CannTrust shares plunge after Health Canada finds violations at second cannabis facility

CannTrust shares plunge again as Health Canada deems 2nd cannabis facility 'non-compliant'

CannTrust shares plunge again as Health Canada deems 2nd cannabis facility 'non-compliant'

Health Canada halted the sale of products from the company's facility in Pelham, Ont., near Niagara Falls, last month after it was revealed that the company was growing cannabis in five greenhouses within the 12-greenhouse facility that didn't have a license to operate at the time.

The regulator also said two new areas were constructed without prior approval and that security as well as quality assurance investigations were inadequate at the facility, while operating procedures did not to meet requirements.

Health Canada's probe could result in the suspension or termination of CannTrust's cannabis licences and fines up to $1 million.

Under the direction of the recently constituted independent Special Committee of the board of directors of the Company and newly-appointed interim CEO, Robert Marcovitch, the Company has already begun the process of investigating and remediating the root causes of any non-compliance and expects to propose a robust remediation plan to Health Canada.

Along with its licence, the fate of CannTrust's inventory is up in the air.

Watch CannTrust trade live on Markets Insider. The company produced 12,700 kilograms of cannabis, worth tens of millions of dollars, in the unlicensed rooms.

CannTrust continued to slide on Monday after Health Canada deals the company yet another blow. As far back as November, 2018 CannTrust officials had expressed concerns about regulatory breaches at its Vaughan facility.

"There are several points of exposure in our business we need to consider". Lee added, referring to rooms at the Vaughan facility. As of December 2018, 311 employees were working at the Vaughan facility, more than at its greenhouse in Pelham.

Health Canada has told CannTrust that it's unable to provide any guidance about the timing or content of its decisions regarding the company.

USA -listed shares of the Canadian grower, down 36 per cent in the past month after it suspended sales, fired its chief executive officer, disclosed a formal investigation by local regulators and said its results may have to be restated, fell another 26 per cent in early trading to $2.30. (NYSE:CTST) news were published by: Prnewswire.com which released: "CTST CLASS ACTION UPDATE: Hagens Berman Updates CannTrust (CTST) Investors, Encourages Investors Who Suffered $50,000+ Losses to Contact the Firm - PRNewswire" on July 15, 2019, also Globenewswire.com with their article: "Zhang Investor Law Reminds Investors of September 9 Deadline in Securities Class Action Lawsuit Against CannTrust Holdings Inc. â€" CTST - GlobeNewswire" published on August 07, 2019, Fool.ca published: "Is This Cannabis Stock a Better Buy Than Canopy Growth Corp (TSX:WEED)?

Notícias recomendadas

We are pleased to provide this opportunity to share information, experiences and observations about what's in the news.
Some of the comments may be reprinted elsewhere in the site or in the newspaper.
Thank you for taking the time to offer your thoughts.