CannTrust's license gets suspended
Well here’s one more bit of bad news for CannTrust (though it’s been expected at this point). The Canadian company was one of the biggest producers and distributors of cannabis in the Great White North, but as of yesterday, the company says in a press release, its license for making and selling cannabis has been suspended. This is an expected move by Health Canada, after CannTrust was first found growing in unlicensed areas at one of its facilities, and even accused of selling legal product grown from seeds purchased from the illegal market.
Not great times for CannTrust, to say the least. The suspension means that CannTrust currently can’t sell or distribute cannabis at all, though there’s only a partial suspension around cultivation, which means the company will be able to harvest, dry, and trim product that it’s currently growing. Health Canada has said that it will reinstate the license if CannTrust can show “reasons for the suspension no longer exist or if CannTrust demonstrates that the suspension was unfounded.” Presumably, CannTrust is trying its best to do one or both of those things — the company has said that it “remains committed to being in full regulatory compliance,” so ideally, any issues will be fixed as quickly as possible, CannTrust will get the license reinstated, and it can move on from all of these problems. Meanwhile, the company’s stock is, not unexpectedly, in the dumps, coming from a high of $10 earlier this year down to around $1.29.
Even so, going through all of these issues at such a crucial time (as companies in Canada are growing as fast as they can, and trying to deal with supply and distribution problems all over the place) might be devastating for the company. If CannTrust can’t find a way back into Health Canada’s good graces, the company may end up as less of a pioneer in the Canadian cannabis industry, and more of a cautionary tale.