Health Canada took hundreds of pounds of cannabis from CannTrust Holdings Inc. ( TRST.TO ) after an inspection three years ago, and demonstrated a history of mismatch from a company that has been Pulled into the limelight this week for a bug that could cost Vaughan, Ont. its license to produce and sell cannabis in Canada.
The attack in February 2016 was due to one of a number of violations that Health Canada proved to have taken place over the past four years, according to a review of inspection findings described by the federal regulator. From April 201
The seizure of more than 377 kilos of pot took place after a targeted review by federal inspectors who found the company stored four times more cannabis in a security vault than it was licensed to hold, resulting in about $ 6 million of medical pot. was taken away by Health Canada.
"There have been some compliance issues previously with CannTrust," said Sherry Boodram, CEO of regulatory consulting firm CannDelta and a former enforcement officer with Health Canada, in an interview with BNN Bloomberg. "There are things Health Canada will take into account when trying to make a decision on enforcement."
Shares in CannTrust have lost about 40 percent of the value since entering a tailspin Monday when the company revealed that Health Canada decided to grow thousands of cannabis in unlicensed rooms at Pelham, Ont. The facility between October 2018 and March this year.
And late Wednesday, The Globe and Mail quoted a former CannTrust employee claiming that the company's employees installed false walls on the site to hide illegally grown cannabis to avoid detection during Health Canada inspections.
"It is clear that the main problem among investors at this time is whether Health Canada will look to set an example out of CannTrust and potentially pull the company's production license," said Derek Dley, an analyst with Canaccord Genuity, who slashed his price target on CannTrust's stock at $ 5 per share from $ 12 in a report on Thursday. "While we had originally seen this as very unlikely, we are now aware that this may be within the capabilities."
As a result of Health Canada's recent inspection, the regulator placed about 5,200 kilograms of cannabis in wait while the Company voluntarily placed an additional 7,500 kilograms produced on its Vaughan, Ont. the plant on hold until the survey is completed.
On the basis of BNN Bloomberg's review of an online inspection database, some of the other violations were found to be in violation of between 2015 and 2018, including storage vault security issues, growth room molds, and the absence of a traceability system needed to ensuring that the illegal pot was not sent to medical patients, a source who was directly familiar with the case said.
All problems were later addressed by the company under Health Canada's guidance, the source added. "width =" 5000 "class =" poll-image "src =" http://www.bnnbloomberg.ca/polopoly_fs/1.1285849.1562861309!/fileimage/httpImage/image.jpg_gen/derivatives/default/marijuana.jpg "/ >
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