Big Pharma Set to Take Over Medical Marijuana Market

Meanwhile, state-licensed medical marijuana dispensaries that provide relief for thousands of Americans are under attack by other federal agencies.

April 21, 2011  |  

 

 

Just as the federal government is clamping down on medical marijuana dispensaries, the Federal Drug Administration (FDA) may be set to give Big Pharma the clearance to take over the market.

In 2007, GW Pharmaceuticals announced that it partnered with Otsuka to bring "Sativex" -- or liquefied marijuana -- to the U.S. The companies recently completed Phase II efficacy and safety trials testing and began discussion with the FDA for Phase III testing. Phase III is generally thought to be the final step before the drug can be marketed in the U.S.

"GW Pharmaceuticals plc (AIM: GWP) today announces the initiation of the Phase III clinical trials programme of Sativex in the treatment of pain in patients with advanced cancer, who experience inadequate analgesia during optimized chronic opioid therapy," GW said in a statement. "This indication represents the initial target indication for Sativex in the United States."

Sativex is the brand name for a drug derived from cannabis sativa. It's an extract from the whole plant cannabis, not a synthetic compound. Even GW defines the drug (.pdf) as marijuana.

Yet as the FDA is poised to approve the drug for Big Pharma, state-licensed medical marijuana dispensaries that provide relief for thousands of Americans are under attack by other federal agencies.

Lynette Shaw, the owner and founder of Marin Alliance for Medical Marijuana (MAMM) in Fairfax, California, was stunned when the IRS audited her 2008 and 2009 tax returns and disallowed the foundation's business deductions, then demanded millions of dollars in back taxes.

The IRS pursued her under § 280E of the federal tax code, which states that no business deductions will be allowed for companies "trafficking in controlled substances".

Shaw is now suing the IRS to prevent them from destroying the entire medical marijuana industry.

Last week, the Justice Department even threatened to prosecute state employees who license medical marijuana dispensaries.

As a result, Washington state Gov. Chris Gregoire (D) said she would veto a bill that would have allowed the state to license growers.

In February, marijuana advocacy group NORML warned that the Drug Enforcement Administration (DEA) intended to legalize marijuana for Big Pharma only.

"The DEA's intent is to expand the federal government's schedule III listing to include pharmaceutical products containing naturally derived formations of THC while simultaneously maintain existing criminal prohibitions on the plant itself," Paul Armentano, the deputy director of the National Organization for the Reform of Marijuana Laws (NORML), wrote at AlterNet.