Israel Can Export Medical Cannabis After Passage of Knesset Law

December 27, 2018

5 min read

A decade ago, the idea of supplying Israelis with cannabis was considered outlandish and inconceivable; marijuana was regarded by the Israeli leadership as a drug taken by hippies from the counterculture of the 1960s who wanted to get high.

Two decades ago, a political movement whose main issue was advocating the legalization of marijuana named Alei Yarok (Green Leaf) was set up and eventually ran six times as a political party since 1999, but it attracted only a few tens of thousands of votes each time and never met the electoral threshold because it was considered a laughingstock.

But a lot has changed since then, and there is no need for a political party to advocate Alei Yarok’s goals. Today, nearly 50,000 Israeli patients are licensed by the Health Ministry to buy medical cannabis to ease pain and treat other conditions (the actual demand by patients is probably several times greater).

Alei Yarok, chaired by Oren Lebovich, continues to exist as a movement and even publishes the Israel Cannabis Magazine

However, cultivation of cannabis for medical purposes that would be exported abroad was not approved due to conservatism. After the Likud government realized a couple of years ago that such an export crop could bring in huge sums, US President Donald Trump whispered to Israeli Prime Minister Benjamin Netanyahu that this was a Republican taboo and urged him not to allow it. Economic considerations and the powerful lobby to allow such a sector to thrive apparently tipped the scales against Trump’s “advice.”

Israeli cannabis producers continued to develop for the local market, but they feared they had missed the boat for the growing liberal market fueling the cannabis revolution around the world.

This week, the Knesset plenum approved on its second and third reading a bill to amend the Dangerous Drugs Ordinance of 2011 and change the law. Only 21 members of 120-member Knesset were in the plenum, but all of them voted to approve the bill.

The bill states that any license to engage in medical cannabis will be subject to an export license from the Health Ministry. The bill states that its purpose is to regulate cannabis trade and maintain a clear separation between the ban on all trade in cannabis as a “dangerous drug” and the export of medical cannabis. The goal is to regulate the export of medical cannabis and allow the creation of a such a market for Israeli exports, which will provide the state coffers with an estimated NIS 1 billion each year.

The law provides a budget that allows the Interior Ministry and specifically the Israeli Police, to monitor, track and control the production and delivery of cannabis for export, and ensure there is no risk of leakage to the local illegal drug market.

The police will be required to give its recommendation to would-be exporters within four months, and in the case of a foreign investor within six months.  According to the wording formulated in the committee, anyone who violates the terms of the license to engage in medical cannabis production and export will be liable to 24 months’ imprisonment or a fine of 75,000 New Israel shekels.

There are currently eight medical cannabis companies operating in Israel and a handful involved in the production, marketing and distribution of medical cannabis. Numerous farmers have already received licenses to grow it, but they were leery to join in because exports were legalized.

Several months ago, a number of farmers who would like to become legal cannabis growers filed a petition in the Jerusalem District Court to force the state to make a decision on licensing requirements.

Entrepreneurs and researchers, as well as the business owners themselves, tell of many requests from all over the world that Israel is seeking to purchase from Israel’s high-quality produce, and to learn from the accumulated knowledge of 15 years of the Cannabis Medical Project in Israel. Israel has an excellent climate to grow cannabis, which also grows easily like weeds and without much water. Israeli also has significant expertise in agricultural and medical technologies.

The Knesset decision makes Israel the third in the world – after Holland and Canada – to legalize the export of medical marijuana abroad. Other countries that apparently want to do business with Israel are Mexico, Austria, Australia and Germany. The law will go into effect in six months.

The reluctant government approval of medical cannabis use and exports is ironic, as a prominent Israeli organic chemist – 88-year-old Prof. Raphael Mechoulam – is a world pioneer in cannabis research.

Mechoulam, a graduate of the Hebrew University of Jerusalem and the Weizmann Institute of Science in Rehovot, is best known for his and his research group’s work in the isolation, structure elucidation and total synthesis of Δ9tetrahydrocannabinol, the main active ingredient of cannabis and for the isolation and the identification of the endogenous cannabinoids anandamide from the brain and 2-arachidonoyl glycerol from peripheral organs.

The Health Ministry, which has been headed for most of the past decade by ultra-Orthodox Deputy Health Minister Ya’acov Litzman, has opposed cannabis because strict rabbinical arbiters didn’t like the idea of approving such drugs. But this has changed due to public demand from patients, including ultra-Orthodox ones. Last April, Litzman and and his director-general, economist Moshe Bar Siman Tov, toured a Jerusalem pharmacy that is authorized to supply medical cannabis by prescription to patients who need it to relieve pain and for other serious conditions.

“I am glad that we succeeded in implementing medical cannabis reform that will make it more accessible to licensed patients,” Litzman said. “The move will prevent suffering from those who are required to use this medically [and] deal with the unnecessary bureaucracy that exists in the field…Cannabis is a drug, so this is not a legalization for all but a practical arrangement for patients who have received special permission. We will continue to fight leakage and will not allow those who do not have legal authorization to use drugs as required by law. With regard to the price, we intend to supervise to prevent price rises,” Litzman said.

As part of the pilot program, patients with medical cannabis licenses will be able to go to any of 25 pharmacies around the country that are participating in the program and obtain medical cannabis by prescription. The drug will be sold as green leaves in a bag, as oil or in the form of tablets. However, patients pleading to get licenses claim that the ministry bureaucracy still makes getting approval much too slow.

Bar Siman Tov added, “The reform is progressing, and we will make it easier for patients to obtain medical cannabis… The geographical distribution of the pharmacies will grow as quickly as possible at the end of the initial pilot period.” Until now, licensees often had to go to distant suppliers to get the drug.

Meanwhile, iCAN – an Israel-based accelerator and services company that invests in cannabis products and solutions – happily greeted the new law. Its CEO, Saul Kaye, said: “This is a long overdue but welcome development.  iCAN has been diligently working together with Israeli regulators to further the growth of the cannabis industry with the goal of having Israel become the leading global export nation of medical cannabis. Israel, already the most advanced nation in cannabis R&D will now be able to produce and market cannabis and cannabis-based products that will help millions of people suffering from illnesses including cancer, multiple sclerosis, Parkinson’s disease, sleep disorders, epilepsy, and post-traumatic stress disorder, to name just a few.”

Kaye added that “Israel is perfectly positioned to enter the medical cannabis market that is expected to soar to $33 billion dollars worldwide in the next five years.  In Israel alone, we quickly expect over $1 billion in sales to countries interested in our products.”

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