CannTrust (CTST) which is a leading Canadian Cannabis producer stated on Monday that thousands of Kgs of its weed have been placed on hold after the firm was found by regulators to growing cannabis in unlicensed rooms & the regulators got wrong information about the firm. The stock of CannTust fell suddenly on Monday whereas various other marijuana stocks retreated.
CannTrust stated that the action will lead to temporary product shortages to medical customers. The firm added that it was not sure how the regulatory actions would impact its financial results until the government finished quality testing of the product in a greenhouse facility in Ontario, where the regulators stated the violations occurred.
The Chief Executive Officer of CannTrust, Peter Aceto stated that we made errors in judgment, however, the lessons we have learned will be serving us well in moving forward.
CannTrust said it was looking at measures to address the shortages.
Health Canada, the agency of government which oversees licensing for Canada’s marijuana industry, is currently running quality tests on the samples of product which is held on. CannTrust said that the outcomes should come in within ten to twelve business days.
CannTrust said that Health Canada found that the firm was growing cannabis in 5 unlicensed rooms at the Pelham greenhouse. Employees gave inaccurate information to the agency.
The firm told that the growth in the unlicensed rooms took place from last year’s October through March. During that time period, the firm said that it had pending applications with Health Canada. Licenses for the rooms were finally issued in April.
A hold on inventory has been set by Health Canada that includes around 5,200 kilograms of dried cannabis that had been harvested in the unlicensed rooms.
The firm stated it had on purpose advised Health Canada of issues which might impact compliance at its Vaughan facility regarding product storage.