Macedonian Company Finally Wins EU-GMP Certification

After clearing its way through EU-GMP certification, a North Macedonian company is now able to export medical cannabis products to the EU. How will this affect the landscape of medical cannabis in Europe?

In Macedonia, cannabis is not legal for recreational use at all, and there are no decriminalization or personal use laws to boot. However, in 2016, Macedonia did approve a bill for medical cannabis within the country. As per Macedonian laws, which sync with EU laws here, oils and extracts can have up to .2% THC and still be sold without a prescription.

Cannabis with any higher THC amount can be obtained through prescription. The laws allow for private citizens to make use of medical cannabis, as well as for Macedonia to enter into the legal medical cannabis market with laws to cover cultivation, production, and exportation for medicinal use.

Since that time, and according to internal legislation, Macedonia has been exporting extracts, oils, and tinctures, but that’s it. And while that does account for about 30% of the market, the great majority – 70% – relies on smokable hemp flowers, which Macedonia had not been cleared to export at all. Until now though, the EU was not included in exportable locations for any goods as no companies had EU-GMP authorization.

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What’s the biggest problem?

One of the biggest issues for Macedonia is that cannabis flowers have not been legalized for exportation. A big factor in this inability comes from internal licensing issues that stem from allegations of corruption. The allegations centered around former Prime Minister Zoran Zaev showing preferential treatment when giving out licenses, opting to give them to friends and family members which would, in turn, benefit him personally.

There were also a lot of questions and calls for specifications relating to how licensing would generally work, issues related to the program being government run, and opposition to the €500 bank guarantee that many thought would make it harder for smaller enterprises to gain ground.

With Zaev no longer in office, and with Corona issues subsiding enough to get back to regular business, the issue of Macedonia selling flowers can once again be broached. But in the meantime, while flowers might still be illegal for export, and while several companies have been awarded licensing for cultivation, only one company thus far has received EU-GMP clearance to export its products (by Macedonian law) into the EU, making Macedonia a new competitor in the medicinal marijuana game there.

So, who is it?

The company PharmaCann Polska received the EU-GMP certification to produce cannabis extracts (still not flowers) in its North Macedonia production facility. PharmaCann is actually based out of Warsaw, Poland, and received its EU-GMP certifications in March (amid Corona), by the Chief Pharmaceutical Inspectorate of Poland, after full inspections of the facility were made. The facility is reportedly an indoor growing operation that can both cultivate and manufacture products.

Zlatko Keskovski, PharmaCann’s CEO stated: “When I hear about the prices of medical cannabis extracts in Germany and other European countries, I can’t believe how expensive they are. We expect our production costs to allow us to be very competitive in the EU markets.” In fact, PharmaCann’s entrance into the EU medicinal markets (along with other companies that will follow in PharmaCann’s footsteps) is expected to have an effect on pricing, offering more competitive prices that could lower market prices overall. One of PharmaCann’s goals is to bring down production costs in order to make this possible. Considering how many companies want to get into the game, the competition is expected to greatly lower prices.

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PharmaCann is already setting itself up to be a main provider for Germany, offering wholesale services to pharmacies directly using its own distribution network within Germany. The company is also going to provide white-labeled products to German companies. White-labeled products are products produced by one company which do not have that company’s branding, but instead take on the branding of whatever company commissions the products to sell as their own.

In this way, many different companies can technically be selling the exact same product, even though all the packaging will look different, and the products will be sold under different company names. PharmaCann can use this to get its products in more places, while offering a product for sale to companies which want to sell cannabis products, but don’t have the ability to cultivate or manufacture them. This all works because Germany’s officials accepted the EU-GMP certification given to Macedonia by Poland.

According to Keskovski, the company has, in fact, already exported to non-EU countries like Australia, Slovenia, Brazil, Croatia, the UK, and South Africa. All these exports were reportedly of white-labeled products. PharmaCann cannot export flowers currently per Macedonian law, but the company is already getting ready for legislative changes by way of an even bigger facility in North Macedonia.

Is this the real story?

Kind of, but not really. Technically, Macedonia has been open for cannabis exportation since it changed its medical marijuana laws back in 2016, and a company getting an EU-GMP certification is relatively expected for any country not in the EU that wants to sell to it.

The much bigger, much more important issue in Macedonia is the ability to export flowers, the issue that was fought over and tabled partly due to former prime minster Zaev’s actions. While it’s great for PharmaCann to get its authorization, even PharmaCann knows that cornering 30% of the market isn’t nearly as good as having access to 100% of it, and that won’t happen until flowers can be exported.

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A story of disorganization

As of the end of February of this year, at least 47 companies have obtained cultivation licenses in Macedonia, although this has no bearing on the ability to export. It also doesn’t mean that there’s very good information being kept on any of it. The whole situation seems rather disorganized, perhaps in a rush-to-market kind of way.

Reports have come out saying that approximately €150 million euro have been invested, and 400-800 people are being employed in the industry, but there has been very little information released on production amounts, export amounts, or general sale amounts, making it hard to establish what is actually going on in Macedonia’s market. Just like the argument over licensing that got Zaev in trouble, Macedonia seems to have overall issues with corruption, some of which play into the lack of information being put out there.

One of the big issues is unethical lobbying by powerful groups, and the impact that has. This is coupled by incomplete or improper business plans, and a lack of follow-through by the government in terms of understanding global trends and being politically decisive. There is also a general lack of human resources training for the field, and what is considered by some, inhumane treatment of the population by pricing necessary medications above what the general population can financially afford.

Conclusion

Macedonia has been working its way into the global medicinal cannabis market since it changed its laws back in 2016. And even though the main issue of exporting smokable flowers has not been resolved, the country is chugging along anyway, handing out licenses, and finally having one of its companies awarded with EU-GMP certification to start selling to the EU.

Macedonian companies are sure to make an imprint on the medicinal cannabis market, likely bringing down prices by bringing down production costs, and introducing general competition. PharmaCann might be the first, but there are surely more authorizations to come, and if Macedonia can work out the kinks in its system (and even if it can’t), it will surely be changing the landscape of medicinal marijuana in the EU and beyond.

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