“You’re going to see insurance companies slowly start to creep into the sector,” says Khurram Malik, an analyst at Jacob Securities Inc., noting that the new regulations will allow licensed producers to sell gel caps similar to those made from cod liver oil. This will allow for more precise dosing, Malik says.
“When you’re trying to smoke a plant you have no idea how much you’re consuming, so that makes doctors a little nervous,” he said.
Experts say the changes are a major step towards legitimizing the drug in the eyes of doctors and insurers.
“When something doesn’t look different than other medicines, it becomes much easier for people to get comfortable with the idea that this is, in fact, a possible treatment option for patients,” says Bruce Linton, the CEO of Tweed, an Ontario-based LP.
LPs still have one major hurdle to overcome before insurers begin routinely funding the drug: cannabis currently doesn’t have a drug identification number, known as a DIN.
“If it was issued a DIN by Health Canada, it’s quite likely that the insurance companies would cover it,” says Wendy Hope, a spokeswoman for the Canadian Life and Health Insurance Association Inc.
“To obtain a DIN, the new form of medical marijuana would need to go through the full Health Canada approval process like any new drug.”
Malik doesn’t think that will be an issue.
“You’re going to see a lot of Canadian companies partnering up with universities overseas that are a little more progressive than the ones we have here, at least in this space, to drive this research forward and legitimize it in the eyes of doctors and get DIN numbers on these things,” he said.
Malik says there is a financial incentive for insurers to cover medical cannabis, rather than shelling out for pricier chronic pain drugs such as opiates.
“From a dollars and cents standpoint, if marijuana is the same thing as a narcotic opiate, they would much rather cover marijuana because they’re in the business to make money,” Malik said.