Cyber security breaches and attacks are common threat to businesses across the world. For organisations operating in the developing medical cannabis industry, at the intersection of healthcare and a product with some stigma attached, are at risk of becoming prime targets for cybersecurity threats.
Increasing risks to a growing sector
The cannabis industry has seen significant growth over the past decade. As the sector expands, it has adopted various digital platforms and technological solutions to streamline its operations, manage patient data, and maintain compliance.
The medical cannabis industry, like other healthcare industries, also requires greater cyber protection to protect sensitive information about customers and patients.
The sector's technological advancement has also opened the door to an array of cybersecurity risks. Also due in part to the current economic climate, the trend is smaller organisations viewing cybersecurity as less of a priority, and so undertaking less monitoring of network security and logging of breaches or attacks.
Over 11% of businesses experienced cybercrime this year
A survey carried out for the UK Government through the security experts at the National Cyber Security Centre has shown so far during 2023 that a total of 11% of businesses and 8% of charities have experienced cybercrime in the past months, rising to 26% of medium businesses, 37% of large businesses and 25% of high-income charities.
Looked at another way, among the 32% businesses and 24% of charities identifying any cyber security breaches or attacks, around a third ended up being victims of cybercrime, with 9% reporting the crime to be fraud.
Cyber insurance policies are more common in medium businesses than large ones, with under four in ten businesses (37%) and a third of charities (33%) being insured against cyber security risks – rising to 63% of medium businesses and 55% of large businesses.
Why is cybersecurity so important for businesses?
Cybersecurity is incredibly important for medical cannabis organisations because it safeguards sensitive data, protects digital assets, ensures business continuity, and helps maintain customer trust.
From cloud security to defending against cyber attacks, failure to prioritise cybersecurity can lead to severe consequences, both in terms of financial losses and reputational damage.
Cybersecurity measures are designed to prevent unauthorised access, modification, or theft of sensitive data, whether from cloud environments, data centres, emails or mobile devices. This includes customer information, financial records, intellectual property, and proprietary business data.
Data breaches can lead to identity theft, fraud, legal penalties, and significant financial losses. UK industries are subject to data protection and privacy regulations, such as GDPR. Non-compliance with these regulations can result in substantial fines and legal consequences.
Good cybersecurity solutions, security awareness training for staff and regular vulnerability scanning can help organisations meet these compliance requirements.
Risks of a cybersecurity breach
Building trust and a positive reputation is crucial for start up medical cannabis organisations. As organisations within the sector scale and gain more customers and patient data, the areas in which criminals can carry out cyber attacks increases.
Loss of trust from patients and customers
With the cannabis industry still fighting to overcome stigmas in some circles, businesses cannot afford negative press related to a data breach.
A data breach or security incident can erode customer and patient trust and damage your reputation, leading to decreased customer confidence, loss of business, and challenges in attracting investors and partners.
Operational issues
A successful cyberattack could potentially cripple operations for a small medical cannabis business - disrupting operations, potentially stalling crucial processes such as patient care, prescription deliveries, and research activities.
Financial repercussions
Beyond potential fines from non-compliance, a cyberattack can have direct financial repercussions. Ransomware attacks, in which hackers demand money to restore data access, have become increasingly common.
Businesses may also face lost revenues from downtime and potential legal action arising from breaches.
Barriers to investment and collaboration
Investors, partners, and clients often assess an organisations cyber security solutions, security technologies - such as firewalls and endpoint security services, protocols for incident response, threat intelligence and threat detection solutions before entering into agreements or collaborations.
A strong cybersecurity position can be a selling point, demonstrating your commitment to data security and reducing the perceived risk for potential partners and investors.
From cybersecurity awareness training for team members to email security policies and a proactive approach to risk management, demonstrating your commitment to good cyber security can pay off in many ways.
Cybersecurity considerations for the emerging UK cannabis sector
The UK cannabis sector is still emerging, with many start up businesses having limited financial and human resources making them attractive targets for cybersecurity threats.
The regulatory landscape is evolving, and even the smallest organisations are increasingly being held accountable for data breaches and security incidents. But, statistics show emerging markets are at higher risk due to these financial barriers and security dropping down the list of priorities.
Hackers may assume that startups have weaker cybersecurity measures, such as lack of multi factor authentication for cloud services, poor database security or poor access management protocols, making them easier to breach.
Weak cybersecurity practices within an organisation can also extend to its partners and suppliers. A breach in one part of the supply chain can potentially compromise the entire chain, affecting multiple businesses. This is of particular concern to the emerging medical cannabis sector and the close links and collaborations within supply chains. Awareness of this risk and ensuring data security with partners can act as its own insurance policy.
Ensure cyber security measures are right from day one
Establishing strong cybersecurity practices from the beginning helps prevent future challenges as your organisation grows.
Engaging cyber security companies to integrate good services during the start up phase is both more efficient and effective - it can be difficult and costly to retrofit security measures later on.
When choosing cybersecurity companies, its crucial to choose a provider with an in depth knowledge of the medical cannabis industry as well as general cybersecurity threats.
Get support to protect your cannabis organisation from online attacks
As the global cyber threat landscape evolves, attacks are becoming more sophisticated and targeted. Staying ahead of these threats is vital.
At Maple Tree we understand these risks and, with our cyber security services, have developed comprehensive strategies for protecting your business from cyber threats.
From risk management, data compliance, mobile device application security, incident response, ransomware blocking, vulnerability management and endpoint protection to managed services, choose a cybersecurity company experienced in managing the potential threats to your cannabis business, and secure the critical infrastructure of your business.
Author: Matt Hughes, Information Security Expert, Maple Tree.