Becoming a Recreational Cultivator
We are already preparing applications so our clients can be first out of the gate. Don’t miss this once in a lifetime opportunity.
Cannabis Compliance Inc. has prepared and rescued a significant number of ACMPR applications for medical production, including some of Canada’s largest applicants. Our team has real-world experience among Canada’s leading producers such as Tweed Farms, 7 Acres, Delshen, Prairie Plant Systems and Aurora Cannabis. We offer all of the required expertise in-house for security, cultivation, quality, regulatory and financial planning, and we have partnered with Canada’s industry leaders for construction, security, equipment, marketing and software.
As of early April 2018, recreational cannabis is still illegal, but the federal government is in the final stages of passing legislation that allows for the cultivation, distribution and retail sales of recreational cannabis. This has not happened for any G7 country in the world to date. Canada has committed to making these plans effective by August 2018, which is a very aggressive time frame.
All recreational cultivation facilities will be licensed and heavily regulated in a manner similar to the current medical producer licensing framework (under the Access to Cannabis for Medical Purposes Regulations, ACMPR). The Proposed Approach to the Regulation of Cannabis outlines a number of cannabis cultivation licenses including standard cultivation, micro-cultivation, nursery, and industrial hemp licenses. Every business will need to understand the distinctions between each class of license to ascertain which will serve them best. Micro-cultivation licensees, for example, are released from some cumbersome security requirements in exchange for limiting their production levels to a threshold set by Health Canada.
Under only current legal cannabis cultivation scheme (the ACMPR), a company that wants to cultivate medical cannabis must submit an application to Health Canada. It is a very documentation-intensive process, which our firm excels in. The significant requirements are the security measures, a pharmaceutical-like quality assurance program, record keeping proficiency and of course a cultivation program and business plan. These applications are easily a thousand pages, and a similar application format is expected for all classes of cultivation license under the new framework. New hopeful recreational producers should be preparing now for their applications.
Building a cannabis cultivation facility will require capital in the range of $100 to $400 per finished square foot, depending on whether a greenhouse or indoor facility is chosen. At the application stage, consulting and legal fees are approximately $300,000.
Can a company wanting to cultivate recreational cannabis get ready today and gain an advantage for getting into queue? The quick answer is yes. Licensed producers under the medical system will be permitted to also supply for the recreational market. Many of the large producers are already prepared for this (e.g., Tweed has always been a recreationally focused brand).
The time frame for gaining approval for a medical production facility is roughly one to two years, hopefully faster given the looming market demand. This means that if a company applies on May 1, 2018 to become a medical producer, they might gain a licence to cultivate by the summer of 2019. Of course, given that it takes up to a year to construct a facility, this means that the build-out should commence immediately and in parallel to submitting the application.