Recreational Cannabis vs. Medical Cannabis Sales in Canada

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Kalpna Mistry

Kalpna Mistry

Under the Cannabis Act and Cannabis Regulations, businesses (small and large) can sell cannabis both recreationally and to medical patients in Canada. However, there are different licenses required to perform these two different activities. In this article, we’ll discuss the two licenses, and what they allow your business to do.

Recreational Cannabis Sales – The Processing License

Under the Cannabis Act and Cannabis Regulations, a processing license is required to manufacture and package cannabis-based products (edibles, topicals, and extracts). The two types of processing licenses that are currently available are standard processing (no limit on production amount) and micro-processing (limited to processing 600 kg of dried flower (or the equivalent) to be handled each year).

Both standard and micro-processing licenses allow for the sale and distribution of cannabis products to other license holders or provincial and territorial retailers (i.e., recreational cannabis sales) such as the Ontario Cannabis Store (OCS) in Ontario.

Therefore, if you’re looking to have your cannabis-based products enter the recreational cannabis market, your first step would be obtaining a processing license.

What Happens After Receiving Your Processing License?

Before you can sell your recreational cannabis products, there are two things you need to do after you receive your initial processing license.

1. File a Sales Amendment with Health Canada – Health Canada will initially limit the activities that may be conducted with your processing license (ie. sales to authorized retailers). Therefore, the next step will be to apply for an amendment to the license to get any existing conditions removed. Once that’s done, your business will be permitted to sell cannabis products (such as dried cannabis and/or fresh cannabis, cannabis topicals, cannabis extracts, or cannabis edibles) to provincially and territorially authorized retailers and/or holders of a license for sale for medical purposes.

2. File any applicable Notice of New Cannabis Product (NNCP) – When a new cannabis product is created by your business, a notification must be provided to Health Canada at least 60 calendar days before making that new product available for sale. The notification must include certain documentation based on the class of cannabis product and must be submitted for each new cannabis product. 

Medical Sales – Sale for Medical Purposes License

If you want to sell packaged cannabis products to medical patients, you will need to hold a Sale for Medical Purposes license. This license is available with the possession of cannabis or without possession of cannabis.

A Sale for Medical Cannabis Purposes license with possession allows your business to store packaged medical cannabis products at your facility for sale to medical cannabis patients. Individuals who are authorized by a health care professional can then register with your business to buy cannabis products, which you can ship from your site to the end client.

A Sale for Medical Purposes license without possession allows your business to sell medical cannabis to registered medical cannabis clients, but the cannabis will not be stored at your facility. Rather, when a registered patient places an order with your business, the product will be shipped directly from the licensed producer to your client.

We hope the information above has helped to clarify how your business can sell recreational cannabis and medical cannabis.

Contact us today to discover how we can license and legalize your cannabis business to meet federal or provincial regulations.

How we can help you

At Cannabis License Experts, we provide you with the guidance to plan your cannabis business, acquire funding, navigate the legal requirements, and acquire the appropriate license for your operations. As the Canadian cannabis industry develops, more and more licensed producers will be needed to meet the demands of consumers.

Cannabis License Experts offers support from day one of starting your cannabis business, including strategic planning, floor plan preparation, site audits, SOPs, Preventive Control Plans (PCPs), and more.

Our Edibles Compliance division can provide you with a solid plan for your edibles business to help get your products on store shelves. Give us a call at 1-800-651-6280.