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Big Pharma Stands to Lose $4 Billion to Medical Marijuana

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[DIGEST: The Cannabist, Rolling Stone, Boston Globe, The Guardian]

In states where medical cannabis is legal, patients are turning to weed for relief from a variety of ailments, including chronic pain, PTSD, anxiety, sleep disorders, epilepsy and side effects of chemotherapy. They say the treatment is effective, has few side effects, and is less addictive than traditional pharmaceutical prescriptions, making it a powerful tool in the fight against prescription drug abuse and opioid addiction.

However, the migration from Big Pharm to weed farms is costing the prescription drug industry millions of dollars. A new study by New Frontier Data, a provider of data and analytics to cannabis businesses, suggests that as legalization takes hold in an increasing number of states, the pharmaceutical industry could lose as much as $4 billion a year in lost revenue.

Some drug companies are looking for ways to tap into this controversial ingredient to create new products. Others are looking for ways to fight legalization. How one of the nation’s most powerful lobbies responds to this threat could reshape medicine and drug laws.

An Escape Route from Opioids

The New Frontier study analyzed a 2016 report by the University of Georgia that showed a decrease in Medicare prescriptions in states with legalized medical marijuana. These findings have helped support a national conversation about how legal marijuana could help ease the nation’s escalating opioid addiction epidemic. While Attorney General Jeff Sessions has called marijuana “only slightly less awful than heroin,” some states are looking at the legal drug as a tool to help opioid addicts manage withdrawal symptoms, calm cravings, ease pain and ultimately kick their dangerous habit. Legal medical marijuana also gives doctors a safer alternative to the dangerous painkillers that can lead to opioid addiction.

Marijuana
Credit: Source.

A 2014 study published in JAMA Internal Medicine, which examined data between 1999 and 2010, found that states with medical marijuana laws had a 25 percent fewer fatal opioid overdoses compared to states without such laws. 

A 2017 National Academy of Sciences report dispelled the theory that using marijuana can lead to opioid addiction and instead found evidence that cannabis has therapeutic and health benefits. 

“Any opportunity for alternatives that could result in reduced pharmaceutical drug use might present a compelling point of discussion from a public policy standpoint,” said John Kagia, executive vice president of industry analytics for New Frontier.

In addition to its health-related benefits, legal cannabis has the potential to save taxpayers significant dollars. The New Frontier study looked at Medicare costs between 2010 and 2013, and found that in states that offered legal medical marijuana, prescription savings dropped by $165.2 million a year by 2013. If medical marijuana were legalized on a national level, taxpayers could save $1.1 billion a year on Medicare prescriptions.

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