Health Canada suspends British Columbia cannabis producer Evergreen’s licenses

(This story has been corrected to reflect that CannTrust’s license has not been suspended.)

Another cannabis company has been penalized by Health Canada for alleged regulatory violations.

British Columbia-based Evergreen Medicinal Supply was sanctioned Aug. 9 over noncompliance with federal law and regulations, according to Health Canada, which did not list the licenses as “suspended” on its website until last week.

It was the first suspension the regulator handed down since Ontario’s CannTrust was found to be noncompliant in July for unlicensed cultivation.

The enforcement action against Evergreen stems from an unannounced inspection on April 29, according to Health Canada.

The inspection resulted in “critical observations” and an overall rating of noncompliance for infractions related to good production practices, record keeping, inventory control and adherence to license controls, the federal government’s cannabis regulator told Marijuana Business Daily.

“Health Canada suspended Evergreen Medicinal Supply Inc.’s licenses to protect public health and safety, including preventing cannabis from being diverted to the illegal market, as a result of noncompliance with certain provisions of the Cannabis Act and Cannabis Regulations,” a Health Canada spokesperson said in an email.

On Sept. 9, Evergreen provided Health Canada with a response to the suspension.

The company is “working on corrective actions,” according to the regulator, which promised to thoroughly review and consider the information provided in its ongoing decision-making process.

Evergreen did not respond to media queries over the weekend.

Before the suspension, the Victoria headquartered company was authorized to cultivate, process and sell dried and fresh cannabis, plants and seeds to provincial wholesalers and directly to authorized patients.

However, Evergreen sold cannabis exclusively to other licence holders prior to the suspension, Health Canada said.

‘Pockets of noncompliance’

David Hyde, president of the security and compliance company 3|Sixty Secure, said Health Canada is honing in on pockets of risk.

“I think overall we’re entering into a period where Health Canada is going to be sensitive to the level of compliance and alignment with the regulations across all the producers, given that the numbers have increased so significantly,” he said.

There are well over 200 federal cannabis license holders in Canada, up from 50 two years ago.

“As we enter into the more complex issue of different product formulations and new product types, and an increase in transportation of cannabis products around Canada, I think we’re going to see a more sensitive eye on compliance,” he said.

“We’re going to see more action on pockets of noncompliance.”

In a statement, Health Canada said it will continue to undertake inspections of cannabis licence holders to ensure compliance with the law and regulations, “and the integrity of Canada’s legal cannabis production system.”

“This enforcement action reinforces the importance of Health Canada’s inspections of cannabis licence holders to identify non-compliance and to protect the integrity of Canada’s legal cannabis production system,” the health department said.

It’s not Evergreen’s first run in with inspectors.

The company earned two “major” observations after inspections in October and December 2017, respectively.

The company was deemed compliant with regulations on both occasions.

Matt Lamers can be reached at [email protected]

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