Connect with us

Hi, what are you looking for?

Business

CannTrust Holdings’ stock sinks further over regulatory breach

CannTrust is under scrutiny by Health Canada after it was found on Monday that the Vaughn, Ontario-based company grew marijuana at its Pelham, Ontario, plant when 5 of its 12 grow rooms had not yet been licensed.

After that news came out on Monday, Market Watch reported that a Danish company, Stenocare A/S said in a statement it had sold some of the illegally grown marijuana to some of their patients.

On Friday morning, CannTrust announced it was halting all cannabis sales and shipments while Health Canada reviews its processing plant in Vaughan, Ontario. Now its shares are tanking, according to Barrons.

The company points out that the move is voluntary. In an email, a CannTrust representative said: “This review is part of a visit that was scheduled by the regulator when CannTrust voluntarily advised Health Canada of issues that may impact compliance at this facility regarding product storage. CannTrust is working closely with the regulator through the review process and expects to provide further detail of the duration of the hold and other developments as they become available.”
About 12,700 kilograms (28,000 pounds) of CannTrust’s marijuana inventory has been seized, pending the outcome of the government investigation.

The Canadian Cannabis Act forbids the export of unlicensed cannabis, and anyone who does so is guilty of an indictable offense with penalties ranging from a fine to imprisonment. In an emailed statement, CannTrust said that all of the products with the exception of one sent to Stenocare had been grown in licensed grow rooms.

The Globe and Mail reported Thursday that the company allegedly hid thousands of pot plants behind temporary walls in order to stage photographs of an unlicensed growing room, citing a former employee. Those photographs were sent to regulators, the newspaper said, according to the Financial Post.

CannTrust Holdings shares opened on the NYSE at $2.79. As of 1:00 p.m. July 12, CannTrust shares are at $2,73 after falling nearly 25 percent on Monday.

Avatar photo
Written By

We are deeply saddened to announce the passing of our dear friend Karen Graham, who served as Editor-at-Large at Digital Journal. She was 78 years old. Karen's view of what is happening in our world was colored by her love of history and how the past influences events taking place today. Her belief in humankind's part in the care of the planet and our environment has led her to focus on the need for action in dealing with climate change. It was said by Geoffrey C. Ward, "Journalism is merely history's first draft." Everyone who writes about what is happening today is indeed, writing a small part of our history.

You may also like:

Business

In March, prices rocketed to more than $10,000 a tonne in New York after a poor harvest in West Africa.

World

Medical team members evacuate a Muslim pilgrim, affected by the soarching heat, at the base of Mount Arafat, also known as Jabal al-Rahma or...

Tech & Science

It was also found that the relationship between genotype and phenotype is more different than the relationship between coffee and tea.

Business

Asian markets extended last week’s poor run with more losses Monday, following on from another tepid lead from Wall Street.