Medical Cannabis Poised to Cannibalize The Pharmaceutical Industry

May 24, 2017

Washington – New Frontier Data, the authority in business intelligence for the cannabis industry, has found that medical cannabis use could take a significant bite out of the pharmaceutical industry if adopted in all 50 states. In our latest study, From Prescription to Recommendation: How Cannabis Could Disrupt the Pharmaceutical Industry, our data analysts have found that if medical cannabis were legalized nationally, pharmaceutical expenditures on the top nine conditions commonly treated by medical cannabis could fall an estimated $18.5 billion between 2016 and 2019.

“The United States constitutes 35% of the global pharmaceutical market, the largest market in the world, and a major driver of the U.S. economy. It is one of many industries that will be impacted by the growth of the legal cannabis market and we are already starting to see that trend in legal medical states where use of key prescription drugs is down by 11%. If cannabis were to be adopted nationally, we would begin to see a trend of patients turning to medical cannabis as a substitute or complement to pharmaceuticals,” said Giadha Aguirre De Carcer, CEO & Founder, New Frontier Data.

New Frontier Data’s analysts looked at chronic pain, post-traumatic stress disorder (PTSD), sleep disorders, anxiety, nerve pain, chemotherapy induced nausea and vomiting (CINV), Tourette syndrome, glaucoma, and seizures/epilepsy, nine of the conditions designated by the National Academies of Science as being most effectively treated by medical cannabis. Based on a 2016 Health Affairs study which found an 11% reduction in drug prescriptions in medical cannabis states, our analysts estimated what the total reduction would be if medical cannabis were fully legal nationally. By applying that decrease to the total amount of money spent in the U.S. on treatments for these conditions, it is estimated that cannabis and related products can replace $4.4 billion to $4.9 billion per year of current spending on existing treatments.

“Looking at these numbers, it would appear that medical cannabis would be a drop in the bucket when it comes to impacting the total pharmaceutical industry. However, when you start to break down the numbers by specific sectors of the industry, like chronic pain or symptoms associated with chemotherapy, which are very lucrative markets for pharmaceutical companies, you will certainly see cannabis have a major impact,” said Aguirre De Carcer.

If you are a reporter and would like a copy of the study, please contact our PR team:

About New Frontier Data:

New Frontier Data is an independent, technology-driven analytics company specializing in the cannabis industry. We offer vetted data, business intelligence and risk management solutions for investors, operators and policymakers. New Frontier’s data and reports have been cited in over 50 countries around the world to inform industry leaders. Founded in 2014, New Frontier Data is headquartered in Washington, D.C. and has an additional office in Denver, CO. For more information or media inquiries, please visit or contact our PR team: