In yet another week packed with cannabis news, we saw Aleafia Health Inc. (OTC: ALEAF) terminate a cannabis supply agreement with Aphria (NYSE: APHA) subsidiary Emblem Corp. after it said the latter failed to provide Aleafia with the equivalent of 175,000 kg in cannabis products. Aphria said it had “every intention” of fulfilling its obligations.
MedMen Enterprises Inc (OTC: MMNFF) announced Tuesday it has terminated a deal to acquire multistate cannabis operator Pharmacann. The company is also terminating its Chief Financial Officer Michael Kramer. See Benzinga Cannabis’ exclusive conversation with CEO Adam Bierman here.
The CEO also took time to respond to South Park’s brutal parody, noting he was humbled to be considered what he said is “the most culturally relevant cannabis brand on the planet.”
Apple Inc. (NASDAQ: AAPL) removed Berner-backed Social Club app from its App Store, alleging the platform had became a hub for illegal content; Tilray Inc (NASDAQ: TLRY) and Anheuser-Busch InBev NV (NYSE: BUD) announced a joint venture aimed at commercializing non-alcoholic, CBD-infused beverages in Canada; and Aurora Cannabis Inc. (NYSE: ACB) and CTT Pharmaceutical Holdings (OTC: CTTH) announced the launch of a product line of cannabinoid-infused sublingual wafers.
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Finally, we saw HEXO Corp (NYSE: HEXO) post preliminary financial results for the fiscal fourth quarter, with expected net revenue of CA$14.5 million ($10.9 million) to CA$16.5 million ($12.5 million), way below analysts expectations for CA$24.8 million.
The company also withdrew its financial outlook for fiscal 2020, projecting net revenue for the year of around CA$46.5 million to CA$48.5 million. The company also said Chief Financial Officer Michael Monahan is resigning, citing family reasons.
“The cannabis carnage continues as more cannabis companies find themselves either cutting back on lofty estimates or coming clean to the marketplace about their true financial situation,” Green Market Report CEO Debra Borchardt told Benzinga.
“MedMen decided against the PharmaCann acquisition, which was the basis for its huge projected proforma revenue numbers, while HEXO had to dial down its overly optimistic revenue forecast. Shareholders took out the anger with sell tickets, and I expect this is the beginning of more announcements like this.”
In some positive news, reports out of Mexico signaled a potential legalization of recreational cannabis, while Argentina saw its first major cannabis-related conference, attended by 56,000 people — 30% of whom were 60 or older.
The good news out of Mexico was short-lived. Not long after Ricardo Monreal, the Senate leader of Mexico’s ruling party MORENA, announced that a vote on adult-use marijuana legalization would occur by the end of October, Mexican President Andrés López Manuel Obrador said the move isn’t on his political agenda.
Cannabis ETFs delivered big losses. Over the last five trading days:
- The Horizons Marijuana Life Sciences Index ETF (OTC: HMLSF) (TSE:HMMJ) lost 13.64%.
- The ETFMG Alternative Harvest ETF (NYSE: MJ) tumbled 10.78%.
- The AdvisorShares Pure Cannabis ETF (NYSE: YOLO) was down 10.59%.
- The Cannabis ETF (NYSE: THCX) dove 10.65%.
- The Amplify Seymour Cannabis ETF (NYSE: CNBS) decreased by 10.33%.
- The SPDR S&P 500 ETF Trust (NYSE: SPY) closed the period up 0.68%.
More News From The Week
In other interesting news, gen!us launched The Original Jack Herer strain for brains in partnership with the estate of the legendary Jack Herer.
A team of experienced executives from asset management, advertising, branding, supply chain operations and cannabis teamed up to launch NEO Alternatives, a new hemp-derived CBD and cannabis company.
The company says will follow a “seed to store” ethos across each of its distinct brands, which it will start introducing to the marketplace in the coming weeks.
“Brand power is vital to success in the cannabis and CBD categories. Our mission is to distinguish ourselves by producing superlative brands that are clearly differentiated from the competition, and on top of that to ensure that the products themselves are of the highest quality, something consumers are spending more time thinking about as they survey the ever broadening range of products coming to market,” NEO Alternatives CEO Adam Patti, who most recently built the Exchange Traded Fund firm IndexIQ into a multibillion-dollar organization, told Benzinga.
TerrAscend Corp. (OTC: TRSSF) announced Monday that it has obtained Health Canada approval for expansion of its Mississauga, Ontario facility.
Halo Labs Inc. (OTC: AGEEF) signed an agreement to purchase all common shares of Cannpos Services Corp. As per the agreement, the company will acquire Cannpos’ shares for CA$4.69 million in Halo common shares at a price of CA$0.26 per share and 1.25 million performance warrants for the purchase of 1.25 million Halo common shares.
Additionally, Halo announced a simultaneous non-brokered private placement of its common shares as a condition to closing the acquisition. The common shares are set to a price of CA$0.31 per share for aggregate gross proceeds of up to CA$3 million.
From The Earth said it will expand into the Michigan market with its first provisioning center by the end of October. The center will move into adult recreational retail in January 2020 to address the growing market.
The newly constructed center specializes in personalized experiences for each cannabis consumer by helping customers learn about cannabis, live with the benefits and grow as individuals. Headquartered in Los Angeles, California, From The Earth owns and operates licensed facilities in cultivation, manufacturing, distribution and retail.
“We are pleased to expand From The Earth’s footprint into Michigan, one of the most restrictive regulatory agencies in the country,” From The Earth CEO Dan Zaharoni.
“We’ve become experts in the regulatory process for recreational cannabis and have a deep understanding of what cannabis consumers want, so we are excited to utilize this knowledge in the state of Michigan.”
Cannabis company Viola closed a $16-million funding round led by Gotham Green Partners.
Reflecting its position as a rapidly growing, global well-being company and reaffirming its commitment to improving quality of life through the benefits of cannabinoids, Surterra Wellness announced it has changed its corporate name to Parallel effective immediately.
More than 1,000 confirmed probable cases of vaping-related illness have been reported in the U.S., but there has been little public discussion about how smoking and vaping rates affect marginalized populations including those who identify as LGBTQ, people living with HIV/AIDS and individuals involved in the criminal justice system — whose …