January 23, 2022

German cannabis flower market contracts in the third quarter

December 11, 2020

Conor O’Brien


The National Association of Compulsory Health Insurance Funds (GKV), whose members insure 90% of the German population, has released data on reimbursed medical cannabis consumption in Germany for the third quarter of 2020.

Continuing the trend observed in the first half of the year, the industry’s quarter-over-quarter revenue growth has stalled. This is undoubtedly due in part to new price agreements between the German Pharmacists Association and GKV, which have contributed to a drop in the retail price of cannabis products.

Source: Prohibition Partners / GKV Gamsi

The third quarter saw contractions in the floral products category and increases in sales of full-spectrum extracts. Products made from pharmacy flowers were down 25% in Q3 compared to the first two quarters average, with raw flowers down 8%.

Full-spectrum extracts, on the other hand, saw their sales increase by 14% over the same period. This trend reflects events in mature markets like Canada, where there is an increasing shift from flowers to oils. There may also be an influence of COVID-19 at play, where medical cannabis users in the United States, for example, have shown a tendency to switch from smoking to consuming oils or edibles as a precaution. .

Overall, the industry grew by around 15% year on year compared to the third quarter of 2019. This is a strong sign that access to medical cannabis is increasing, but on a longer timescale than in North American markets. The penetration of medical cannabis in Germany is around 0.15%, while it is over 1% in the United States, and up to 8% in some states. Part of the slowdown in growth in the third quarter can also be attributed to a seasonal decline in sales also seen in 2019.

As Prohibition Partners previously reported, it is not a lack of patients in the country that is holding back growth, but a lack of progress on the part of politicians and the health insurance industry. While medical cannabis is still new to most doctors in Germany, the vast majority are in favor of opening up medical access to the substance. The practices of insurance companies are expected to hold back some of future growth.

Legal health funds reject 38% of patient reimbursement requests, limiting the ability of doctors to prescribe to their patients. This could be addressed in the future by making medical cannabis insurance legislation less ambiguous and making prescribed cannabis insurance mandatory for legal insurers.

Despite these new data, an increase in sales is to be expected in the coming quarters and years. This comes against the backdrop of a growing trend towards liberalizing access to cannabis globally.

Recently, we reported on the UN reclassification of cannabis to a less dangerous category under the Single Convention on Narcotic Drugs. This progress is reflected in events such as the recognition by the EU that CBD is not a narcotic substance and the progress towards full medical legalization in Switzerland.

For a deep dive into the understanding of German medical cannabis and CBD users, see the report from Prohibition Partner German: the CBD and Cannabis Consumer. For consumer data and tailored strategic support, contact the Prohibition Partners advisory team at [email protected]