Toward the legalization, regulation and restriction of access to marijuana: Discussion paper – 3.2 Establishing a safe and responsible production system

3.2 Establishing a safe and responsible production system


Important lessons can be learned from Canada's experience with the production of marijuana for medical purposes in terms of establishing a safe and responsible production system. Legal access to marijuana for those with a medical need began in the late 1990s in response to an Ontario court decision. This and a series of subsequent decisions confirmed Canadians' constitutional right to reasonable access to a legal source of supply of marijuana for medical purposes. The program and regulatory framework evolved based on these court decisions.

Three main production models have been used either alone or in combination: home cultivation, government-contracted production, and a competitive market model of licensed producers.

Under the former home cultivation regime, the number of Canadians authorized to consume marijuana rose exponentially to approximately 40,000 from less than 500 over the period 2002 to 2014. As the amount of marijuana authorized grew to an average of 18 grams per day, translating into an average of nearly 90 plants, problems with the regime emerged. Issues included increased risks to the occupants from mould, pesticides, fire and increased risk of home invasion. Neighbours and landlords were also affected, as were local services called upon to deal with issues arising from home grow. It was also virtually impossible for Health Canada inspectors to provide effective oversight of home grow operations for two main reasons: the large number of locations spread across the country, and the inability of inspectors to enter a private residence without either permission from the occupant or a warrant.

Likewise, government-contracted production had significant limitations. Health Canada contracted for the production of a certain amount of marijuana grown to specified quality standards, which was then made available for purchase to medically authorized individuals. Fewer than 10% chose to buy this product. Issues included: a lack of variety of choice of type and strain; and concerns by some about price. In addition, the price paid for the marijuana did not fully cover the cost, resulting in significant taxpayer subsidization.

The current model, the Marihuana for Medical Purposes Regulations (MMPR), is exclusively a regulated competitive model. Under the MMPR, as of June 28, 2016, there were 33 licensed producers, 416 applications in the queue, and approximately 20 new applications being received each month. Moving forward, this type of regime with competitive market forces could be one model for production of marijuana. It has a variety of potential advantages including making available a wide variety of strains at different prices.

In addition to this regulated but largely market-driven competitive model, there are other options that could be explored, some of which would involve greater government management of the market. For example, a competitive auction system where qualified applicants pay for the right to operate could be considered. This approach is similar to how the Government of Canada sells government securities. Another model would require the Government to estimate the size of the market, determine how many producers can serve that market, and issue licenses accordingly (similar to the approach used in Washington State).

Several jurisdictions have legalized marijuana for recreational purposes - including Uruguay and, in the U.S., Colorado, Alaska, Oregon, Washington and the District of Columbia. With the exception of the District of Columbia, these jurisdictions allow for the production of marijuana through licensed commercial growers. In addition, all except for Washington permit individuals to grow their own marijuana. All of these jurisdictions place restrictions on the number of plants that individuals can grow. In the U.S., Colorado, Alaska and the District of Columbia allow their citizens to grow a maximum of six plants. Uruguay also permits the cultivation of up to six plants. Oregon allows its residents to grow four plants.

A key principle for consideration common to all models is whether those growing marijuana should have to pay a licensing fee so that taxpayers are not required to subsidize the full cost of government oversight of the program.

Regardless of the production model selected, a new regulatory framework for legal marijuana could contain features designed to ensure good manufacturing practices in a safe and secure environment. This could help to address both the potential health risks from marijuana as well as the need to ensure that marijuana produced in the legal framework stays in the legal framework. The marijuana could be subject to appropriate testing, packaging and labelling requirements both to protect children and to ensure adult users have the necessary information to make informed choices. The MMPR contain these features and could serve as a reference point for consideration of the nature and extent of the safeguards required in the legal marijuana regime.

Possible Options

  1. Production Model: Experience with both home cultivation and government-controlled production in the context of relatively small numbers of medical users suggests neither approach would be in the public interest in the context of the larger numbers of users expected in a legalized market. Therefore, some form of private sector production with appropriate government licensing and oversight could allow for safe and secure production of legal marijuana with adequate choice (both price and strain) for consumers.
  2. Good production practices: In general, ingestible products must meet certain quality standards. In the medical marijuana regime, Health Canada has established product content and production controls that have proven effective in minimizing risks to clients. Similarly, safeguards could be put in place to ensure that marijuana is produced and stored in sanitary and secure conditions. There could be strict security requirements to minimize the possibility of diversion. Controls could be placed on pesticides that can be used, and on microbial and chemical contaminants. Marijuana could also be subject to analytical testing so that those consuming can be reliably advised of its contents, particularly amounts of THC and CBD.
  3. Product packaging and labelling: The way in which products are packaged and labelled offers an opportunity to minimize the harms of marijuana, particularly for children and youth. Measures to consider implementing include: child-proof packaging to prevent accidental ingestion by children; and, labels on packages to contain both important information about the product (e.g., THC and CBD content) as well as appropriate health warning messages.


  • What are your views on the most appropriate production model? Which production model would best meet consumer demand while ensuring that public health and safety objectives are achievable? What level and type of regulation is needed for producers?
  • To what extent, if any, should home cultivation be allowed in a legalized system? What, if any, government oversight should be put in place?
  • Should a system of licensing or other fees be introduced?
  • The MMPR set out rigorous requirements over the production, packaging, storage and distribution of marijuana. Are these types of requirements appropriate for the new system? Are there features that you would add, or remove?
  • What role, if any, should existing licensed producers under the MMPR have in the new system (either in the interim or the long-term)?

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