New York’s unlicensed dispensaries warned to close
Cannabis shops suspected of participating in “illegal gifting” of THC products pre-legalized sales in New York have received cease-and-desist letters from the State’s Office of Cannabis Management, reports Cannabis Business Times.
“You are hereby directed to cease any, and all, illegal activity immediately,” the letter states. “Failure to cease this activity puts your ability to obtain a license in the legal cannabis market at substantial risk. The unlicensed sale of cannabis is illegal and subjects you to substantial fines and possible criminal penalties.”
New York will likely have to continue grappling with entrepreneurs aiming to establish loyalty among consumers until sales licenses are issued—which won’t be until 2023 at the earliest.
Enjoy Cannabis Daily each morning at 7 a.m.
HEXO downsizes in wake of Nasdaq warning
A week after being warned for being in non-compliance by NASDAQ after their stock dropped below $1 for 30 consecutive days, formerly-Quebec-based Hexo Corp. announced it will lay off 180 employees to save approximately $15 million this year, reports BNN Bloomberg.
The cost-cutting plan has been dubbed ‘A Path Forward’
- And includes the closure of its Nova Scotia production facility (which accounts for about half of the layoffs)
- Is estimated to generate $37.5 million this fiscal year in new cash flow and approximately $135 million in the next fiscal year
- Is intended to help make good on its USD $360 million debt financing deal with New Jersey-based hedge fund High Trail Capital LP, used to acquire Redecan in 2021
To add to HEXO’s challenges, activist investor and former Redecan advisor Adam Arviv is planning to nominate five independent directors and push for new leadership of the company at an upcoming shareholders meeting. (On the other hand, HEXO has the largest percentage of market share in Canada – at just over 10%.)
LET’S GET ON WITH IT
US federal reform updates
The push for federal cannabis reform is slow-going, but never boring. A few recent updates:
- Senate Minority Leader Mitch McConnell criticized the inclusion of the SAFE banking bill in the America COMPETES Act, calling it “a poison pill” (Marijuana Moment)
- Senate Majority Leader Chuck Schumer announced he will file his legalization bill in April (Marijuana Moment)
- The hemp industry is anticipating on a crackdown on THC product sales, which are reportedly booming (MJBizDaily)
It’s never a dull moment when you mix politics and cannabis in Washington, DC – but as we inch closer to the midterm elections, don’t expect major, sweeping changes from the federal government.
THE NEXT BIG MARKET?
One year in, a look back on Europe’s cannabis stocks
It’s been one year since the first cannabis stock was listed on the London Stock Exchange, so BusinessCann evaluated market reaction to some of the industry’s major players’ progress thus far:
- Love Hemp Group jumped 60% last week to 1.23p, but is still well below its high of more than 8p
- The market also reacted positively to Oxford Cannabinoid Technologies’ recent appointment of Imperial Brands director Richard Guy Hathaway, bumping its price by about 7%
- Cellular Goods is planning to revamp its marketing efforts to boost its flat stock performance
- Chill Brands is struggling this past week after delaying its ambitious US-focused retail rollout plans
- MGC is also struggling despite its positive revenue growth due to delayed trials for Cognicann to treat Dementia and Alzheimer’s
See a more comprehensive list of EU cannabis stock performance at BusinessCann.