Federal cannabis legalization might reduce conventional pharmaceutical sales by billions of dollars according to a new study conducted by researchers from California Polytechnic State University and the University of New Mexico.

The study, titled “U.S. Cannabis Laws Projected to Cost Generic and Brand Pharmaceutical Firms Billion,” examined the performance of publicly traded pharmaceutical companies after medical or recreational legalization actions.

What’s more, the results revealed these reductions caused billions of losses in annual sales. 

While other studies have revealed how marijuana access lowers the use of certain drugs such as opioids or has reduced its use among certain patient populations, such as Medicaid patients, this is said to be the first study of its kind to examine the comprehensive impact of marijuana on pharmaceutical companies across all products and types of patients. 

Why is the impact of one plant so overwhelming?

Cannabis Versus Standard Drugs – Incomparable

On top of that is the price of pharmaceutical drugs, which often poses a struggle for many Americans and creates a financial strain on the federal government. That is why many see marijuana as a great way to boost the economy and deal with the opioid epidemic, among other benefits.

According to the authors of the study, full federal cannabis legalization could result in an 11% reduction in sales of conventional pharmaceutical drugs. 

The authors also noted that adult-use legalization had more than twice the impact of medical legalization, and that branded drug producers were more affected than generic producers. They concluded that pharmaceutical companies could benefit more from investing in the marijuana market, instead of advocating against it.

Pharma Giant Advocating Against Cannabis 

While it is nothing new to say that the pharma industry wouldn’t like to see cannabis legal for its gains, it is quite shocking to see the figures from the study that reveals how huge an impact legalization would have.

Pharma companies are known to lobby against marijuana. Just recently, the Community Anti-Drug Coalitions of America (CADCA), which is fighting against federal cannabis legalization, removed a page from its website disclosing its partners, among which was pharma giant Pfizer Inc. (NYSE:PFE). 

While one might argue that Pfizer is not involved in the plant-touching aspect of marijuana but rather searching for drugs that target cannabinoid receptors, the argument actually supports the suggestion that the pharmaceutical giant would like to dominate this field as well, in that cannabis has many compounds that affect our cannabinoid receptors.

Photo: Berk Ozel and IRA_EVVA and Anneleven Stock by Shutterstock