Cannabis licensed producers (LP) are growing in size and scope as Canada moves toward legalizing recreational marijuana. Some are grasping for unique footholds that set them apart from the rest of the field.
The most obvious move in the lead-up to adult-use cannabis legalization might be the push for medical marijuana patents. Instead, LP MedReleaf is taking a different route by announcing plans to issue its products with identification numbers. This would help make it possible for health insurance companies to cover medical marijuana products. Insurers have long said that without Drug Identification Numbers (DIN) it wouldn’t be feasible for them to add cannabis products to their coverage plans.
The Medical Marijuana Benefits Announcement That No One Heard
Earlier this year, MedReleaf was involved in one of the most significant LP consolidations the industry has seen so far—when they were bought out by Edmonton-based Aurora Cannabis. With this $3.2 billion acquisition, Aurora became the largest cannabis company in Canada, representing a combined market capitalization of $7 billion.
While the move put a twinkle in the eye of investors, it nearly eclipsed the news that MedReleaf, an LP known for its high-quality products and medical focus, would be giving 57 medical marijuana products identification numbers. The move was made to facilitate cannabis coverage in employer-sponsored benefits plans.
How MedReleaf Cannabis Product ID Numbers Work
Product identification numbers also called "pseudo-DINs" are similar to traditional DINs. They’re designed to make it easier for employers and other private payers to classify and incorporate pharmaceutical and health-care products into benefits plans. Robert Gora, general manager, medical for MedReleaf prefers calling them product identification numbers (PIN), a name that the industry is used to, though the LP is the first to use them on cannabis.
Diabetes test strips are a prime example of products that carry a number identifier other than a DIN for the purpose of insurance coverage. Robert says that MedReleaf has been asked by a few insurance companies about the PIN, saying that they might not integrate them into their system. “Might not” isn’t a “definitely not,” so there’s a chance insurers would add cannabis products with PINs to their plans.
"At the end of the day, we wanted to make sure [the lack of PINs] didn't continue to be a barrier, and that we're facilitating access and coverage for patients as best we can," he added.
Why Medicinal Cannabis Patients Need ID Numbers on Their Products
When it comes to medical cannabis, the use of PINs could help insurance companies add coverage to specific plans and track the use of MedReleaf products by patient. Two of the largest insurers in Canada, Green Shield and Sun Life, have already gone public with their plans to cover medical marijuana under their extended plans; the Arthritis Society and Shoppers Drug Mart have also shown interest.
And since companies are taking it upon themselves to cover medical cannabis for their employees under self-funded plans, it makes sense for a medical-focused company like MedReleaf to pave the way for health spending accounts and extended health benefits plans to include their products.
Without PINs, MedReleaf's breakthrough medicines would be hard to incorporate and track within a benefits programs. In the past, the lack of identifying numbers for cannabis products was enough to initially deny claimants coverage in the cases of Hamilton [City] v. Hamilton Professional Fire Fighters’ Association or Skinner v. Board of Trustees of the Canadian Elevator Industry Welfare Trust Fund. Because the cannabis medicine in question didn’t have DINs, it was argued they weren’t medications under Heath Canada’s definition.
But DINs allow more insurers and employers to list cannabinoid medicines on their forms. So, MedReleaf stands to improve access and coverage for medical marijuana patients across Canada with this move.
How a Top Cannabis Licensed Producer Will Continue to Stand Out
Days before expecting to pass bill C-45, Canadian Senators adopted an amendment suggested by Conservative Sen. Judith Seidman (34 to 28 margin) to aggressively curtail promotional items like branded hats, t-shirts, smartphone cases and other merchandise from cannabis LPs. Those in favour of the amendment clearly remember the marketing techniques used by alcohol and tobacco companies to maximize consumption and profits.
Cannabis companies that can create a unique value proposition, which communicates beyond Health Canada's plain packaging and the "canna-swag" ban could end up the winners of the industry. And a snapback hat is no competition for any LP that can save patients money on their medicine—a strategy that MedReleaf is banking on.
What Health Conditions Might Insurers Approve for Medicinal Cannabis?
Of course, just having a PIN doesn't guarantee that an insurer will cover a cannabis medicine. For those who will, they’re starting with conditions for which we have the best clinical data so far. Although Health Canada mentions many different conditions for which cannabis is an approved medicine, Sun Life, for example, is focusing on:
- Cancer with severe or refractory pain; nausea and vomiting due to cancer treatments
- Multiple sclerosis with neuropathic pain or spasticity
- Rheumatoid arthritis with pain that hasn’t responded to standard therapy
- HIV/AIDS with anorexia or neuropathic pain
- Patients requiring palliative care
Once insurers get a better idea of how these changes to coverage will affect their overall costs, the parameters for coverage could extend past these qualifying conditions.
For those who can’t access coverage through their insurance provider, Robert suggests health spending accounts. "Anyone with a health spending account can gain access to medical cannabis through that," he says. He also advises claiming medical marijuana on taxes to help lower the cost of medical cannabis.
Hopefully, in the near future medical marijuana patients won’t have make alternate plans to have their medical marijuana covered. Only time will tell if the health insurance industry as a whole gets on board with medicinal cannabis.
Photo credit: Mark