Canada cannabis licensing inspections delayed due to COVID-19, CannTrust says

Health Canada is slowing down on-site field inspections of cannabis facilities until the end of the month amid the COVID-19 pandemic, according to a disclosure from beleaguered cannabis producer CannTrust.

Reduced field inspections could slow the pace at which the federal marijuana production regulator issues new licenses and amendments, presenting a new challenge to Canadian cannabis producers already grappling with the unexpected effects of the coronavirus.

CannTrust made the announcement in a news release issued after the financial markets closed Monday.

“As a precautionary measure for the health and safety of its employees and the community, Health Canada’s Cannabis Directorate is reducing on-site field inspection activities until at least March 31, 2020,” according to the release.

CannTrust is awaiting Health Canada’s decision to reinstate cannabis licenses at the company’s Ontario facilities, which were suspended after the company was caught growing cannabis in unlicensed areas.

“Health Canada’s response to the COVID-19 pandemic could adversely affect the timing of the company’s remediation efforts,” CannTrust warned.

Health Canada has not responded to Marijuana Business Daily inquiries about potential delays to cannabis licensing activity as a result of the pandemic.

A slowdown in the regulator’s on-site field inspections is unsurprising, said Lucas McCann, a former Health Canada employee who is now a regulatory expert with cannabis licensing consultancy CannDelta.

“Health Canada’s mandate is, No. 1, to protect the safety of Canadians and contribute to the betterment of society,” McCann said. “And in this kind of pandemic, an on-site inspection would potentially be putting agents at risk.”

McCann said CannDelta, which represents applicants for federal permits, has found that applications are still moving forward during the ongoing COVID-19 upheaval, albeit at a slower pace.

“Correspondences are taking a little bit more time. And there are a lot of folks that are working remotely as well,” he said.

“So things are moving in a positive direction, although we expect things to move a little bit slower.”

For cannabis producers seeking new licenses or amendments from Health Canada, McCann advised patience.

“It does represent a little bit of an inconvenience, but I think it’s for a very good purpose,” he said.

“I would suspect that those that are (undergoing) application review for a new license will still continue to move forward at a relatively reasonable pace.

“Some on-site inspections for folks looking to amend their licenses, to add additional rooms or to get a sales license to be able to move product more quickly, some of those may see more substantial delays.”

McCann noted that Ontario cannabis producers have been designated essential workplaces by the Ontario government.

“As such, it’ll probably be necessary for Health Canada, at least the regional offices, I would think, to support those activities to some extent,” he said.

CannTrust’s shares trade on the Toronto and New York stock exchanges.

Solomon Israel is a reporter for Marijuana Business Daily, based in Winnipeg. He can be reached at [email protected]

For more of Marijuana Business Daily’s ongoing coverage of the coronavirus pandemic and its effects on the cannabis industry, click here.

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