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COWEN COLLABORATIVE INSIGHTS February 25, 2019 beverages) will be imperative. This regulatory framework does not affect skincare, cosmetics or topicals with CBD or hemp ingredients. 2 Europe UK The UK legalized prescription based medical cannabis in November 2018. Medical cannabis treatments that are advertised with specific medical claims must obtain authorization from the Medicines and Healthcare Regulatory Agency (MHRA). Currently, licensed medical cannabis products are Sativex, Dronabinol and Nabilone. Epidiolex, medical grade pure CBD produced by British pharmaceutical company, GW Pharmaceuticals, is undergoing the licensing process. “Unlicensed” products may be able to be obtained, such as products from Tilray or Bedrocan, under special circumstances which are unmet by other licensed products. Canopy and Aurora announced at the beginning of 2019 that it plans to export to the UK later this year. Despite changes in legality, the number of patients who have been prescribed medical cannabis treatments is quite limited. While pharmaceutical grade products are difficult to obtain, CBD products are widely available across the UK. Pure CBD is not a controlled substance under the Misuse of Drugs Act 1971. Therefore, as long as CBD products are not authorized by the MHRA, medical claims on labeling and packaging cannot be made. There are also no enforced regulations for testing or packaging. These loopholes in the legislation have led to an increasing number of CBD products marketed as health supplements or wellness products. Due to the growing trend, CBD products have been widely available across the UK, primarily sold in boutique shops, cafes, health stores and online. Holland and Barrett, a health foods store, was the first High Street store to carry CBD products in 2017. Other mainstream outlets now sell hemp-based beauty products, CBD tinctures, edibles, vapes, e-liquids and other forms of the substance. A handful of restaurants also offer CBD cocktails or hot drinks, and the number of kitchens and chefs using cannabis- based products is increasing across the country. However, in January 2019, the UK Food Standards Agency (FSA) announced that it plans to conduct an investigation of CBD products for consumer safety. It is expected that the FSA will later provide requirements for authorization. This may take up to 18 months. Although enforcement is unclear at the moment, some CBD products have already been removed from the shelves. Since the FSA’s assessment does not apply to cosmetics or skincare products with CBD, some CBD companies have expressed interest in launching beauty products now. A license is required in order to cultivate hemp in the UK. There are restrictions on where the farm can be located that must be approved by the Home Office. Many companies still struggle to secure banking and payment options for their hemp-related businesses. A lobbying group, the British Hemp Association, was formed to educate and push for legislative changes, such as whole plant processing and financial support. Due to barriers of entry, the number of hemp farmlands is small, around 810 hectares. Italy Medical cannabis has been legal in Italy since 2013, yet access and supply remained restricted for years. In 2017, the Military Chemical and Pharmaceutical Plant (MCPP) received a license to cultivate medical cannabis, which supplemented the imported supply from the Netherlands (i.e. from Bedrocan). The MCPP cultivates a medical cannabis product, FM2, that contains 5-8% THC and 7.5-12% CBD. A high THC product (FM1) and a CBD product (FMO) will soon be available. The MCPP only produces 100-150 COWEN.COM 81 HOUSE_OVERSIGHT_024897