By Paul Gallagher

AMSTERDAM (Reuters) Sept 01 - The Netherlands Monday became the world's first country to make cannabis available as a prescription drug to treat cancer, HIV and multiple sclerosis patients, the Health Ministry said.

The Netherlands is making the drug widely available to chronically ill patients amid pressure on countries like Britain, Canada, Australia and the United States to relax restrictions on its supply as a medicine.

Dutch doctors will be allowed to prescribe it to treat chronic pain, nausea and loss of appetite in cancer and HIV patients, to alleviate MS sufferers' spasm pains and reduce physical or verbal tics in people suffering Tourette's syndrome.

"From September 1, 2003 pharmacies can provide medicinal cannabis to patients with a prescription from a doctor. Cannabis has a beneficial effect for many patients," the Health Ministry said.

The Netherlands, where prostitution and the sale of cannabis in coffee shops are regulated by the government, has a history of pioneering social reforms. It was also the first country to legalize euthanasia.

Two companies in the Netherlands have been given licenses to grow special strains of cannabis in laboratory-style conditions to sell to the Health Ministry, which in turn packages and labels the drug in small tubs to supply to pharmacies.

As well as pharmacies, 80 hospitals and 400 doctors will be allowed to dispense five-gram doses of SIMM18 medical marijuana for 44 euros ($48) a tub and more potent Bedrocan at 50 euros.

The Health Ministry recommends patients dilute the cannabis -- which will be in the form of dried marijuana flowers from the hemp plant rather than its hashish resin -- in tea or turn it into a spray.

HIV SUFFERERS WELCOME MOVE

A British drug firm pioneering cannabis spray medicine to give pain relief for multiple sclerosis patients is hoping to launch the product in Britain later this year.

The association of HIV patients in the Netherlands welcomed the government's move to make cannabis available in high-street pharmacies.

"We are glad the government recognizes that for some people it can improve the quality of life," said Robert Witlox, managing director of HIV Vereniging. The association has called on health insurers to cover the cost of the drug like any other.

The government, which recognized many chronically ill people were already buying cannabis from coffee shops, said it should only be prescribed by doctors when conventional treatments had been exhausted or if other drugs had side-effects.

The government said it would start distributing to pharmacies Monday. The Health Ministry's Office of Medicinal Cannabis has a monopoly on wholesale distribution of the drug, grown in laboratory-style conditions to ensure medicinal purity.

The ministry estimates up to 7,000 people in the Netherlands have used cannabis for medical reasons, buying it in coffee shops. It said this could more than double once it was available from pharmacies in pure medicinal form.

Cannabis has a long history of medicinal use. It was used as a Chinese herbal remedy around 5,000 years ago, while Britain's Queen Victoria is said to have taken cannabis tincture for menstrual pains.

But it fell out of favor because of a lack of standardized preparations and the development of more potent synthetic drugs.

Critics argue that it has not passed sufficient scientific scrutiny at a time when researchers are trying to determine if it confers the medical benefits many users claim. Some doctors say it increases the risk of depression and schizophrenia. ($1=.9145 Euro)

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