Interview with Verdemed
We recently caught up with Lucila de Campos from Verdemed, one of iCDPs event partners. Read the interview to find out more about Verdemed, their expansion into Latin America and the opportunities and challenges they currently face.
For those who don’t know much about Verdemed, could you describe the company and the driving forces behind it?
Verdemed is a Canadian company working to improve the health of millions of patients. We are a small company with 20 employees, and the founders are doctors and executives from Brazil and Colombia. The company is structured in three business units – Agro, Care and Pharma – which focus on B2B markets, B2C markets and pharmaceutical development, respectively.
Brazil, Colombia and Chile are key markets in the first phase of Verdemed’s expansion, which began in 2018 with the acquisition of a hemp oil extraction plant in Colombia, a country where Verdemed will be supplying raw materials for B2B markets, as well as offering a cannabis-based cosmetics portfolio for the consumer market.
The expansion into Latin America was followed by the opening of a commercial office in São Paulo, the largest city in Brazil, in March 2019. This operation has been addressing the current demand of Brazilian patients medical cannabis initially for importation on a one-to-one patient basis, accordingly to current legislation, while supporting patients and physicians with a program of awareness, knowledge and access to products through a digital platform called Verdemed Care. The point of differentiation for our products is their pharmaceutical-grade certification. We aim to expand our operation in 2020 and onwards to Chile, Argentina, Peru and Mexico.
Verdemed pharma will bring to market high-quality and cost-effective pharmaceutical products. As with any other pharmaceutical product, medicinal cannabis needs to undergo rigorous testing to ensure that it is fit for human consumption and is delivered at the level of potency necessary to provide the intended medical outcomes. The mission of VM Pharma as a business unit is to bring the best cannabinoid-based pharmaceuticals to doctors and patients.
At a corporate level, Verdemed’s mission is even more ambitious: to become the cannabis brand of choice in Latin America.
Given the initial focus on providing existing formulations that are already available in the United States, Canada and Europe, why has it taken so long for these medications to reach Latin America?
In Latin America, the relevant legislation in each country permits different levels of cultivation, distribution and manufacturing. More recently, countries in the region have been changing their attitudes towards medical cannabis.
A total of eight countries across Central and South America have legalized some form of medical cannabis. Uruguay paved the way with its legalization of cannabis in 2013 and other countries, such as Colombia, Peru and Chile, now have more flexible rules for distribution, cultivation and manufacturing. Mexico and Argentina have an import-only market for medical use. Brazil is at a medical cannabis crossroads, and since 2015 has legalized medical cannabis for importation only on a one-to-one patient basis. Last June, the Brazilian Health Regulatory Agency (ANVISA) approved two draft resolutions to permit medical cannabis cultivation and the registration of medical cannabis, which are being evaluated in public consultations.
These different legislative scenarios are the cause for the delay in these medications becoming available in Latin America. Many patients with severe and disabling diseases have not been able to import the products because of their high cost.
Verdemed demonstrates its commitment to accelerating access to cannabis in Latin America by participating in advocacy, developing relevant medical education programs and leading awareness campaigns such as #CBDlegal, which was recently launched in Brazil. However, the company will always act strictly in compliance with local regulations.
How do you think this will change treatment for Latin American patients moving forward?
The efficacy and safety of cannabis have already been demonstrated in many randomized trials. Access to regulated medicines will allow millions of patients in Latin America to be treated in their own countries and to be given a pharmaceutical product that is subject to quality control standards. Cannabis testing is indeed the only way to ensure product quality and medical efficacy. The costs of these products will also be lower than the costs involved in importing on an individual patient basis.
New applications for medical cannabis are being investigated. Patients from Latin America will also have the opportunity of participating in clinical trials planned for a Verdemed development program, for applications that address conditions such as sleep disorders and pain.
With few choices, patients are constantly seeking alternatives. In this context, medical cannabis emerges not just as a new treatment, but as a restoration of hope. For physicians, scientific evidence has been gradually demonstrating higher levels of safety and proven efficacy, which has been speeding up the process of acceptance.
Cannabis and the cannabinoid space are presented as having quite a unique array of challenges. I would love to hear what you think are the biggest challenges for this industry in the foreseeable future.
Entering the Latin America market poses investment challenges. In combination with government regulations and high costs, obtaining licenses and efficiently operating a cannabis business is difficult. The biggest economic players in Latin America, such as Mexico and Brazil, still need stable legal frameworks to support cannabis production and medical cannabis registration.
However, challenges also represent opportunities. For companies that are now adapting their short-term strategy to compete in those markets in compliance with local regulations, the knowledge acquired on this journey, backed up by an intelligent financial strategy, will create a foundation for a productive pharmaceutical market in the future.
Now, if we were to go the other way and talk about the opportunities, what do you see?
For medical cannabis, one opportunity is clear – the 17 million medical cannabis patients in Latin America. Other opportunities involve producing cannabis and cannabis-based products locally. The conditions that support a strong agricultural sector are just as advantageous for the cannabis industry. The low cost of land and labour and the nearly year-round growing season make cultivators eager to open for business. The novelty of cannabis in Latin America also opens the door for companies offering alternative health, food, beverage and cosmetics products – to name a few industries this versatile plant can compete in.
According to a recent New Frontier report, the market opportunity for cannabis to address in Latin America could reach US$10 billion dollars, with Brazil, Mexico and Chile offering the greatest potential.
For most companies, regulatory challenges present a significant hurdle. How has this altered your experience working in this space?
The regulatory environment in Latin America is also changing with the legislative changes. Brazil, which had the most restrictive rules, just opened public consultations to review the registration procedures for medicines manufactured with cannabis and its derivatives or synthetic analogues, and possibly to allow the commercialization of products that have proven comparability with reference drugs or that have completed only the second phase of clinical trials. ANVISA officials have suggested that such resolutions would be enough to regulate cannabis cultivation and the process of registering cannabis-based medicines, as the agency is mandated to do under laws that are already in place.
This is an obvious hallmark of an increasingly global cannabis industry. How do you see this global approach developing in the coming years?
With the population of Latin America now at about 620 million, the cannabis market is emerging as the next platform for global expansion. The appeal of this opportunity is based on the size of the market, access to good quality land with an ideal climate, and lower costs of production. As a result, the Latin American region expects to be a leader in the medical cannabis sector in the coming years.
New initiatives related to cannabis have also been emerging in the past few months, both in Latin America and around the world, such as events, equipment, digital content and tools, support for the purchasing process, business consulting, data analysis, and audit and certification processes. Cannabis, with its hundreds of applications, can be viewed as a game changer in the future.