Canada edition / August 17, 2019



Canopy Growth reported a net Q1 non-cash loss of $1.28B, along with net revenue of $90.5M, down from an already weak $94.1M the previous quarter. Analysts expected $109M or more in revenue. The company acknowledged it remains three to five years away from profitability.
Globe and Mail

The company increased its dry-flower sales by 94% over the quarter.

Canopy released interim CEO Mark Zekulin's remarks in full. He reiterated the company strategy of building out its CBD platform in the US and aiming to acquire Acreage in full upon US legalization, and predicted the company would hit its $1B annualized revenue target by March, 2020.

The first ousted Canopy co-founder, Chuck Rifici (now CEO of Auxly Cannabis), reported he and Canopy have dropped their claims/counterclaims over his dismissal.
Twitter—Chuck Rifici

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Lizzie Post’s Cannabis Etiquette



For the second time this summer, Health Canada found CannTrust noncompliant—this time at the company's production site in Vaughan, Ontario. The company is left with no productive assets.
Globe and Mail, MJ Biz Daily

  • During inspections between July 10 and July 16, the federal regulator found the company stored cannabis in operational rooms not licensed for storage, built two areas of the facility without approval, employed insufficient security, kept poor records, and had inadequate quality-assurance protocols.
    Financial Post, Bloomberg
  • Health Canada says it cannot provide guidance about how or when it will make a decision about the company.
  • Supreme founder John Fowler noted "Secure storage amendments have been a [pain in the ass] for many."

Last fall, CannTrust shares traded at more than $15. On Monday they closed at $3.04.
CBC Business

Quick Hits

  1. Former Prime Minister Kim Campbell said the Canadian cannabis sector must have integrity—and medical operators musn't overestimate what their products can't cure—in order for it to last.

  2. Gene Simmons parted ways with LP Invictus, for whom he'd served as Chief Evangelist Officer since March of 2018, for unspecified reasons.
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Statistics Canada released its second-quarter National Cannabis Survey, and the biggest takeaway is the number of Canadians using cannabis between April and June has held steady at roughly 16% over the last year—except for those above 65.

  • Between April and June last year, 3.4% of seniors reported cannabis use. For the same period this year, the number is up to 5.5%, likely driven by those seeking relief from age-related aches and illnesses.
    The Leaf, Globe and Mail
  • Men (21%) are almost twice as likely to have consumed cannabis in the survey period than women (12%), while among cannabis users, women were nearly three times more likely (14%) to consume non-smoking methods than men (5%).
    CBC Business
  • Six months into legalization, the number of consumers buying illicit cannabis is at 42%.
  • Global reporter Patrick Cain noted consumption has increased in places legalization increased access, such as Atlantic Canada and the Prairies. Twitter

A report by the Ottawa Hospital, the University of Ottawa and Ottawa's Bruyère Research Institute found the 260 REC stores across Canada (at the time of the research) were concentrated in low-income neighbourhoods.
Ottawa Citizen

  • Nearly twice as many REC stores were located in Canada's poorest neighbourhoods as in its wealthiest.
  • In many provinces—particularly Quebec—and municipalities, government officials have demanded REC retailers be located in undesirable neighbourhoods and away from well-traveled spots.
  • Private REC stores were also twice as close to schools as government-run stores, though all stores remained outside buffer-areas determined by government.
    CBC Ottawa

A survey from EY Canada and Lift & Co predicted 3M new consumers would enter the cannabis market with the launch of Legalization 2.0 products this fall.

  • Based on survey results, the authors predicted there would be 750,000 new consumers of extracts (3% of present-day non-consumers), 1.5M consumers of edibles (6% of non-consumers), and 2.25M new consumers of topicals (9% of non-consumers).
  • Authors believe many potential new customers will be seeking low-dose edible products.
    Canadian Manufacturing
  • The report says suspiciously little about extracts and vape pens, which insiders believe will become the most popular product compared with dry flower.

Quick Hits

  1. Pollster Dimitri Pantazopoulos launched a blog about cannabis numbers, beginning with this breakdown of the year's statistics.
    Margin of Error

  2. Numerous Canadian workplaces demand their employees not use cannabis at any time—including in their spare time. However, such strict policies are only legally applicable in safety-sensitive heavy industry. Calgary Herald



Tilray reported revenue of $45.9M (beating estimates of $40.3M), but posted a loss of $17.9M when analysts only expected losses of $14.4M.
Yahoo Finance

  • Tilray president and CEO Brendan Kennedy said that in a once-in-a-lifetime legalized industry emerging out of nothing, "if you want to dominate that global industry, you’d be constraining yourself if you were focused on profitability at this point."
  • Saying "Globally, now's the time to invest," Kennedy signalled his intention to continue building the corporation.

Quick Hits

  1. Cronos reported a Q2 2019 loss of $17.8M, even as net revenue spiked from $3.39M to $10.24M, quarter over quarter. Bloomberg

  2. Supreme Cannabis predicted its Q4 2019 revenue will increase 97% over the previous quarter, and 449% year over year. CEO Navdeep Dhaliwal said the green rush is over and the industry is at "an inflection point. We're entering a stage where people are really looking at… who's operating good businesses." Bloomberg

  3. Because early enthusiasm over acquisitions boosted prices, many LPs are carrying loads of goodwill (value applied to the company beyond that of its physical assets) that could lead to writedowns.



After promising and failing to make a statement last Thursday about its decision to raid a home and apartment in order to seize three plants spotted by an off-duty RCMP officer on a neighbourhood garden tour, the Revelstoke, BC detachment of the RCMP refused to comment further on the case.
Revelstoke Mountaineer

  • In a statement refusing to answer questions about the case, an RCMP representative said only, "This particular case serves as an excellent reminder to those members of the public who choose to cultivate, possess or consume cannabis to be mindful of the full legislation enacted in October 2018."
  • According to the search warrant, after spotting three plants in the garden of couple Anna Minten and Emmanuel Levesque Dupere, Constable Faron Ling returned to the scene to "[photograph] the property from a distance with a telephoto lens, while concealed by a forest across the street from the residence."
    Revelstoke Mountaineer
  • Both Anna Minten and BC Lawyer Paul Doroshenko expressed surprise police didn't simply knock on Minten and Dupere's door to ask about the plants before raiding the property.
  • Doroshenko predicted this case will eventually lead to a court decision clarifying BC's law about cannabis plants within "public view."

Quick Hits

  1. The 109th Grand Forks & District Fall Fair will add cannabis to the crops up for judging. Dried and cured buds will be considered based on their look, smell, and "how well they smoulder." Grand Forks Gazette

  2. After considerable delay, the BC Liquor Distribution Branch finally opened its call for LPs that wish to supply extracts, edibles/beverages, and topicals.
    CTV News



Nipissing First Nation Chief Scott McLeod said his Council supports the individual from his community who succeeded in applying for an Ontario REC retail license. However, the Chief said, "We don't necessarily support the idea that the province has jurisdiction in our First Nation lands. we're still pursuing the avenue of working out a bilateral agreement with the federal government so we can maintain jurisdiction and the creation of laws in our land."
CBC Sudbury

The government's new cannabis-possession records suspensions won't likely be much use in the North, say lawyers and academics. Though the records-suspensions themselves have no cost, they require hundreds of dollars in spending to order criminal records and other information, and Northern people are less likely to be able to afford that. As well, Northerners convicted of cannabis possession are usually also convicted of other crimes at the same time.
CBC North

After members of Chippewas of Nawash Unceded First Nation protested locally owned cannabis company Wiisag was licensed without proper consultation, the community's Band Council asked Health Canada to withhold a license for the facility. Health Canada agreed. Chief Greg Nadjiwon and his Council stressed they were not opposed to cannabis, but were opposed to Wiisag "for environmental and other reasons."
Owen Sound Sun Times


University of Calgary researchers—including former Degrassi-star Dr. Rebecca Haines-Saah—considered 1,047 studies related to cannabis and mental health to develop a report on how researchers should approach cannabis.

  • Historical cannabis research has tended to begin with the presumption cannabis caused mental health harms, and only two studies considered potential positive effects on mental health. Researchers will need to be open to the possibility of cannabis having therapeutic potential.
  • Lead author Dr. Fiona Clement said existing studies showed little detail about differences in how and why people use cannabis—but also little differentiation between negative mental health outcomes.
    CBC Calgary

Quick Hits

  1. After identifying major research delays caused by seemingly unreasonable Health Canada cannabis licensing demands, Aurora Chief Science Officer Jonathan Page reported Health Canada has "added staff to review Research licence apps, applied risk assessment to expedite some apps, and plan outreach to the cannabis research community this Fall. Overall we’re making progress." Twitter

  2. A study co-authored by a Montreal pediatrician found teens who vaped were three to four times more likely to use cannabis.
    The Star


Open Government Licence – Canada

Technically, only licensed REC retailers may sell CBD products—but unlicensed companies like illicit Toronto CBD-seller Calyx Wellness use lavish storefronts to appear to be operating within the law. Consumers seeking only CBD products for health and wellness may not understand the legality of products they're buying. Fortunately this week, Health Canada issued a long-awaited factsheet on CBD and its regulation in Canada. It includes the brass tacks of legality for a variety of CBD-related discussions.

Quick Hits

  1. Lawyer Trina Fraser warned Cannabis Act licensees and applicants not to neglect to get a license from Canada Revenue Agency. "If you start operations with no CRA licence this is a serious offence. CRA intends to start taking action in these cases. This will not slip through the cracks on their end. They get notice of new HC licensees and they follow up!"

  2. The Globe profiled the three (and only three) microcultivators who have been licensed by Health Canada since the program opened last October.
    Globe and Mail



MED activist and dispensary owner Chris Enns was charged with possession of cannabis for the purpose of selling, as well as for the production and distribution of illicit cannabis. He plans to challenge the constitutionality of MED access laws.
Global News

Quick Hits

  1. Former RCMP constable Jeffrey Meyers became the first individual to receive a Health Canada license for commercial medical sale. The former organized-crime investigator will broker deals between those inside the industry and with MED patients—he is not licensed to possess cannabis on site.

  2. The Financial Post profiled Aphria's return to the limelight, even as some of the accusations lobbed at the firm by short sellers last December continue to cast a shadow.
    Financial Post


Jesse Staniforth

Cannabis packaging remains a source of complaint across the country. For REC retailers and their customers, Health Canada's demand that consumers buy cannabis without being able to open, see, or smell it provides one more barrier to adopting legal REC.

  • On Reddit, Toronto REC users compared the amount of packaging left after one ounce of legal cannabis versus the child-proof, odor-sealed minimal packaging employed by illicit dispensary CAFE.

Quick Hits

  1. Andrea Dobbs, co-founder of Vancouver dispensary turned legal REC retailer Village Bloomery, called on LPs to find ways to differentiate more clearly between product packaging—such as using one colour but multiple textures, or different shades of the same colour.

  2. Newfoundland independent REC retailer Thomas H. Clarke—whose store THC Distribution made the first legal cannabis in Canada last fall—says that he's forced to buy cannabis from the provincial government at 8% less than he sells it for—and that's before excise taxes. Finance minister Tom Osborne said REC retailers knew how tight the margin would be when they were licensed, but the government is " more than willing to discuss what possibilities are there to make their operations more profitable."
    CBC Newfoundland