New Zealand’s Medicinal Cannabis Supply Grows 14x: From CBD Oils to THC-Dominant Flower

What does this mean for the global cannabis industry?

When New Zealand’s Medicinal Cannabis Scheme commenced on 1 April 2020, the country’s entire quarterly market amounted to 4,827 packs — a handful of CBD oils and oral liquids reaching a patient population still navigating the regulatory novelty of legal prescribed cannabis. Five years later, the numbers look entirely different. Health New Zealand data shows that dispensings soared to 265,731 in 2025, while quarterly supply hit 73,725 packs in Q2 2024 — a fourteenfold increase from the scheme’s opening quarter. The data is not industry projection; it comes from official Medicinal Cannabis Agency supply reporting, cross-referenced in peer-reviewed analysis published in the New Zealand Medical Journal.

The composition of that supply has shifted as dramatically as the volume. In 2022, CBD-dominant products accounted for 61% of all packs dispensed. By 2025, THC-containing products had claimed 80% of the market — a reversal driven almost entirely by dried cannabis flower in forms approved for vaporisation and oral tea preparation. This is not merely a statistical footnote. It signals a structural maturation: patients and prescribers are moving decisively toward higher-potency, flower-based formulations, and the regulatory infrastructure has kept pace. As of 2026, New Zealand operates one of the strictest pharmaceutical-grade medicinal cannabis frameworks in the Asia-Pacific region, with 41 licensed companies, more than 80 verified products, and an export licensing pipeline that is processing applications in 6.4 working days on average — down from 22.5 working days in 2022/2023.

For APAC operators evaluating market positioning, this trajectory carries significant strategic weight. New Zealand’s scheme is small relative to Australia’s 923,000-prescription market, but it is legally coherent, internationally integrated, and undergoing a second wave of regulatory reform designed to reduce red tape and accelerate export. Understanding what the scheme permits, who administers it, and how supply dynamics are evolving is essential context for any operator active — or considering activity — in the southern Pacific cannabis corridor.

The Regulatory Foundation: Misuse of Drugs Act to Medicinal Cannabis Scheme

Legislative History

New Zealand’s medicinal cannabis framework rests on a clear statutory chain. The Misuse of Drugs (Medicinal Cannabis) Amendment Act 2018, which received Royal Assent on 17 December 2018, amended the foundational Misuse of Drugs Act 1975 to create an initial legal pathway for terminally ill individuals to possess and use cannabis, and critically, established the regulation-making power that enabled the Medicinal Cannabis Scheme itself. The 2018 Amendment Act’s passage through Parliament was supported by Labour, New Zealand First, and the Greens, with the explicit mandate to create a licensing and quality standard framework within 12 months of enactment.

That framework materialised on 16 December 2019 when the Misuse of Drugs (Medicinal Cannabis) Regulations 2019 were made by Order in Council. The Regulations came into force on 1 April 2020, simultaneously launching the Medicinal Cannabis Scheme and the Medicinal Cannabis Agency — the Ministry of Health unit responsible for administering it. The Scheme also operates within the broader medicines law framework of the Medicines Act 1981, with Medsafe (New Zealand’s medicines regulator) retaining authority over products seeking full formal consent for distribution.

How the Scheme Works

The Medicinal Cannabis Scheme creates a licensing and quality verification system with five core licensed activities:

• Cultivation activity — authorises growing cannabis plants and supplying seeds, plants, or starting material to other licensed entities
• Seed supply activity — authorises supply of seeds specifically
• Research activity — authorises administering medicinal cannabis products to research subjects in clinical trials
• Possession for manufacture activity — covers processing dried cannabis, extracting cannabis-based ingredients, manufacturing medicinal cannabis products, performing laboratory testing, and product development
• Supply activity — authorises exporting starting material, cannabis-based ingredients, or finished medicinal cannabis products

All licensees must comply with Good Manufacturing Practice (GMP) for processed products and Good Agricultural and Collection Practice (GACP) for cultivation. The Medicinal Cannabis Agency assesses each product against the minimum quality standard before it may be supplied in New Zealand, and verified products are published on the Ministry of Health’s publicly accessible list. As of early 2026, more than 80 products have passed verification since 2020, including 25 new products added in 2024 alone.

The Minimum Quality Standard

The minimum quality standard, set out in Part 1 of the Misuse of Drugs (Medicinal Cannabis) Regulations 2019, is the scheme’s central quality gate. It establishes testing requirements and maximum limits — for microbial contamination, heavy metals, pesticides, and cannabinoid content — that all medicinal cannabis products and cannabis-based ingredients must meet before import or supply in New Zealand. The standard is benchmarked against the European Pharmacopoeia (11th edition), aligning NZ requirements with EU pharmaceutical norms.

The minimum quality standard explicitly does not assess safety or efficacy. Products that meet the standard may be prescribed; their therapeutic claims are not independently evaluated unless the product pursues full Medicines Act consent — a pathway currently completed only by Sativex (nabiximols) and Epidyolex (cannabidiol). Every other medicinal cannabis product available in New Zealand is an unapproved medicine prescribed under Section 29 of the Medicines Act 1981, meaning any doctor can prescribe any verified product without ministerial approval or specialist referral — a key access liberalisation that took effect on 1 April 2020.

Supply Data: The 14x Growth in Detail

Year-by-Year Pack Volume

The fourteenfold supply increase confirmed in the New Zealand Medical Journal is not a smooth compound growth curve — it reflects explosive acceleration followed by deceleration as the market absorbs the economics of a fast-maturing industry.

Sources: Business of Cannabis (citing official supply data); New Zealand Medical Journal Vol. 137 No. 1604 (2024); The Talman Group (citing Health New Zealand data)

The THC Shift

The most consequential structural change is the inversion of the CBD-to-THC ratio. In Q2 2022, CBD-dominant products made up 68% of pack unit sales; by Q2 2024, THC-dominant flowers had grown to 63% of sales, with balanced THC/CBD products contracting from 18% to 10%. By full-year 2025, THC-containing products (THC-only plus balanced) represented 80% of all supply.

Several factors drive this shift. Dried cannabis flower — the dominant THC delivery format — is substantially cheaper per dose than imported CBD oils. Price data from 2024 shows THC flower averaging NZ$11-14 per gram, compared to CBD oils priced at NZ$100-120 per 30mL bottle. Private cannabis clinics, which expanded from approximately 11 clinics in mid-2022 to a much larger network by 2025, have actively guided patients toward flower-based products for their cost efficiency and perceived faster onset. The peer-reviewed New Zealand Medical Journal analysis identifies these private clinics — offering telehealth consultations at NZ$50-150 per appointment — as a key structural enabler of access growth, particularly for patients outside major urban centres.

From 49 Kilograms to 2,310 Kilograms: The Export Story

Supply growth is not confined to the domestic market. Export volumes of cannabis flower have increased 47-fold in four years: from 49 kg shipped offshore in 2021 to 2,310 kg in 2025. Export license applications have grown in parallel — from 26 processed in 2022/2023 to 65 in 2024/2025 — as New Zealand producers increasingly orient toward Australian, German, British, and Danish buyers.

The government’s April 2026 announcement that export licenses were being processed in an average of 6.4 working days — down from 17.8 days in 2023/2024 — signals a deliberate policy of reducing friction for exporters. Associate Health Minister David Seymour stated directly that faster processing "means product is moving quicker and cashflow is improving" for New Zealand exporters. The government is now exploring a broader or enduring export licence covering multiple consignments, rather than requiring a separate application per shipment.

The July 2024 Regulatory Reforms: What Changed

The Misuse of Drugs (Medicinal Cannabis) Amendment Regulations 2024 (SL 2024/129), which came into force on 5 July 2024, represent the scheme’s most significant regulatory update since its launch. The reforms address several structural constraints that had accumulated since 2020.

Key Changes from the 2024 Amendment Regulations

Export quality standard liberalisation. The most commercially significant reform: products exported from New Zealand no longer need to meet the New Zealand minimum quality standard. They must instead meet the standards of the importing jurisdiction. This change opens pathways for operators to produce products that would not be registrable in New Zealand — for example, products that do not meet NZ microbial limits for inhalation-grade material — but meet the requirements of overseas buyers. In practice, it substantially expands the addressable export market.

Broadened category definitions. The regulations broaden the definitions of "cannabis-based ingredient" and "starting material" to be less restrictive and to not limit innovation. Separately, the definition of "cannabis-based ingredient" had unintentionally prevented dried cannabis from being used as an ingredient in oral capsules or tablets; the 2024 amendments corrected this, expanding permissible dosage forms under the scheme.

Cultivation activity flexibility. From 5 July 2024, a cultivation licence no longer lists individual cultivars where a location is authorised to grow high-THC cannabis. The licence states "All cannabis cultivars," removing a significant administrative bottleneck that had forced licensees to apply for amendments each time they wished to trial new genetics.

Expanded testing options. The range of permitted tests was broadened, and the pesticides permitted for use on medicinal cannabis were expanded, addressing feedback from cultivators that the original permitted list was too restrictive for commercial horticulture.

These reforms reflect a government posture of active regulatory improvement rather than passive maintenance — an important signal for operators evaluating New Zealand as an export production base.

Looking Ahead: Further Domestic Reform Signals

Beyond the 2024 amendments, the government has signalled further domestic reform. Forthcoming legislation will allow medicinal cannabis cultivators to grow low-THC hemp plants without requiring individual licences — a measure aimed at reducing overhead for operators maintaining dual cultivation programmes. Associate Health Minister Seymour has also indicated openness to additional domestic market regulatory changes, specifically noting Medsafe’s export processing improvements as a model for domestic streamlining.

Supply Constraints and Industry Consolidation

Rapid demand growth has exposed structural vulnerabilities. Stock shortages affected thousands of patients across the country in early 2026, prompting concerns from clinicians about the clinical consequences of forced product substitutions. When patients experience medication discontinuation, pharmacies and clinics must source alternative verified products — a process that takes time that patients under treatment cannot always afford.

A three-month shelf-life requirement under the current domestic rules — applied to products that carry 12-month shelf lives in overseas jurisdictions — is one constraint that industry participants cite as creating artificial supply chain fragility. Unlike fast-moving consumer goods, medicinal cannabis products are produced under regulated pharmaceutical conditions with stringent testing requirements at each stage; ordering to match demand is inherently difficult when regulatory timelines are unpredictable.

Industry Closures

The supply-demand stress has coincided with a wave of company failures among domestic producers:

These closures share a common diagnosis: high fixed costs — GMP-compliant facilities, pharmaceutical-grade testing infrastructure, regulatory compliance overheads — against a domestic market too small and a regulatory framework too granular to generate the throughput required for profitability. New Zealand’s market, currently estimated at approximately NZ$78 million (US$68 million), is an order of magnitude smaller than Australia’s, yet the compliance burden is comparable. The economics favour scale, and scale in a 5-million-person domestic market is structurally limited.

For operators who have already built compliant infrastructure, the closures represent market share opportunities. Import dependency is growing — Australia and Canada supply the majority of finished product — but domestic operators with differentiated genetics, export relationships, or proprietary processing capabilities remain competitive.

Who the Scheme Serves: Patient Access and Equity

Prescribing Profile (May 2023 – April 2024)

The New Zealand Medical Journal analysis provides the most granular patient access picture available from official data. Over the annual period from May 2023 to April 2024:

• More than 160,000 prescriptions were written
• 45% of prescriptions were for THC-dominant or THC-only products
• 40% of prescriptions were for flower products
• Males received 58% of prescriptions overall
• Females dominated the 60+ age bracket

Patient growth has been substantial. From 9,401 registered patients in 2021, the patient base grew to 17,416 in 2022 and 35,359 in 2023 — a year-on-year doubling that reflects both increasing physician confidence and expanding clinic networks. By 2025, dispensing data indicates a patient population dramatically larger than the official 2023 figure, though a precise 2025 patient headcount has not been published by the Medicinal Cannabis Agency as of May 2026.

Equity Gaps Remain

Access improvement has not been uniform. Māori patients received 12.9% of prescriptions in the 2023-2024 annual period despite representing 17.4% of New Zealand’s population — a persistent underrepresentation that researchers attribute to cost barriers, geographic service gaps, and the relative concentration of prescribing activity in urban private clinics. Pacific Peoples received 1,716 prescriptions annually against a population that would suggest a substantially higher number if access were equitable.

Pharmac, New Zealand’s government medicines purchasing agency, has the authority to fund medicinal cannabis products through its standard consideration process, including for individuals in exceptional clinical circumstances. However, no medicinal cannabis products are currently publicly funded in New Zealand under Pharmac’s general schedule, meaning the entire market operates on private prescription and patient out-of-pocket expenditure — a structural constraint on equitable access that remains unresolved.

APAC Context: Where New Zealand Fits

New Zealand’s medicinal cannabis framework does not exist in isolation. It is part of a broader Asia-Pacific regulatory landscape that is simultaneously maturing, with Australia’s billion-dollar cannabis market serving as the region’s dominant volume player and NZ increasingly positioned as a premium genetics and GMP-compliant export origin.

The bilateral trade dynamic between Australia and New Zealand is notable: New Zealand exported 306 kg to Australia in 2023, while simultaneously importing 587 kg from Australia during the same period. This apparent paradox reflects the infrastructure gap around irradiation — necessary to achieve inhalation-grade microbial standards for flower — that New Zealand currently lacks domestically. Operators in both markets are navigating complementary strengths: NZ’s outdoor cultivation advantages and premium genetics against Australia’s processing infrastructure and larger domestic demand base.

Prohibition Partners’ Global Cannabis Report projects New Zealand’s market revenue to more than double to over US$1.3 billion by 2028 — a projection that assumes continued patient and prescription growth, an expanding verified products list, and the export reforms taking full effect. That ceiling is ambitious for a 5-million-person country, but the trajectory of the scheme — 14x supply growth in five years — provides some empirical grounding for optimistic forecasting.

For a detailed look at the licensing requirements operators must meet within New Zealand’s framework, GrowerIQ has previously published a full guide to obtaining a New Zealand cannabis licence and an overview of New Zealand’s medicinal cannabis regulatory framework for producers, covering GMP obligations, recordkeeping, and the five licensed activity categories.

What 14x Growth Means for Compliance Infrastructure

The fourteenfold supply increase is not just a market story — it is a compliance infrastructure story. When quarterly pack volumes grow from fewer than 5,000 to more than 73,000, every step of the production and distribution chain faces proportionally greater documentation, testing, and traceability demands. The Medicinal Cannabis Scheme’s requirements for batch-level testing, chain of custody documentation, GMP compliance, and product verification records were manageable at 2020 volumes on manual systems. At 2025 and 2026 volumes, they are not.

This is precisely the challenge that purpose-built seed-to-sale platforms address. New Zealand’s licensed operators must maintain full traceability from genetic origin through cultivation, post-harvest processing, quality testing, and supply to dispensing pharmacies — all within a regulatory framework that mandates records consistent with pharmaceutical GMP standards. For operators also pursuing export markets, the 2024 amendment regulations’ export quality standard reform means product data must be reportable against multiple jurisdictions’ standards simultaneously.

GrowerIQ’s seed-to-sale platform was built for precisely this environment — one where growth is fast, compliance is non-negotiable, and the cost of a quality failure is measured not just in regulatory penalties but in patient harm and product recalls. For NZ operators navigating the Medicinal Cannabis Agency’s verification requirements, maintaining the batch documentation that audits demand, and managing the supply chain complexity of a market that is simultaneously growing and consolidating, compliant digital infrastructure is not a future consideration — it is a present operating requirement. The scheme’s next five years will be defined by which operators can scale their compliance alongside their production.

This analysis is current as of May 2026 and draws on the Misuse of Drugs (Medicinal Cannabis) Regulations 2019 and Misuse of Drugs (Medicinal Cannabis) Amendment Act 2018 (New Zealand Legislation), the Misuse of Drugs (Medicinal Cannabis) Amendment Regulations 2024 (SL 2024/129), official Beehive.govt.nz government press releases, Pharmac guidance on medicinal cannabis funding, and Medsafe/Ministry of Health regulatory publications. Market supply figures are drawn from peer-reviewed analysis in the New Zealand Medical Journal (Vol. 137 No. 1604, October 2024), Health New Zealand dispensing data reported by The Talman Group, and industry tracking by Business of Cannabis and Cannamonitor. Market revenue and projection figures reflect Prohibition Partners and Cannabiz reporting. Figures reflect the best available data as of the publication date.

Sources

• Misuse of Drugs (Medicinal Cannabis) Amendment Act 2018 — New Zealand Legislation — New Zealand Parliamentary Counsel Office
• Misuse of Drugs (Medicinal Cannabis) Regulations 2019 — New Zealand Legislation — New Zealand Parliamentary Counsel Office
• Misuse of Drugs (Medicinal Cannabis) Amendment Regulations 2024 (SL 2024/129) — New Zealand Legislation — New Zealand Parliamentary Counsel Office
• Medicinal Cannabis Scheme: Update from the Ministry of Health (March 2020) — Medsafe / Ministry of Health NZ
• Medicinal Cannabis Scheme — now operational (June 2020) — Medsafe / Ministry of Health NZ
• Funding for medicinal cannabis products — Pharmac — Pharmac Te Pātaka Whaioranga / NZ Government
• Medicinal cannabis export licenses take 6.4 working days in 2026 — Beehive.govt.nz — New Zealand Government
• Implementation of the Medicinal Cannabis Scheme in New Zealand: six emerging trends — New Zealand Medical Journal, Vol. 137 No. 1604 (October 2024)
• New Zealand Medicinal Cannabis Dispensing Exploded From 2020 To 2025 — The Talman Group (citing Health New Zealand data)
• New Zealand’s Medical Cannabis Market Growth Slows as Major Operator Calls in Administrators — Business of Cannabis
• New Zealand’s Medicinal Cannabis Advent: From Local Roots to Global Reach — Cannamonitor
• Medicinal cannabis exports getting overseas faster, government considers more permanent licences — RNZ News
• New Zealand Medicinal Cannabis — Industry Overview — New Zealand Trade and Enterprise (NZTE)
• New Zealand: Medicinal Cannabis Bill Passed — Library of Congress Global Legal Monitor
• NZ’s medicinal cannabis ecosystem hopes to harvest value-add opportunities — RNZ News
• Key changes to the Medicinal Cannabis Scheme July 2024 (Ministry of Health guidance) — Ministry of Health NZ