Cannabis Law Journal – Interview With Dr. Atthachai Homhuan
Dr. Atthachai Homhuan is firm manager, regulatory affairs, at Bangkok based law firm Tilleke & Gibbins.
Atthachai assists chemical, life sciences, pharmaceutical, and biotechnology companies to draft and review their patent claims and specifications. He also advises patent agents on amending claims and providing responses to office actions.
. His practice also includes advising on pre-litigation and litigation matters involving the life sciences, medical devices, and pharmaceuticals. He has presented before the IP&IT Court as a witness in chemistry and life sciences patent litigation.
Could you please give us by way of introduction some information about yourself the cannabis practice and Tilleke & Gibbins law firm?
Tilleke & Gibbins has been at the forefront of the developing medical cannabis industry in Thailand since cannabis’s partial legalization for medical purposes in Thailand, February 2019, following involvement in the consultation stages of that legislation and building on decades of strong relationships with the key stakeholders in government, medical practice, business, and academia.
Their ability to adapt to the changing legal environment and anticipate regulatory updates allows us to provide ongoing technical services and strategic advice to cannabis companies in all stages of development, and ensure that they are designed to prosper in any circumstance.
The firm advises clients involved in various activities in the hemp and medical cannabis industries, from application and licensing in relation to cultivation, extraction of cannabinoids, cannabis and hemp oils, and permitted industrial, nutraceutical, cosmetics, traditional medicine, and pharmaceutical applications, to production of CBD and cannabinoid-infused nutraceutical and F&B products for sale in domestic and international markets.
How long has the firm been working on regulated cannabis matters and questions?
We have been working with regulated cannabis issues since January 2018, when the Ministry of Public Health deregulated industrial hemp. The firm has advised Thai companies on hemp cultivation and applications of hemp in various industries (such as apparel, household products, furniture, and more).
Following the legalization of cannabis for medical purposes in 2019, we have been actively supporting Thai and multinational companies in in medical and related fields.
Let’s start with Medical Cannabis regulation in Thailand. Can you give us some background on the development of the regulation, how it is being managed and where we are as of late 2020?
The Narcotics Act 1979, as amended, classifies narcotic substances into five categories, with category 1 for dangerous narcotics without the medical benefit and other categories including substances with lower propensity for causing drug addiction and some level of medical application.
Cannabis (both Cannabis indica and Cannabis sativa) is classified as a category 5 narcotic, which means it has promising potential for medical applications. Nonetheless, for forty years (1979–2019), cannabis was banned in Thailand.
In 2018, the Ministry of Public Health and the Office of the Narcotics Control Board became key regulatory authorities in Thailand promoting the medical potential of cannabis.
Then in February 2019, the National Legislative Assembly passed the amended Narcotics Act No. 7 (2019), which officially permits cannabis for medical use. Since 2019 there have been many further developments in cannabis regulations.
More importantly, the Ministry of Public Health announced an amnesty period, during which patients possessing cannabis for their medical use could declare their possession to the Thai Food and Drug Administration. This not only gave them an exemption from criminal punishment, but also allowed them to register for using medical cannabis developed by the Government Pharmaceutical Organization.
Industrial hemp legislation – does that exist for purposes outside medicine in Thailand and if so what is currently the state of play of the regulations in terms of growers, processing and export?
Actually the legislation addressing hemp for industrial purpose has been in effect since January 2018, before the legalization of medical cannabis. But its application has been limited to industrial purposes (such as in clothes, furniture, and so on) as well as for household cooking.
Following the enactment of Narcotics Act No. 7, hemp (Cannabis sativa) has gained attention from the cannabis industry since hemp contains a lower level of THC and all parts of hemp can be applied in various industries.
Currently, the hemp legislation from 2018 allows Thai state agencies to engage in production of hemp for industrial purposes and for research and development.
However, draft legislation (likely to be enacted in 2021) will allow private businesses to be licensed for production and commercialization of hemp and hemp products. The hemp industry is looking forward to the implementation of the draft legislation.
Adult use (recreational) cannabis – Are there any discussions underway at government level with regard to both decriminalisation and legalisation for Thai citizens at the moment? If so will the same rules and regulations apply to foreigners in Thailand?
The adult use of cannabis is still illegal in Thailand. Although several political parties have proposed the recreational use of cannabis, this issue is still debated in Thailand, including among both regulatory authorities and the academic community. The Narcotics Act 1979, as amended, and its bylaws also apply to foreigners residing in Thailand.
CBD – what is the status of CBD and CBD products in Thailand at the moment?
One milestone of the cannabis legalization movement has been the status of the CBD and CBD-derived products in Thailand.
The Ministry of Public Health issued a notification on August 31, 2019, that carved modern drugs, herbal products, cosmetics, and food containing cannabis or a certain amount of CBD out of scope of the Narcotic Act. Products containing CBD as an active ingredient, with THC less than or equal to 0.2%, are not classified as narcotics.
Control measures for CBD products in Thailand are under product-specific laws such as the Drug Act, Herbal Products Act, and so on.
Going back to Medical Cannabis. Currently we are aware of legislation that has been written to allow Thai research institutions to grow and create products from cannabis. Can you give us more detail and provide a bit of background to the position of Thai private companies outside the research sphere being allowed to develop medical cannabis products?
Currently, the draft ministerial regulations on applying for and obtaining licenses in relation to medical cannabis are not yet in place, so medical cannabis activities are currently allowed only for the government or state agencies.
Thai private companies must pay serious attention to section 26/5 of Narcotic Act No. 7, which prescribes that at least two-thirds of the directors, partners, or shareholders of a company applying for a license (such as for cultivation, possession, or distribution, for example) must be Thai, and the registered office must be in Thailand.
Apart from the research sphere, the Thai industry is now waiting for the enactment of the draft ministerial notifications regarding application filing and license issuance covering the life cycle of medical cannabis products (including import, export, production, distribution, and possession).
Foreign Investment in Thai medical cannabis companies
A recent report in the Thai media said that legislation now allowed for foreigner ownership up to 30% in Thai cannabis ventures. Is this correct ? Can you provide more details on JV’s investments & foreign ownership in Thai medicinal companies?
As mentioned in the answer to the previous question, at least two-thirds of the company’s directors, partners or shareholders must be Thais.
The exact licensing rules and procedures for private companies will be implemented by the now-pending ministerial regulation, which is likely to come in 2021.
As a safeguard measure, however, this requirement can be interpreted as meaning that foreign ownership must not be over 33%.
Parties to cannabis-related joint venture investments and Thai companies with partial foreign ownership should therefore closely monitor how the regulatory authority will construe the shareholders requirement prescribed in Narcotics Act No.7.
Generally, what are the rules on export of Thai Medicinal Cannabis products to other jurisdictions? Currently?
The licensing rules and procedures for exporting the cannabis products from Thailand will be implemented by the now-pending Ministerial Regulation, which is likely to be implemented in 2021.
Since some cannabis products are delisted from the narcotic substances, the export of the cannabis products must comply with the relevant laws e.g. Drug Act, Herbal Product Act and the law of importing countries.
Are foreign companies allowed to export their medicinal cannabis and / or CBD products to Thailand?
So far a license for import of cannabis seeds and medical cannabis products has only been granted to state agencies (such as the Government Pharmaceutical Organization and public hospitals).
Without authorization from the Ministry of Public Health, foreign companies are not allowed to export the products to Thailand.
Do you expect to see further legislation by the government in 2021 on cannabis / hemp & CBD products. If so where to you see the most likely developments?
Yes. Most likely, legislation on the issuing of the hemp license will be announced in 2021.
The government has promoted hemp and its industrial applications, including for food, drugs, cosmetics, herbal products, and hemp fiber.
Currently how do Thai medical cannabis patients access medical cannabis – by prescription only?
What are the processes?
Currently, only qualified medical practitioners working at the government hospitals, who work at government hospitals and pass medical cannabis training and examination can prescribe medical cannabis to patients.
About 30 public hospitals have opened a cannabis clinic to provide patients with access to medical cannabis.
Has legislation been formulated on the issues of sale / provision to the general public? (e.g. packaging, marketing, taxation etc.)
There is already legislation on label and package insert of medical cannabis. A draft ministerial regulation on the advertisement of medical cannabis is currently being prepared, and so far there is no specific provision on the taxation of medical cannabis.
Currently what is the approach of the government in terms of building a cannabis business sector?
Can you give indication what the Thai sector might look like by 2022?
For example should we expect a fully integrated Thai medical cannabis medical market for domestic use/ consumption with an export market?
In terms of building a cannabis business sector, we expect step-by-step growth of a cannabis market for domestic consumption. Subsequently, an export market is expected to develop.
At Tilleke & Gibbins how do you see Thai cannabis legislation and market compared to neighboring countries Malaysia, Myanmar, Laos, Cambodia & Vietnam? Do you see any regulation of the sector in any of these countries and especially so the bigger black market cannabis producers Myanmar, Laos & Cambodia?
Thailand is the forerunner in cannabis legislation, and the market demand is extensive compared to neighboring countries.
Among the CLMV countries, as far as we know, only the government of Laos is considering draft legislation on cannabis for medical purposes.
Has there been any discussion as yet of regulation processing, testing and standards – Is that being managed by Central Government or specially created bodies?
Yes. The Thai Food and Drug Administration has published guidelines on the premises for cultivation and their oversight, THC testing by government laboratories (Department of Medical Sciences) and other accredited laboratories with ISO 17025 certificates. In addition, in 2020 the Bureau of Drugs and Narcotics of the Department of Medical Sciences published a pharmaceutical monograph on cannabis sublingual drops and cannabis extracts that contains detailed instructions for identification, purity tests, and other specific tests to limit the amount of undesirable impurities. This pharmaceutical monograph is an attempt to assemble testing standards for cannabis products.
Looking over the past 12 months which countries appear to be interested most in investing in the Thai medicinal & industrial hemp sector? (e.g., USA? Canada? UK? Australia? NZ. ? …….China?)
Investors from the USA and Canada have shown the most interest in getting involved in the cannabis industry in Thailand.
With regard to Tilleke & Gibbins would you like to give us more detail about your cannabis sector skills, the team and what matters, legislation etc. that the firm may have worked on in 2019 / 2020?
Tilleke & Gibbins paves the way for cannabis clients to enter and excel in markets not only in Thailand, but also in Southeast Asia.
We assist with everything a cannabis company might be interested in, including research and development and clinical trials, registration and market entry, commercialization and technology transfer, and many other areas. As we are always among the first to know of shifts and developments in government policies or regulations, we keep our clients informed and up to date, and can step in, build coalitions, and build connections with the relevant authorities as needed.
Our varied work in the developing cannabis industry is led by experienced attorneys and specialized practitioners, who include pharmacists, scientists, and agricultural consultants.
Some of the specific work we’ve done recently includes setting up joint ventures, arranging for technology transfers, and arranging other types of connections with Thai partners for the research, development, and manufacture of medical cannabis and CBD products. We have also advised clients on patents and other IP protections for cannabis-related products.
How is it best for people from overseas to contact the practice with regard to cannabis enquiries?
Investors and others interested in our services regarding the Thai cannabis industry can contact us via email [email protected]
We also publish updates on the status of the Thai cannabis industry in Thailand and Southeast Asia on our website (www.tilleke.com), in publications like the Canabis Law Journal, and on LinkedIn.
Is there anything else you would like to add about the regulated cannabis sector moving forward both in Thailand and throughout the region?
The development of Thailand’s legislation on cannabis showcases the exceptional potential of medical cannabis. Also, now Thai legislation on cannabis has further expanded to food, herbal products, and cosmetics.
Thailand’s ultimate goal in this is to become one of the world’s top players in the trade of medical cannabis and related products.
An understanding of cannabis legislation and where it’s headed is the most essential element contributing to success in the various cannabis industries.
As a full-service law firm with deep expertise in life sciences and regulatory affairs, Tilleke & Gibbins is very well positioned assist businesses in these matters.
With our presence in other ASEAN countries, including Cambodia, Indonesia, Laos, Myanmar, and Vietnam, we provide the full range of advice on the cannabis regulatory landscape to support our clients’ success in Southeast Asia.
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