Cannabis Companies Brace for Coronavirus Impact

Editor’s note: this story will be updated with developments.

The cannabis industry, like other industries, has been upended as the coronavirus (COVID-19) pandemic worsens. Events have been cancelled. Consumers are stocking up on flower and products. And on Tuesday, one of the largest cannabis companies in the world, Canopy Growth, announced that it would temporarily close nearly two dozen corporate-owned retail shops in Canada. 

“We have a responsibility to our employees, their families, and our communities to do our part to ‘flatten the curve’ by limiting social interactions. For us, that means shifting our focus from retail to e-commerce,” Canopy Growth CEO David Klein said in a statement. 

This move puts a spotlight on an early question that cannabis business owners are wrestling with: to close or not to close? 

Considering that Canada allows for e-commerce, the impact of this “shift in focus” on companies like Canopy is smaller than it would be for a U.S. company. In the U.S., a company would need to hire or expand delivery staff because, unlike in Canada, the postal system in the US is off-limits due to federal prohibition. Also, not all states allow for cannabis delivery to begin with. 

There’s also the potential for forced closure. In the U.S., rules related to containment of coronavirus are rapidly evolving, as are restrictions. More than a dozen governors have ordered hospitality establishments closed outside of take away orders. And in the San Francisco Bay Area in California, where medical and adult use cannabis is legal, a shelter-in-place policy means that residents are barred from leaving their homes unless it’s for an “essential” reason, like going to the doctor or grocery store. 

Some cannabis businesses are likely to be considered less “essential” than others. So far, there are only a few legal cannabis consumption spaces in the U.S., but one of the first, called The Coffee Joint, went the way of bars and restaurants: closed.

“The only change in Denver so far is that the one licensed cannabis consumption facility has been ordered to temporarily close under the public health order,” Eric Escudero, the director of communications for Denver’s department of excise and licenses, told Cannabis Wire

When it comes to medical cannabis, while businesses serving patients face a unique challenge because some of those people visiting storefronts could be immunocompromised and at a heightened risk of illness, as of Tuesday evening state regulators contacted by Cannabis Wire appear to be taking the position that medical cannabis shops are “essential.”

As Nate Wardle, the press secretary for the Pennsylvania Department of Health, put it to Cannabis Wire, “In Pennsylvania, medical marijuana dispensaries are considered the same as pharmacies, and so they are considered essential during this time of non-essential retail being shut down to mitigate and increase social distancing.” (Delivery is not allowed in Pennsylvania.)

On Tuesday evening, San Francisco’s Department of Public Health tweeted, “Cannabis is an essential medicine for many San Francisco residents. Dispensaries can continue to operate as essential businesses during this time.” And the Washington State Liquor and Cannabis Board announced that cannabis businesses could also offer “curbside service” for patients.

The question of closure is only one of the many dilemmas that will inevitably confront the cannabis industry, so Cannabis Wire asked some of the largest companies in the world what operational changes, closures or otherwise, are in the works because of COVID-19.

This is what some of them had to say (we will be updating with new responses): 

Acreage Holdings (Howard Schacter, VP of communications)

New York-based company with operations across the US.

“We don’t have anything to share at this time.”  

Aurora Cannabis (Michelle Lefler, VP of communications)

Canadian company with operations across the world (no retail in Canada)

“Our production facilities remain fully operational and we have not experienced any disruptions to regular operations, including our existing supply chain. We recognize that the situation is evolving and will continue to assess daily. 

We have responsibly activated our crisis preparedness program and are monitoring developments and risk assessments issued by international and Canadian public health authorities. At this time, we have paused all business travel and have advised staff to defer personal travel, which we are carefully monitoring. Employees are being provided the option to work from home as per the social distancing procedures advised by the World Health Organization.”

Charlotte’s Web (Deanie Elsner, CEO)

Colorado-based company with hemp and CBD operations in Colorado, Oregon, and Kentucky.

“We are choosing to close our pop up shops in Denver and Miami. We have implemented social distancing through a remote working policy. … We feel confident that we will continue to supply and ship to meet the demand of our most vulnerable consumers. We will continue to monitor the situation and will take actions that we determine are in the best interests of our employees, customers, partners, suppliers, and stakeholders.”

Curaleaf (Tracy Brady, VP of corporate communications)

Massachusetts-based company with operations across the US.

“Right now our dispensaries remain open to serve patients but we are closely monitoring guidelines and regulations in each state, as the situation continues to evolve rapidly. We are making changes and adjustments state by state as soon as we can implement them; for example, we are encouraging mobile ordering and express pickup and delivery in the markets where those services are available, and where they aren’t we are working to determine if we can make those services available; we are also working on making adjustments to our retail facilities (open hours, appointment ordering and pickup and limiting number of patients in waiting areas, staffing two teams, etc.).”

Harvest Health & Recreation (Alex Howe, head of corporate communications)

Arizona-based company with operations across the US.

“Across the country, local and state governments have determined that all medical support and essential service providers like Harvest should remain open to best support patients through this trying time. As a medical provider to patients who rely on our products to treat various conditions we have made the decision to continue serving in this time of need.”

The company has “taken a number of steps to help protect our patients and employees during the Covid-19 outbreak,” including allowing employees who might have been exposed to “utilize work from home options when available, Paid Time Off and other benefit policies to assist with sustaining their incomes,” and requiring “all employees avoid nonessential business travel and all travel to countries designated high risk by the CDC.”

As for “assisting with social distancing/e-commerce,” the company is “evaluating the minimum number of employees to safely and securely staff our facilities, ramping up online, curbside delivery, pre-order and delivery options, limiting the number of visitors in each store at one time and shifted a significant number of employees to work from home.”

iAnthus (Carrie Booze, spokesperson)

New York-based company with operations across the US.

“In the regions where iAnthus operates, their dispensaries are designated as ‘essential’ businesses. Therefore, they’re obligated to remain open to provide our patients safe access to their medicine.”

The company has also “modified hours of operation,” is “pushing to online/phone ordering & express pickup and/or delivery,” and is “limiting the number of patients allowed instore.”

MedMen (Christian Langbein, VP of communications)

California-based company with operations across the US.

Early Tuesday, the company’s response was: “We are working as we speak on an evaluation of our retail operations in light of recent developments surrounding COVID-19.” 

By close of business, the following update: “As of right now, all MedMen retail stores remain open and delivery service is active within the applicable markets. We are closely following guidelines from the CDC and World Health Organization in the best interest of our customers and employees and have adopted the recommended safety protocol at retail and for delivery.”

Organigram Inc. (Ray Gracewood, SVP of marketing and communications)

Canadian company with operations across the world (no retail in Canada)

“In terms of business impact, Organigram is taking several steps internally to offer options to employees for roles that can be managed from independent workspaces; the company is also reviewing its business continuity plan to proactively scenario-plan for instances that could have an impact on our production environment, supply chain or sales channels. We’ve also prioritized fulfillment of our medical channel, as we’ve seen some significant growth recently on patient orders.”

Trulieve (Tim Morey, chief sales officer)

Florida-based company with operations in a handful of states.

“At this time, Trulieve’s dispensaries are currently open and operating under normal business hours. We have been monitoring the COVID-19 situation closely, especially as we provide access to medications for a large number of patients and customers. Our team quickly instituted initiatives to help protect our dedicated Trulievers and our staff during this coronavirus pandemic, including revamped employee sick leave policies, new dispensary cleaning procedures and access to hand sanitizers for our patients, free home deliveries for patients 65 and older, and increased production to keep our stores supplied.”

More Cannabis Companies Brace for Coronavirus Impact