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Oct 1, 2018

Canadian pot producers emerging as major lobbyists ahead of legalization

Spending billions on pot: The economic impact of Canada's cannabis industry


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Ottawa paved the way for Canada to legalize recreational marijuana next month, but some cannabis giants still want more – actively lobbying the government on various pot matters and legislation in order to shape their burgeoning industry well beyond Oct. 17. 

Canadian producers Tilray Inc. and Canopy Growth Corp. are among the biggest lobbyists in Ottawa, according to an analysis of publicly available records over the past 12 months, as the companies aim to influence policymakers ahead of legalization.

Nanaimo, B.C.-based Tilray has lobbied the Canadian government 29 times in the past year, while Canopy has lobbied politicians on 27 occasions, both on par with major blue chip firms like Wal-Mart Canada Inc., Inc., Royal Bank of Canada and Royal Dutch Shell Plc, according to the data.

“If you’re looking to get anything done and get policy implemented, you’re going to have to lobby,” said Deepak Anand, vice president of business development and government relations at Cannabis Compliance Inc., in an interview with BNN Bloomberg.

“It’s definitely a necessary evil. You’re not going to get your point across without lobbying.”

Anand noted that lobbying efforts with cannabis have traditionally been rooted in the medical segment but with adult recreational usage set to be legal, some companies are looking four to five years ahead to help set an agenda that could ultimately benefit themselves and other commercial pot operators.

“You want to be at the forefront of what that change looks like and lobbying is an attempt to get in front of how policy gets developed around those product forms and other related initiatives, such as retail,” he said.

Canopy Chairman and Co-CEO Bruce Linton said that the Smiths Falls, Ont.-based company has engaged in lobbying efforts to help identify ways to ensure that the government’s legalization plans can effectively strike out the black market and benefit commercial producers.

“It’s not that we’re introducing cannabis to the world, but we’re trying to stop people from buying it from illegal suppliers,” Linton said in an interview with BNN Bloomberg.

Canopy has lobbied the government on its preference to include several cannabis form factors such as edibles and vaping when marijuana is legalized on Oct. 17, Linton said. Those forms of cannabis are expected to be legalized later in 2019.

Linton said he has met with politicians on two occasions but the bulk of Canopy’s lobbying has been led by internal government relations staff.

“We did achieve some positive outcomes in supporting [the government’s] logic with this but there is more work to do,” Linton said.

Meanwhile, Zack Hutson, vice president of corporate affairs at Privateer Holdings, the parent company of Tilray, said the firm is trying to bring Canadian officials and policymakers a global perspective of how cannabis is being used when drafting legislation. 

“We feel it’s important to get engaged and offer the perspective of a commercial operator of what success looks like when it comes to regulation,” Hutson said.

Hutson added that some the company’s lobbying efforts have been directed at removing taxes from the sale of medical cannabis so patients don’t bear the brunt of that cost. Tilray has also advocated for insurance company reimbursement policies, and weighed in on the potency of some cannabis products including vaporizer devices, he said.

“We view it more as an education. We want to make them aware of policies and what policies mean from a market perspective,” Hutson said. 

Tilray and its parent Privateer have also lobbied the U.S. government in Washington D.C. in the past several years, according to U.S. lobbying records, but Hutson said the company isn’t active in the country anymore.

“It’s possible we may engage in the U.S. in the future, but right now we’re focusing on Canada and other countries,” he said.

Other major companies in the sector such as Aphria Inc., Aurora Cannabis Inc., Newstrike Brands Ltd., and Hexo Corp. have all registered at least one visit to an Ottawa-based politician over the past year, records show.

Aphria enlisted public relations firm Edelman Canada to lobby on its behalf, mostly to convince policymakers to allow cannabis extracted into vape cartridges to be legalized earlier than the expected October 2019 date, the company’s chief executive Vic Neufeld said in a recent interview.

Currently, vape pens with cartridges filled with cannabis oil are a big part of the illicit market, and could constitute as much as 15 per cent of legal pot sales, Neufeld said.

“I’m not a big proponent of lobbying efforts in general, but where it makes sense we are raising awareness of issues important to Aphria with lawmakers.”

Cannabis Canada is BNN Bloomberg’s in-depth series exploring the stunning formation of the entirely new – and controversial – Canadian recreational marijuana industry. Read more from the special series here  and subscribe to our Cannabis Canada newsletter to have the latest marijuana news delivered directly to your inbox every day.