AUSTRALIANS are expected to consume as much as 8000kg of medical cannabis worth $100 million in just the first year of being legalised, according to a study by the University of Sydney.

The figure, contained in a white paper produced by the University of Sydney Business School and medical cannabis company MGC Pharmaceuticals, is based on data from existing markets including Israel, Canada and the Netherlands.

The paper, Medicinal Cannabis in Australia: Science, Regulation and Industry, is the first of its kind to examine the logistic and economic, as well as medinical benefits of a local medicinal cannabis industry.

The federal Parliament passed legislation allowing for the cultivation of medicinal cannabis last month, and regulations governing production under licence are now being drafted.

Medicinal cannabis, already a $250 billion global industry, is expected to help tens of thousands of patients in Australia suffering from medical conditions including epilepsy, cancer, multiple sclerosis and chronic pain.

Earlier this month, the global president of Canadian firm Tilray predicted medical marijuana had the potential to be a billion-dollar industry in Australia and create thousands of skilled jobs.

University of Sydney Business School associate lecturer Michael Katz said the study’s lower figure was for the first year alone.

“We’re talking $100 million in year one, that’s the latent demand that’s already there,” he said.

“We’re not talking about increased uptake, exports, and that doesn’t include the next tech billionaire who develops an app [to tap into the market].”

Mr Katz said Australia was uniquely positioned to scale production to become a world leader in exports, rivalling producers such as Mongolia.

“I think Australia has a competitive advantage against most of these countries,” he said. “Australian agricultural products in general are considered clean, green and we have a strong rule of law.”

The authors worked closely with MGC to understand the demand side and private sector economics of the industry to come to its estimate.

“There’s a lot more to a new industry like medical cannabis than you might immediately think,” Mr Katz said.

“You’ve got the technical agriculture side of it, the medical processes such as extraction and dosage, the technology side such as scalable standardisation tools, supply chain logistics and so on.

“Obviously this will lead to important health outcomes for a wide variety of people. For example, it could provide considerable relief for those suffering from epilepsy.

“However, we’re also going to see employment and wealth creation opportunities in all of the sectors that will come together to facilitate a medical cannabis market, so it’s about much more than just the medical benefits.”

The authors said 51,000sq m of greenhouse space, or “three times the size of the Sydney Cricket Ground” would be needed to produce the amount of cannabis required to meet demand.

MGC Pharmaceuticals managing director Nativ Segev said the study confirmed the strong need for developing a medicinal cannabis industry in Australia.

“MGC Pharma has both the growing know-how and genetic expertise to be at the forefront this industry, helping tens of thousands of Australians suffering from a broad range of conditions,” he said.

frank.chung@news.com.au