What Happens to CannTrust?
If you’re not up to speed on the CannTrust debacle, stop reading now and go catch up. What started as reports that the company was growing in five unlicensed rooms, quickly morphed into something
much more serious. Allegations that the company took steps to actively conceal its conduct quickly surfaced, which led to the termination of CEO Peter Aceto and the resignation of Board Chair Eric Paul. Subsequent to that we learned that one of CannTrust’s other facilitates is not operating in a compliant manner, that the Ontario Cannabis store has shipped $2.9 million worth of product back to CannTrust, all while an additional 13,000kg remains in limbo after either being seized by Health Canada or voluntarily being put on hold. While we might not find out what sanctions the company will face until 2020, it feels like not a week can go by without some further development unfolding.
Ontario Retail 2.0
During the week of August 19, 2019, the Alcohol and Gaming Commission of Ontario will release the results from the second lottery draw for retail cannabis licenses. There are many unanswered questions at this time. Will existing retail brands be able to strengthen their reputation by owning or branding some of the new stores? Where will lottery winners elect to place their stores? How will the influx of 42 additional stores impact the revenue figures of the existing 24 stores? Will these 42 stores be able to open quicker than the first 24? These are all questions to which we will receive answers towards the end of 2019.
Ontario Retail 1.0
24 of the 25 potential stores have successfully opened as at the date of writing. Those stores become eligible for change of control in December, 2019. Will any of them change hands? Will any of them change brands?
New Product Launch
Edibles, extracts and concentrates all become legal on October 17, 2019, however we will have to wait 60 days past that point before we see these products on shelves. As such, we likely won’t have a full picture of what new product lines will be on offer until early 2020, but companies are already ramping up to hit the ground running. What products will be offered? What products will prove to be popular? What hiccups will companies face as they roll out these products?
Where are we going with Cannabis Health Products?
Back in June, the Canadian government launched a consultation to seek feedback from Canadians, as well as the cannabis and health products industries, regarding the kinds of products they would be interested in purchasing, manufacturing, or selling, should a legal pathway to market for cannabis health products be established. The consultation is set to close on September 3, 2019. Expect to get a hint of what is to come sometime between September, 2019 and the end of the year.
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