The New Opportunities in European Cannabis Market by 2025

The year 2024 will be a dramatic one for the global cannabis industry, witnessing historic progress as well as worrying setbacks in attitude and policy. It is also a year dominated by elections, with approximately half the world's population eligible to vote in national elections across 70 countries. Even for many of the most progressive cannabis industry countries, this means significant shifts in political stance, leading many countries to lean towards harsher measures and, in some cases, policy reversals. Despite over 80% of parties experiencing a decline in vote share, there is reason to be optimistic about the outlook for the cannabis industry in the coming year.

What are the prospects for the European cannabis industry in 2025? Let's hear from the experts.

The positioning of cannabis medicine in the global healthcare system.

Stephen Murphy, CEO of Prohibition Partners, a renowned cannabis industry data institution in Europe, believes that the cannabis industry will accelerate in the next 12 months. He said, "By 2025, the cannabis industry will accelerate its automation across decision-making, operations, marketing, and finance. As more companies achieve positive cash flow, we will see new entrants emerge, willing to take the necessary risks that could catalyze significant policy changes. Next year will be a pivotal moment, with the focus no longer relegated to cannabis itself, but a deeper integration with healthcare. The main growth opportunity lies in positioning cannabis as a core component of the global healthcare system, and we believe this step will redefine the industry's development trajectory."

Prohibition Partners' Senior Analyst notes that the cannabis industry will continue to grow, but not without challenges. Overly bureaucratic approaches in some countries will continue to impede market growth. Balancing accessibility, quality control, and regulation is essential to establishing a sustainable, socially beneficial cannabis framework. As countries learn from each other's successes and failures, development patterns for both medical and adult-use cannabis markets are gradually emerging.

"However, there is still tremendous untapped potential in the global industry, and given sustained progress over the past few years, it seems likely this potential will be unlocked through some pathway."

Germany's landmark reforms will continue to fuel momentum in Europe.

This year, Germany achieved a quasi-legalization of adult-use cannabis. Citizens can use cannabis in designated areas without fear of prosecution, possess cannabis for personal use, and also cultivate cannabis at home for personal consumption. The year 2024 is being hailed as a "historic year" for Germany's cannabis policy, as its broad decriminalization represents a "real paradigm shift" in the country. In addition to the passage of Germany's cannabis law (CanG) in April of this year, cannabis social clubs and private cultivation were also legalized, and just this month, legislation allowing for Swiss-style adult-use cannabis pilot projects was passed. In light of these milestone policy advances, Cannavigia, an active participant in Switzerland and Germany's adult-use cannabis pilot projects, states, "While commercial sales remain restricted, these changes highlight the momentum towards wider legalization in Europe."

Looking ahead, the company believes that "the expansion of Germany's adult-use cannabis pilot projects will provide valuable insights into consumer behavior and regulatory frameworks, paving the way for wider legalization efforts." Philipp Hagenbach, Co-Founder and COO of Cannavigia, added, "Our pilot projects across Europe provide valuable insights into consumer behavior and regulatory requirements. These projects are a key cornerstone for achieving broader legalization and market acceptance. In addition, we need to take further action to combat the illicit market until a final commercial pathway for the distribution of adult-use cannabis is found."

As growth continues, consolidation may arise in the German medical cannabis market.

Perhaps more impactful than Germany's move to relax regulations around recreational cannabis is the removal of cannabis from the narcotics list. This has driven a remarkable growth in Germany's medical cannabis industry, with far-reaching effects on the entire cannabis business in Europe and even across the Atlantic. For Grünhorn, the largest medical cannabis online pharmacy in Germany, 2025 is a "year of transformation," forcing it to "quickly adapt to new regulations." Grünhorn CEO Stefan Fritsch explains, "Despite most planned cannabis cultivation associations falling by the wayside and the second pillar of legalization - planned commercial cannabis retail - still being postponed, cannabis pharmacies like Grünhorn remain the only fully effective solution offering medical cannabis prescriptions exchanged by doctors or telemedicine."

The company also highlights further changes to Germany's medical cannabis system, which has simplified the process for patients to have prescription drugs reimbursed through medical insurance and greatly increased the number of doctors able to prescribe cannabis. "These changes overall improve patient care, allowing for faster access to methods of treating chronic pain, endometriosis, insomnia, and more. The decriminalization and destigmatization of cannabis therapies also mean that patients no longer feel like they are engaging in illegal activities, promoting a safer, more inclusive medical environment," Fritsch adds.

At the same time, he warns that any new government shouldn't revert to failed policies of cannabis prohibition, as the new government is likely to be led by parties proposing to overturn cannabis reform. Cannabis lawyer Niermann agrees, stating that the medical market may "explode after the narcotics act is abolished, but consolidation must follow." Operating legally and compliantly is critical in navigating the tension between marketing and legal requirements, quality, medical demands, and advertising, he adds.

The demand for medical cannabis in Europe is constantly growing.

The demand for medical cannabis in Europe is significantly increasing, especially after regulatory policy changes in Germany. Ukrainian Health Minister Viktor Lyashko visited Germany this year to prepare for the legalization of medical cannabis in his country, with the first batch of medical cannabis expected to hit the market early next year. According to Hannah Hlushchenko, founder of the Ukrainian Cannabis Consulting Group, the first medical cannabis product has already been officially registered in Ukraine, produced by Curaleaf under her group's supervision. The hope is that Ukrainian patients can soon gain access to medical cannabis and that the market could open up in the coming year. While France and Spain seem to be at a standstill in adopting broader regulatory frameworks, Denmark has successfully integrated its medical cannabis pilot program into permanent legislation. In addition, as of April 2025, an additional 5,000 general practitioners in the Czech Republic will be allowed to prescribe medical cannabis, a move expected to significantly improve medical opportunities and drive up patient numbers.

Cannavigia also notes that international companies are showing interest in the Thai market and expanding production to meet demand. As more Thai companies want to export products to Europe, Sebastian Sonntagbauer, Head of Successful Division at Cannavigia, emphasizes the importance of ensuring that Thai products meet strict European standards.

The UK will focus on quality assurance and building patient trust.

The UK's growing cannabis market in 2024 may have reached a "critical crossroads" in terms of product quality and compliance, according to Matt Clifton, Communications Director at Dalgety. He warns that issues of contamination with molds and other toxins are driven in part by a demand for non-irradiated products and may "undermine patient trust in the market." This shift towards quality assurance is not just about patient care, it's also about rebuilding the industry's reputation and trust. "While price pressures may draw short-term consumers, this approach is unsustainable and risks damaging the industry's reputation. Companies that invest in higher standards, such as those holding GMP certification, will gain an increasingly larger market share as discerning patients are only sensitive to safety and consistency, not affordability."

Following the UK's regulators banning strain names on medical cannabis flower products this year, Clifton also expects regulatory agencies to strengthen their oversight of the industry over the next 12 months, requiring importers to conduct higher-level testing on products entering the UK. Meanwhile, Adam Winstock, CEO of a UK medical cannabis company, emphasizes that e-prescriptions approved by the UK's Medicines and Healthcare products Regulatory Agency this year will "significantly reduce waiting times for patients, streamline the process, and encourage more Britons to consider medical cannabis as a treatment option. Collaboration between medical professionals, patients, and healthcare service providers is key."

Emerging product trends: cannabis extracts, edibles, and personalized medicine. As the market matures, the categories of medical cannabis products may gradually expand, including increased demand for edibles and extracts and decreased demand for dried flower. The UK has already introduced lozenges and e-cigarettes, but flower remains the most commonly prescribed product type. Winstock hopes to see more prescribing doctors recommend cannabis oil and extracts, particularly for patients who have never used cannabis before, ensuring a "more balanced, effective mixed approach to treatment." In other European markets, German medical cannabis company Demecan made an appearance earlier this year at ExpoPharm with its edible cannabis product, while in Luxembourg, regulatory agencies are planning to limit access to high-THC flower gradually, looking to phase out flower products and replace them with cannabis oil. In the coming year, we will see more personalized cannabis medicines. Medical cannabis companies are preparing to launch customized blends of concentrated extracts and other consumption form options, such as specific cannabis concentrates. Future research will explore the impact of medical cannabis on specific diagnoses, long-term treatment outcomes, cost savings on medical care, and differences between administration methods, such as extracts and capsules. Researchers also emphasize the advantages of glass containers over plastic ones for storing cannabis materials.

Manufacturing process innovation.

As the range of cannabis products gradually expands in 2025, the industry will also need more innovative manufacturing processes. Rebecca Allen-Tapp, Product Manager at Paralab Green, a supplier of cultivation equipment, notes that more companies are adopting automation and in-house solutions that offer "greater flexibility, allowing producers to streamline processes." Rebecca states, "Investing in flexible equipment, like near-infrared spectrometers for nutrient monitoring and qPCR systems for early pathogen detection, can bring many previously outsourced services in-house to help companies adapt to the growing and diversifying market demands."

Currently, with the rise of "small-batch, artisanal cannabis" carving out a unique niche market in the cannabis industry, there is increasing demand for specialized "accurate and consistent small-batch production equipment" tailored to this niche market.

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