The FINANCIAL -- Verdict: FactCheck concludes that Ivane Machavariani’s statement is TRUE.
Resume: In August 2019, Global Market Insights published a research study on the size of the medical marijuana market. The research study analyses markets in terms of the type of medical cannabis,1 the ways of consumption and the methods for its distribution. It is also noted that the increase in the number of scientific studies about medical cannabis as well as the growing number of countries which have legalized marijuana for medical purposes and the ever-expanding amount of medications based on medical marijuana in the last years will result in a sharply increased market demand for medical cannabis in the future.
In accordance with the research’s estimates, the size of the medical marijuana market exceeded USD 7 billion as of 2017 and is expected to have a 36% cumulative annual growth rate (CAGR) in the period of 2018-2024. As a result, the size of the medical marijuana market will exceed USD 55 billion.
On 16 September 2018, on air on TV Imedi, the Minister of Finance of Georgia, Ivane Machavariani, stated: “The production of medical marijuana is increasing annually and there will be a cannabis market of USD 25 billion by 2024-2025.”
On 13 September 2018, the Government of Georgia submitted a bill to the Parliament of Georgia which envisioned the establishment of a legal ground for planting, growing, cultivating and producing the cannabis plant for medical or/and industrial purposes. However, a discussion on the bill at the Parliament was stopped following a public backlash. Currently, it is unknown whether or not this discussion will be continued.
In August 2018, Global Markets Insight published a research study on the size of the medical marijuana market. The research study analyses the markets in terms of the type of medical cannabis (its use for the treatment of certain diseases), the ways of consumption (inhalation, oral, topical) and the methods for its distribution (dispensers, online). The research study also offers a report on industry analysis, regional perspectives, price trends and a competitive market share and prognosis for 2018-2024. In the study, its authors offer an analysis of industry trends and note that the size of the medical marijuana market was estimated to be over USD 7 billion as of 2017 and is expected to have a 36% cumulative annual growth rate (CAGR) in the period of 2018-2024.
The research estimates are based on the taking into account and analysing of two factors – those contributing to the growth of the market and those possibly impeding its expansion. Of the factors contributing to the growth of the marijuana market are: a growing demand for medical marijuana for the treatment of different diseases, a demand for the legalisation of medical cannabis in different countries of the world and the increasing number of clinical research studies on using marijuana for medical purposes. The factors possibly impeding the development of the medical marijuana industry are: side effects (dizziness, increased heartbeat, sleepiness) of medications based on cannabis which might hamper market growth as well as difficulties associated with medical marijuana business banking (business loans and cooperation with loan issuing institutions).
Graph 1: Medical Cannabis Market Size, 2013-2014
Source: Global Market Insights
Currently, nearly 75% of medical marijuana medications are used to relieve chronic pain. In accordance with the existing scholarship, one out of ten people are diagnosed with painful chronic ailments annually. This is precisely what has contributed to the growth of the market demand for marijuana for medical purposes. Researchers assume that the market demand for medical cannabis will increase in light of the growth of neuropathic diseases. In addition, a 37.4% growth in the use of medical cannabis to treat skin diseases (psoriasis and eczema) is expected.
As of 2017, the inhalation segment of the medical marijuana market was assessed at USD 5,330 million based on different sources. Researchers believe that the different advantages of inhalation, such as an easily controlled dosage and the effective absorption of cannabinoids in the body, will only increase the demand for inhaled marijuana. In addition, a 37.2% compound annual growth rate in medical marijuana-based products designated for local consumption (ointments, lotions, gels and poultices which are used for the treatment of skin inflammation) is expected in the period of 2018-2024. As of today, the global medical cannabis market is dominated by the ten largest companies in the world. Some of them merge or expand their cooperation in order to increase their geographic access area, product portfolio and market share. The aforementioned research study notes that the medical cannabis industry is still in the development stage and has yet to undergo an important phase of progress.
The USA and Europe are largest regions for the medical marijuana market.
As a result of detailed market analysis, the compound annual growth rate (CAGR) constitutes 36% and the value of the medical marijuana market will surpass USD 55 billion by 2024 according to the final estimates of the research study.