A byline by Michael Sassano
The global cannabis industry has experienced both great success and significant challenges in 2025. Volumes are surging and new countries are coming online, signaling market expansion. However, a „dark cloud“ hangs over these numbers as regulators in key selling markets—such as the U.K., Germany, and Australia—and exporting countries like Portugal adjust to the increased volumes and seek greater control. A real tug-of-war has emerged, with successful legal cannabis strategies being met by attempts at new regulation to address the fast advancements in the sector. Cannabis entrepreneurs are facing sleepless nights trying to keep up with the changing landscape and the need to meet surging demand.
Regulatory Headwinds in Key Markets
The U.K. Clampdown:
The year began with the U.K. regulators embarking on a quest to clamp down on what they perceive to be recreational-style products entering under special access guidelines for cannabis. This started with labeling changes that caused large delays in product shipments. Regulators quickly addressed the use of bulk repackaging, a loophole that did not require label checks before export, and this practice was subsequently closed. Popular products, such as pastilles from CuraLeaf and other international imports, also came to a grinding halt. These changes—all seemingly aimed at advertising, labels, and products with „recreational“ appeal like pastilles—have caused shortages and heartache for producers, stalling months of sales.
Portugal’s Export Challenges:
In May 2025, Portugal, the number two exporter of cannabis products to Europe, confronted a scandal involving grey market products making their way through legal Portuguese cannabis companies and into popular grey markets like Spanish Social Clubs. This caught regulators off guard and created a virtual stop in import and export permits for months, with difficulties still persisting by October. The solution has been to require even more paperwork and verifications on importing countries.
While this has caused delays, groups with the best regulatory compliance are seeing their products prioritized for imports and exports by presenting the proper documentation. Conversely, many groups are being exposed for deficiencies in their quality paperwork. Some companies are now in danger of losing their licenses, with a few already under supervision or having lost their licenses entirely. A flight to the largest, most compliant companies is increasing to fill the supply gaps in the market.
Germany’s Quota and Telemedicine Overhaul:
As if the year hadn’t had enough drama, Germany hit its importation quota for flower with the UN. Simultaneously, the new government proposed an overhaul of the telemedicine markets, which is expected to lead to a market tightening. As the market more than doubled since cannabis was de-scheduled as a narcotic, telehealth clinics and big pharma entered Germany in force. While the new regulations have yet to take effect, there is a sober mood in Germany as groups plot their next move.
Inventories that were once bloated are now running low since increasing the import cap is taking longer than expected. This clearly shows the new government’s position on cannabis is having a chilling effect on the future market and on getting imports and exports moving again.
Australia’s Growing Scrutiny:
Australia continues to increase in size, but regulators are voicing concerns over advertising, compound pharmacists, and prescribing teleclinics. Over the last two years, doctors have even lost their licenses to practice, keeping everyone on guard.
The Unavoidable Reality
No one knows the next regulatory move, but most can easily predict that any new regulatory changes that decrease patient access will certainly drive people away from the legal markets. Despite all markets increasing in size in 2025, with new announcements for Spain, France, and Slovenia coming online, there are concerns everywhere. Portuguese producers are concerned about getting licenses quicker, Canadian producers are trying to get more product to the U.K. and Germany, and U.K. and German clinics are trying to increase their patient base. Regulators, meanwhile, are trying to grapple with the large increases and associated issues as best as they can.
One thing is certain: legal cannabis is a success. Anything that limits access for patients or creates shortages will undoubtedly benefit the grey markets, as patients will shift to easier avenues.
About the author
Michael Sassano is one of the most respected executives in the pharmaceutical cannabis space today. Currently, Michael serves as Interim CEO and Chairman of the Board for SOMAÍ, a leading EU-GMP vertically integrated Multi-Country Operator (MCO) company with a global distribution footprint for the largest and most advanced EU-GMP-certified cannabinoid-containing pharmaceutical extract portfolio.
Somaí is set to launch multiple versions of Oral Gums from October through January. The lineup will include medical Somaí extract and terpene Oral Gums, Rosin Oral Gums, and fast-acting Oral Gums. In addition, Cookies, Sherbinskis, and Jack Herer-branded Oral Gums will roll out across three countries.
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