With several states expressing support for clinical trials of medical marijuana, debate has begun over who will supply the drug.

Big pharmaceutical companies and local growers both claim they are best equipped to make the product in Australia.

At last week's COAG meeting, NSW, Victoria, Tasmania and the ACT all expressed support for clinical trials.

Troy Langman, chief executive of medical company Auscann, said his company started in Tasmania but he would move to any state which completed the trials first.

"We are poised to go anywhere in the country and we have the financial backing to do so," Mr Langman said.

But NSW Hemp Party president BJ Futter said the underground cannabis oil industry had been supplying cancer patients with cannabis liquids for decades and did not want to be replaced by big pharmaceutical companies.

"Our biggest battle isn't necessarily to get the plant re-legalised, it is to keep the plant as our herb," Mr Futter said.

"This is a community herb. This should not be in the control of people who have a history of not giving people real medicine."

Mr Langman warned that the underground cottage industry which produces cannabis tinctures has its limits.

"I've heard stories of people spending huge amounts of money and receiving either an inferior product or something that's not even cannabis oil," he said.

"In one case, a gentleman had it analysed and it turned out to be vegetable oil."

Concerns marijuana could lose its spiritual side

Mr Futter said he was worried that the introduction of pharmaceutical cannabis products could ignore marijuana's spiritual qualities.

"Daughters ring us up and thank us for their mother's medicine or their father's medicine," he said.

Cannabis use in Australia According to the 2010 National Drug Strategy Household Survey, 35.4 per cent of the Australian population reported using cannabis at some stage in their lives (about 6.5 million people)

According to the 2010 National Drug Strategy Household Survey, 35.4 per cent of the Australian population reported using cannabis at some stage in their lives (about 6.5 million people) 1.9 million people over the age of 14 reported using cannabis in the previous 12 months

1.9 million people over the age of 14 reported using cannabis in the previous 12 months More than 700,000 Australians reported using cannabis in the previous week

"Even dogs, this medicine helps them too. People love their dogs and they love to have their dogs healthy.

"There is the space of this herb, unconditional love for the dog."

Mr Futter said it was only a matter of time before medical marijuana products are made in Australia.

"The cannabis train has left the station, it is gathering speed, you either get out of the way or you get on board. The train has left from platform number one and that means one's self," he said.

Mr Futter said there was room for some pharmaceutical cannabis products in Australia, but marijuana should not only be available at the chemist.

"Self empowering means self growth. We will eventually have the knowledge where a family or group of people in the community will have a requirement of four to five specific strains for their specific needs," he said.

"They should be growing it in their yards or community gardens," he said.

Australia has ideal climate to produce quality cannabis

Different climates produce different cannabis strains and according to Mr Langman, Australia's climate variability is ideal for growing and exporting the product.

"Australia is actually in a very unique position because we have the whole range of climates to grow all of the cultivars, or strains, that we need to grow," he said.

"So not only does Australia have an opportunity to produce its own medicines for our population - like the poppy industry in Tasmania which supplies 50 per cent of the world's medical opioids - Australia has the opportunity to export this medicine to the world," he said.

Mr Langman said it would be a shame if companies from the United States or Europe won tenders with state governments in Australia and took over the domestic market.

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"I think as a nation we would want to be in control of the medicines we are producing and the demand is going to be such that we are going to have to produce the medicines here," he said.

Mr Langman said cannabis produced for medical purposes must be produced to high professional standards.

"Overseas they are actually having the material assayed so they know how much THC is in the product," he said.

"It is extremely important that the person is using a medicine that is appropriate for their needs. Some people do not tolerate THC well."

Mr Langman is employing experts from Europe.

"We have a world-renowned cannabis breeder who operated in Holland legally and that is important because cannabis is tricky to grow right and also to breed correctly so that we can get the correct cannabinoid profiles to treat those in need," he said.

Underground Cannabis oil industry 'must survive'

Mr Futter said the underground cannabis oil cottage industry was in operation right across Australia.

"There are a lot of people out there operating underground compassion clubs, where they understand the amazing qualities of the plant and the clubs are growing quite considerably," he said.

NSW Hemp Party's Mr Futter says Australia's underground cannabis oil industry must survive for those living on low incomes. ( ABC News: Lateline )

He said Australia's underground cannabis oil industry must survive for those living on low incomes.

"The cottage industry is striving to give it to people who are out of pocket. If they don't have the money because they are struggling, it doesn't mean they should not be getting the medicine. Some of the underground people do donate."

Mr Futter said sometimes the Hemp Party receives calls from people who are desperate for help.

"People are crying out in tears and we are the only option," Mr Futter said.

"They've been told to go home. They've been told that they will be dead in one month or two weeks.

"People are given a date. You will die on the 27th of January. Wow, it is disgraceful.

"The energy of this herb is one of compassion and empathy. Man-made things are what creates the world we live in now like wars. But that is a story for another time."