high-potency cannabis consumption and psychosis.

Five Big Companies

On the business front, with access to financing from the stock market and banks, Canada’s private pot companies have become huge, dominating the market and benefiting from economies of scale. That differs from the US model, where federal prohibition on marijuana means each state’s system is independent and financial institutions are wary of getting involved.

By some estimates, Canada’s five largest cannabis companies — Canopy Growth, Aurora, Hexo, Aphria, and Organigram — control 73 percent of the recreational pot market. Social justice advocates say that’s no surprise: Canadian health and safety regulations are so onerous that only large corporations can afford to comply.

“Rich venture capitalists and corporations run by the richest people on earth are robbing money and opportunities away from the people who built this industry,” said Jodie Emery, a prominent cannabis activist who was convicted of running unlicensed marijuana dispensaries across Canada. “The benefits of legalization could’ve been far beyond health — job creation for so many people on a smaller scale.”

Leaders of Canada’s major weed companies say they’re revitalizing the economy.

In Smiths Falls, nestled amid farmland an hour south of Ottawa, Canopy Growth Corp. has its headquarters in a former Hershey’s chocolate factory. Canopy employs about 1,200 people in a town of 8,780 that struggled after the closure of Hershey’s. Inside the campus buildings, tidy rows of thousands of marijuana plants of all sizes grow in white fluorescent-lit rooms. Workers use cranes to lift bales of cannabis.

“ ‘Corporation’ is a funny way to put it because it doesn’t feel like that,” said Canopy spokesman D’Arcy McDonell as he walked through rooms pungent with the smell of marijuana. “We believe cannabis can be a force for good. For a town like Smiths Falls that was really down and out, it’s a big boost.”

Trudeau’s Promise

The seeds of Canada’s cannabis journey were planted in 2015, when Prime Minister Justin Trudeau made legalization a campaign promise.

Canada — which gave the world Seth Rogen, Neil Young, and Drake — had long tolerated weed, especially in the cities and on its west coast. Medical marijuana has been legal since 2001.

But Trudeau’s push was still controversial, opposed by conservatives, doctors, and police. Parliament finally passed the law after political negotiations yielded changes such as provinces being able to ban people from growing cannabis at home. Federal law allows four pot plants per household.

Nine months after legalization took effect, Trudeau’s office declared it a success.

“Our plan is working,” said spokeswoman Marie-Emmanuelle Cadieux. “After only a few months, we have already displaced a sizable portion of the illicit market and the rate of consumption remains unchanged. Additionally, we have seen no evidence of a rise in youth consumption, drug-impaired driving, or problems at the border.”

However, unlike Massachusetts, Canada also taxes medical marijuana — at 10 to 15 percent — in part because officials feared recreational consumers would migrate to the medical market to avoid taxes. Many patients label the tax unfair.

Daphnée Elisma, 44, of Montreal, uses cannabis to relieve severe stabbing neuropathic pain resulting from cancer surgery. It costs her $500 to $600 a month. In a country with public health care, she said, the taxes and the government’s unwillingness to pay for the treatment amounts to discrimination.

“It’s really an unfair burden on patients’ shoulders — we’re using out of medical necessity, not for fun,” said Elisma, a patient advocate with the Santé Cannabis clinic. “The world is looking at us now, and it’s time for us as a country to show the world how to move forward.”

Another consequence of legalization for Canadians is that the border crossing to the United States has gone from relatively routine to a fraught encounter for pot consumers if US agents ask about their use. Some Canadians say they have been banned from the United States for answering affirmatively.

Small Businesses Shut Out

Inside a brick house in a hip Montreal neighborhood, a woman is folding colorful Japanese papers around chocolate bars, next to a kitchen with industrial mixers and bowls.

This is the headquarters of a successful business selling marijuana-infused chocolates that has five employees and thousands of customers — but is not licensed to operate legally. The company founder, a 34-year-old man who asked that he and his business not be identified for legal reasons, said legalization has been great for his operation. Since edibles aren’t sold in stores yet, customers turn to online businesses such as his. The chocolates cost $10 to $25 and come in such flavors as dulce de leche, orange, spicy pepper, and mint.

Canada’s legal framework excludes small-scale entrepreneurs like him, said the founder. He cannot raise the estimated $10 million needed to retrofit a building and apply for licenses on his own. His best hope is to be acquired by a legal company.

“This whole process has been handing over a highly profitable industry from a segment of society that needs it, to people and money coming over from tobacco and pharma and alcohol,” he said. “They’re already doing fine.”

Unlike Massachusetts’ regulators, Canadian authorities don’t see their core mission as fostering businesses of any size or demographic. The Quebec SQDC, for example, has contracts with the nation’s six biggest companies to keep up with demand, which has been a struggle.

“Our focus is to get the product,” Giguère said, adding the agency eventually would like to include smaller players.

Trudeau’s advisers recommended the industry include small businesses, but Health Canada prioritized safety in the same way as it does with pharmaceuticals, without consideration of the business cost, said Ivan Ross Vrána, a former government policy adviser who now consults for the industry.

“The regulatory burden and what companies have to go through is extremely high,” Vrána said. “We’re almost treating this plant like it’s plutonium.”

Canada has a tough fight ahead to beat the black market.

By some estimates, roughly 80 percent of sales occur under the table. In the last quarter of 2018, Canadians spent $5.9 billion on cannabis — only $1.2 billion was through legal channels, according to Statistics Canada. One factor: Consumers reported average prices at legal suppliers were 33 percent higher than illicit ones, the agency said.

Quebec regulators knew winning over consumers would take time, and so set modest goals: eliminate 30 percent of the black market in the first year, then 70 percent in five years. To that end, Quebec plans to triple the number of stores to 43 by next March.

But for some consumers, that won’t resolve an underlying concern.

“I don’t trust the government. I definitely don’t want my name on any government list,” said Caroline McGee, 24, a bicycle courier in Montreal.

While she avoids the government stores, she said legalization has its benefits. “Now that it’s more socially acceptable, generations of people who would usually be very anti-marijuana because of law-fearing reasons are now engaging with it, and hopefully finding some relief.”

Source — The Boston Globe and Naomi Martin

 

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