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Cannabis Troubles Continue

Cannabis-related businesses continue to struggle. Last week Destiny Bioscience Global Corp., an Alberta research and development company focused on the genetics and cultivation of cannabis, was placed in receivership by its main lender. Link here to the receiver’s webpage: Destiny Bioscience Global Corp.

The previous week, the GGB group of companies, a Toronto-based enterprise licensed to cultivate and sell cannabis in the United States, was granted creditor protection under the Companies’ Creditors Arrangement Act. Link here to the monitor’s webpage: Green Growth Brands Inc., GGB Canada Inc., Green Growth Brands Realty Ltd. and Xanthic Biopharma Limited.

Although the economic disruption cause by the COVID-19 pandemic has certainly created additional headwinds for cannabis businesses, many such businesses were struggling even before the pandemic. Cannabis’ journey from black market outlaw to mature industry may end up being a textbook example of irrational exuberance getting ahead of sober financial and investment analysis.

For all stakeholders, including suppliers, landlords, employees and other creditors, informed advice on responding to these challenges is crucial.

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