February 27, 2024  ⦿  

Covering Cannabis Culture & Business Since 2006

Shoppers Drug Mart, a major Canadian pharmacy, stops carrying medicinal cannabis

Shoppers Drug Mart, a major Canadian pharmacy chain, is leaving the cannabis business by selling its four-year-old medicinal cannabis distribution business to another business.

The largest grocery chain in Canada, Loblaw Cos., subsidiary Shoppers, announced on Tuesday that it was “transitioning” its Medical Cannabis by Shoppers segment to biopharmaceutical operator Avicanna.

The deal’s financial details weren’t made public.

In January 2019, Shoppers started their MMJ marketing company.

In a press release, Shoppers President Jeff Leger stated, “As we move away from medical cannabis distribution, we stay firm in our conviction that this medication should be dispensed in pharmacies like all others and will continue our advocacy to that end.

The reason Shoppers chose to end its medical cannabis operations was not made clear in the release.

Loblaw was questioned by Tomorrow420 about the rationale for the change.

The public affairs department of Loblaw responded, saying that “medical cannabis is the only medication that is not dispensed in pharmacy.”

As a chain of pharmacies, we’re dedicated to helping patients and concentrating on our core activities because that’s where we can have the biggest effect.

Although Shoppers has nearly 1,350 sites across Canada, selling medical marijuana out of those physical stores has never been permitted.

Canada’s nationally controlled medical cannabis program is based on mail-order sales to licensed patients, and Shoppers provides its MMJ customers with an online platform to make this process easier.

Instead of growing cannabis, consumers signed supply agreements with producers.

In recent financial filings, parent firm Loblaw did not disclose the value of Shoppers’ medical marijuana business.

Mitchell Osak, head of Toronto-based Quanta Consulting, a consulting firm for the cannabis industry, did not find it surprising that consumers were leaving the industry.

Osak asserts that Shoppers‘ medical marijuana company was “floundering” in light of the general decline in the regulated MMJ market in Canada, both in terms of revenue and patients.

As he explained to Tomorrow420, “I believe there was a hope when (Shoppers) got into the medical cannabis industry in 2019 that they would be able to influence the government or that the government would change the regulations, which would allow medical cannabis to be prescribed in their pharmacies, by pharmacists.

“That never took place.”

Osak continued, pointing out that the firm was engaged in medical cannabis research, that Shoppers’ decision to leave the cannabis business “is a blow to the credibility of the industry.”

They were significant players in the medical marijuana business, and their departure obviously hurts the entire sector.

The Canadian medical cannabis industry has shrunk as the legal adult-use market has expanded.

Health Canada stated that as of March 2022, there were 247,548 registered users of medical cannabis, down from a peak of 377,024 in September 2020. (Patients can be registered with more than one MMJ provider.)

While this is going on, some licensed producers have shifted their attention back to medical cannabis as a market with higher margins than adult-use marijuana, paying close attention to patients whose MMJ expenses are covered by employee health benefits programs.


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