The Future of CBD in Japan: How Legal Reforms Will Shape the Market


Late last year, Japan made a major step towards cannabis reform after approving a bill to amend its 75-year-old Cannabis Control Act.

After passing the bill in November, the Japanese authorities are now ironing out the details of these reforms, with the industry poised for an announcement from the Ministry of Health, Labour and Welfare (MHLW) which is expected to lay out new standards for THC levels later this month.

This public comment is set to come ahead of a final official decision on the new framework for the country’s already growing hemp and CBD industry in the summer.

Dr Yuji Masataka, MD, Japan’s first specialist in medical cannabis, tells Business of Cannabis: “Considering the upcoming legal reforms scheduled for this summer in Japan, the impact on the CBD market is expected to be significant.”

What is expected to change?

Japan already has an established and thriving CBD market, with more than 150 companies throughout the country currently thought to be importing, manufacturing, or distributing a range of CBD products.

Despite this, heavy restrictions remain on the products that can be bought and sold. This includes a stipulation that CBD and other hemp-derived products have zero observable levels of THC, meaning the market is dominated by isolate CBD products.

This is anticipated to be a key change in the upcoming legislation. According to a statement from the MHLW in February 2024: “In order to prevent the occurrence of health and hygiene hazards, a maximum residue limit for THC remaining in trace amounts in cannabis grass-derived products shall be established.”

Furthermore, according to Dr Masataka, current restrictions that mean only CBD products derived from the stems and seeds of the plant are allowed to be imported ‘will be eliminated’.

“It is expected that the standard will be published this summer, and it is said that the standard (THC) value for final products will be around 0.02%,” they continued.

Market opportunities

According to Dr Masataka, there is frequent debate about whether CBD distribution as a food will be allowed after CBD is approved as a prescription drug. Currently, MHLW does not appear to have any intention of regulating CBD as a food, though future high-profile issues could trigger new discussions about regulation.

Should the legal reforms result in the relaxation of regulations, it is expected not only that consumer confidence will improve, but also that several key changes are likely to occur in the market.

In contrast to Europe, which has novel food regulations, if Japan continues to permit CBD and other cannabinoids such as CBG and CBN food product sales in retail stores following the announcement of new THC regulations, it could set a unique market position.

This would significantly diversify the market, seeing new products such as ‘CBD-infused foods, beverages, and even cosmetics’ enter the market, which Dr Masataka expects will see a ‘rapid increase in demand’ due to destigmatisation and legal clarity.

Publicly listed companies may also begin to enter the sector, ‘seeking to capitalise on the growing demand and potential profitability’, in turn leading to ‘increased investment, more extensive distribution networks, and heightened competition within the industry’.

“Due to these changes, prices of domestic CBD products are expected to decrease. This will be positive for the expansion of the CBD market.”

Japan’s preference for CBD products differs significantly from that of Europe and the US. Various cannabinoid-infused vape products are highly popular in Japan, given the country’s prohibition on flowers containing not only THC but also CBD. This tendency may increase as the Japanese government sets to establish new penalties for the use of cannabis. (Currently, possession is illegal, but use is not.)

The new law is also set to allow for the use of prescription drugs derived from cannabis by categorising cannabis alongside opioids and other narcotics, potentially opening the door for a medical cannabis industry beyond pharmaceutical drugs such as Epidyolex.

It would also be possible for CBD to enter the medical field, with the new regulations seeking to promote research, among other initiatives aimed at opening up the market.

Elsewhere, the new law will look to differentiate cultivation licences for higher-THC medical cannabis, and hemp.

The latter is culturally significant in the country, and laws are expected to be relaxed in order to promote domestic cultivation and Japan’s hemp industry.

While the amendment is set to promote domestic cultivation and theoretically allow for the manufacture of CBD products in Japan, Dr Masataka believes the import market will continue to thrive.

“Unfortunately, I believe that it is not profitable to grow hemp, extract CBD, and commercialise CBD products in Japan.”

While the industry awaits clarification on the details of Japan’s new cannabis framework, the commitment to reform, from what has historically been one of the most conservative countries in regard to cannabis, sends a clear message to the region. Cannabis presents opportunities both medically and economically if regulation allows it to flourish.


Dr Yuji Masataka, MD, is a graduate of the Faculty of Medicine, Kumamoto University. After meeting medical cannabis specialist Dr Jeffrey Hergenrather in California in 2016, he decided to become Japan’s first specialist in medical cannabis. In 2017, while working in the Department of Neurology at Kumamoto University, he, as Representative Director, established the nonprofit organisation Green Zone Japan, which aims to raise awareness about medical cannabis. Currently, he also holds the position of Vice Chairman at the Japanese Society of Clinical Cannabinoid Research.

Dr Masataka also will act as a Key Opinion Leader for Astrasana Japan Co. Ltd., providing support to create a progressive and inclusive landscape in Japan, where CBD products are not only widely accepted but also celebrated for their potential health benefits and recognised as a valuable market opportunity.


Source link

Leave a Comment

Your email address will not be published. Required fields are marked *

Scroll to Top