CannTrust has put a maintain on all of its cannabis gross sales and shipments after Well being Canada discovered a few of its rising amenities weren’t compliant with their insurance policies, sending CannTrust’s inventory crashing.
The corporate introduced the voluntary maintain on Thursday, saying it’s a “precaution” as Well being Canada critiques its Vaughan, Ont., facility.
The maintain got here into impact at 11:59 p.m. on July 10.
On July 8, CannTrust revealed that Well being Canada discovered cannabis was grown in 5 unlicensed rooms in its Pelham, Ont., facility. Well being Canada additionally stated they got inaccurate data from CannTrust workers.
Well being Canada put 5,200 kg of CannTrust’s cannabis inventory on maintain, whereas the corporate put an extra 7,500 kg on maintain, including as much as the “majority” of the corporate’s stock, in accordance with CEO Peter Aceto.
CannTrust stated cannabis was grown within the 5 rooms from October 2018 to March 2019 whereas Well being Canada’s licenses had been pending. Licenses had been ultimately issued for the rooms in April 2019.
Former CannTrust worker Nick Lalonde revealed final week that he was requested to place up faux partitions to obscure hundreds of unlicensed crops in photographs submitted to Well being Canada, in accordance with The Canadian Press.
Lalonde says he notified regulators after he left the corporate in Could.
CannTrust didn’t say how lengthy the maintain on all of its inventory will final however it’s working carefully with Well being Canada throughout the evaluate course of.
The corporate has appointed a particular committee of the board to analyze the matter.
Extra corporations quarantine CannTrust inventory
For the reason that information broke, different corporations have additionally put their CannTrust cannabis stock on maintain.
One firm is CannTrust’s Danish associate, Stenocare.
Stenocare stated in an announcement on Thursday that it acquired further data from CannTrust that was opposite to what the corporate first informed them, inflicting them to quarantine extra inventory. The corporate stated it should possible trigger a scarcity of medical cannabis merchandise in Denmark.
The Ontario Hashish Retailer, Nova Scotia Liquor Company and Alberta cannabis authorities additionally put a maintain on promoting CannTrust merchandise affected.
CannTrust’s shares have dropped considerably for the reason that information broke on Monday.
CannTrust’s shares went down 13 % on Friday to $3.60 a share on the Toronto Inventory Alternate — a 48 % drop from earlier within the week and near half the closing value of $6.46 the earlier Friday.
“At the moment, the impression of those issues on CannTrust’s monetary outcomes are unknown till the regulatory evaluate course of is full,” CannTrust stated on Thursday.