Cannabis Professional’s daily roundup of industry news. View archive here.
Health Canada issued a warning about vape devices on Wednesday evening, following an outbreak of respiratory illnesses in the U.S. with possible links to vaping. WeedMD announced a $10-million convertible debenture bought deal. BMO analysts upgraded their rating for Cronos although kept their price target the same, following a drop in the Cronos’ share price in recent months. Aphria said on Thursday that it is joining the cannabis verification program run by TruTrace and Shoppers Drug Mart.
– Mark Rendell
Health Canada asks vape users to ‘monitor themselves’ in wake of U.S. outbreak
Health Canada is asking Canadians who use vaping products to “to monitor themselves for symptoms of pulmonary illness (e.g., cough, shortness of breath, chest pain) and to seek medical attention promptly if they have concerns about their health.”
The department released an “information update” on Wednesday evening, in the wake of an outbreak of respiratory illnesses in the United States potentially linked to vaping, and a warning on Friday from the U.S. Centers for Disease Control and Prevention (CBC).
As of August 27, 215 cases of pulmonary illness with possible links to vaping had been reported from 25 states, according to the CDC. One person reportedly died after using an e-cigarette product, and another death is under investigation.
“To date, the Government of Canada has not seen any evidence of similar pulmonary illnesses occurring in Canada. Health Canada and the Public Health Agency of Canada are in close contact with the US FDA and the US CDC to better understand their investigation into the cause of the illnesses,” Health Canada said in the update.
Health Canada has asked provincial and territorial health officers to report any illnesses with possible links to vaping, and issued a reminder to health care professionals, “to always ask patients, as part of their general history, whether they use drugs from any source, whether legal or illegal.”
“Vaping is not without risk, and the potential long-term effects of vaping remain unknown. Non-smokers, people who are pregnant and young people should not vape,” Health Canada said.
“Canadians are reminded that the purchase of vaping products outside the legal market may create additional risk as these products are unregulated and potentially unsafe, and thereby pose a risk to health and safety.”
WeedMD announces $10-million bought deal
WeedMD Inc. is looking to raise $10-million in a bought deal underwritten by Mackie Research Capital Corp. and Haywood Securities, the company said on Wednesday.
WeedMD will issue 10,000 convertible debentures units, each comprising of an $1000 debenture bearing 8.5 per cent interest and convertible at $1.60, as well as 625 share purchase warrants with an exercise price of $1.80.
“The net proceeds from the Offering will be used for working capital and general corporate purposes,” the company said. The offering is expected to close in the week of September 25, subject to necessary regulatory approvals.
BMO analysts upgrade Cronos to ‘market perform’ after share price drop
Bank of Montreal analysts Tamy Chen and Peter Sklar have upgraded their Cronos Group Inc. rating to “market perform,” following a sharp sell-off in Cronos shares over the past few months.
“Cronos is now trading at 13x our 2020E revenues, which is largely in line with the valuations of other large, publicly traded LPs. We are neutral on the stock as we continue to believe the company's production and rec sales volumes are somewhat behind some of the other LPs,” wrote Ms. Chen and Mr. Sklar in a note on Wednesday.
The analysts maintained their price target of $16.
“In addition, while we believe Cronos’ investment in the vape pen category and strategic partnership with Altria (MO-NYSE; not rated) should provide a differentiated offering of proprietary vape oil formulations and hardware, we believe there remains significant industry uncertainty in the timing of value-add product roll-outs and that initial ramp costs to manufacture these formats could pressure margins,” the analysts wrote.
Aphria joins Shoppers cannabis verification program
Aphria Inc. said on Thursday that it has joined the cannabis verification program run by TruTrace Technologies Inc. and Shoppers Drug Mart.
As the news release explained: “Under the StrainSecure program, the TruTrace team collects plant testing data and performs genomic verification in plant batches which are then registered in a blockchain-enabled database for intellectual property protection and strain validation. All information gathered from the plants, including their molecular and chemical makeup, can be tracked via the program.”
Jameson Berkow explained the idea behind the program when it launched back in June.