A Hamilton medicinal pot grower is bracing for a big change, as the Conservative government is launching a $1.3-billion free market in medical marijuana.

Starting Tuesday, licences will no longer be issued to people who wish to grow their own medical marijuana in Canada. As of April 2014, the practice will be outlawed. Anyone using medical marijuana will need to get it from a licensed medical supplier.

Derek Pedro is a Health Canada designated medical marijuana grower and user in Hamilton, and he now has to change his operation to fall in line with the new laws. According to his website, Pedro is currently producing 322 grams of medicinal marijuana a day at his 110-light facility that has a total of 7,000 square feet of growing space.

“In the end I have chosen to work for a commercial [licensed producer,]” he told CBC Hamilton. “They are responsible, ethical, and above all else compassionate. It took four months to decide but in the end I still feel like I will be helping the average medical marijuana user.”

Medical marijuana by the numbers

  • Current number of users approved by Health Canada: 37,359.
  • Number of patients with personal licences to grow marijuana for themselves: 25,600.
  • Number of growers licensed to produce marijuana for a maximum of two patients each: 4,200.
  • Current number of entrepreneur applications to grow medical marijuana under new rules: 156.

Health Canada is phasing out an older system that mostly relied on small-scale, homegrown medical marijuana of varying quality.

In its place, large indoor marijuana farms certified by the RCMP and health inspectors will produce, package and distribute a range of standardized weed, all of it sold for whatever price the market will bear. The first sales are expected in the next few weeks, delivered directly by secure courier.

Health Canada implemented its previous medical marijuana access regulations (MMAR) in 2001. Under that program, people with "grave and debilitating illnesses" could be granted legal access to marijuana for medicinal purposes. People seeking a permit applied in writing to Health Canada, with a supporting document from a medical practitioner.

'Made to fail'

But Pedro is quick to denounce the old system. “The MMAR system was made to fail,” he said. “There was no genuine want for it to work even though Health Canada had 10 years to do so.”

He also ran into trouble in that old system. Last year, the RCMP charged Pedro with trafficking marijuana and conspiracy to produce marijuana. Police allege he indirectly sold 500 marijuana clones to undercover police officers involved in the probe. Clones are the rooted cuttings of adult marijuana plants.

There are currently 37,400 medical marijuana users recognized by Health Canada, but officials project that number will swell to as many as 450,000 people by 2024.

The profit potential is enormous. A gram of dried marijuana bud on the street sells for about $10 and Health Canada projects the legal stuff will average about $7.60 next year, as producers set prices without interference from government.

Revenues for the burgeoning new industry are expected to hit $1.3 billion a year by 2024, according to federal projections.

Ottawa says it's acting to weed out abuse in the system and to ensure quality control over a medicinal product whose popularity is growing rapidly. Health Canada says that when the medical marijuana program was established in 2001, there were fewer than 500 authorized users across the country. That figure has since grown to more than 30,000 and is expected to keep rising.

Forcing users underground

But marijuana advocates and some small growers worry the changes will end up driving medical marijuana users back underground.

Laurie MacEachern, the director of the Medicinal Cannabis Patients Alliance of Canada, says she has no doubt about how the changes will affect her. MacEachern has government permission to grow her own supply of medical marijuana.

Her garden provides her with a year's supply, which she uses to treat chronic symptoms from a number of ailments, from back pain to depression.

"If it goes forward the way it’s intended, I will not be able to medicate unless I do it illegally," she says.

MacEachern says she can grow her own cannabis for just pennies a gram. The federal government is predicting licensed suppliers will sell a gram of medicinal marijuana for roughly $7.60 when the new system comes into effect next year.

Ottawa will allow the market to decide whether the price goes up or down. With more than 150 firms bidding to become suppliers, the thinking is that costs could eventually fall, though there's no guarantee.

Pedro says that no matter what, he plans to remain an advocate for cannabis and a patient’s right to use it.

“All I can say is I love to grow cannabis, I think it's an amazing plant with huge potential to not only treat ailments but also be used as preventative medicine for Parkinson’s and Alzheimer's.”

With files from The Canadian Press and Tom Parry