The coronavirus pandemic has affected the cannabis and psychedelics industries in many different ways — some more negative than others.
While we continue to see massive layoffs, management shakeups and event cancellations across the board, businesses are struggling to adapt to their new situations, offering delivery services, free access to virtual platforms and more.
Many cities have declared quarantines, but deemed dispensaries as essential services, allowing them to continue to operate under certain guidelines and limitations.
“The COVID-19 virus has affected everyone’s normal way of doing business. Cannabis companies are more accustomed than most to pivot and pivot hard when things change overnight,” Green Market Report CEO Debra Borchardt told Benzinga.
“Delivery services have increased, curbside options have begun and many dispensaries have vowed to remain open at some level. Sales are robust at most as the stress of this situation has caused many consumers to need cannabis to reduce anxiety or at least make the quarantine period a little more tolerable.”
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Khiron Life Sciences Corp (OTC: KHRNF) announced good news from Colombia: it has received an authorization to start manufacturing cannabis-containing medicines, becoming the first company operating in the country to do so. Khiron said it expects to start filling prescriptions in the next few days.
Cannabis ETFs were once again in the red. Over the last five trading days:
The Cannabis ETF (NYSE: THCX) dropped 0.4%.
The Amplify Seymour Cannabis ETF (NYSE: CNBS) shed 3.2%.
The SPDR S&P 500 ETF Trust (NYSE: SPY) closed the period down 15%.
Back in the U.S., Massachusetts witnessed an uptick in cannabis prices driven by high demand in a limited supply context.
In the psychedelics world, Mindbloom said it has made its ketamine treatment available to New Yorkers in a fully remote format. More about how this works here.
More Cannabis News From The Week
Cantor Fitzgerald analyst Pablo Zuanic slashed the sell-side firm’s Tilray Inc (NASDAQ: TLRY) price target in the wake of Canada-based company’s pricing of a $90.4-million equity offering. Zuanic maintained a Neutral rating on Tilray and lowered the price target from $17.50 to $4.90.
While Zuanic said he understands the need to raise funds, he was surprised Tilray would choose “the worst of times” to price the offering. The analyst weighed whether other cannabis companies will follow suit, and said that in the case of Aurora Cannabis (NYSE: ACB), the company is likely to rely on cost cuts, positive EBITDA and lower capex to get by.
“The boom and bust in Canadian cannabis stocks has scared away a good number of investors,” Zuanic said, adding that Cantor is comfortable with underlying trends.
Zuanic also maintained an Overweight rating on CV Sciences Inc (OTC: CVSI), but reduced his price target from $1.60 to 80 cents, following fourth-quarter results that fell short of expectations.
CanaFarma Hemp Products signed a lease for 100 acres of farmland in Cato, New York, almost doubling the acreage the company had in 2019.
In 2019, CanaFarma Hemp worked a 55-acre farm in New York and delivered 128,000 pounds of hemp biomass, achieving a yield of over 2,300 pounds per acre. That’s 50% better than the average farm yield, which CanaFarma said is in the range of 1,500 pounds per acre.
Cannabis distribution company SparqOne entered distribution agreements with cannabis brands Kushy Punch, Church, Mindset Organics, Branded and Smoakland.
“The SparqOne team is excited to be joining forces with such renowned cannabis brands and we are looking forward to bolstering the product lineup for our dispensary partners. We have a strong relationship with almost every dispensary in the state and we can attribute that to our customer service, highly advanced logistics and dedication to next-day delivery no matter how large the order or how far the dispensary,” said Andrew Dorsett, general manager of SparqOne.
AXIM Biotechnologies (OTC: AXIM), an international health care solutions company targeting oncological and cannabinoid research, announced the full acquisition of leading oncology R&D company Sapphire Biotech, Inc. As part of the deal, AXIM has acquired 100% of the capital stock of Sapphire and will operate the company as a wholly owned subsidiary led by CEO Catalina Valencia.
“Through this acquisition, AXIM expands its historically cannabinoid-based research to include a focus in oncology,” said John W. Huemoeller II, CEO of AXIM Biotech. “Sapphire was attractive to us because of its renowned research team, impressive discoveries in the field of oncology, and impressive IP portfolio.”
Nabis Holdings Inc. (OTC: NABIF)(CSE: NAB) cancelled an agreement to acquire Desert’s Finest dispensary in California.
“Given the downturn in the cannabis industry, capital markets are no longer helping fuel growth, resulting in the company narrowing their focus on acquiring assets that fit into our vertically integrated strategy,” Nabis CEO Shay Shnet said in a statement. “Although the Desert’s Finest acquisition was a great opportunity for us to enter the California cannabis market, acquiring a standalone dispensary no longer fits into our strategic plan.”
HEXO Corp. (NYSE: HEXO) said it has not met the deadline for filing its interim financial statements for its fiscal second quarter because of several unexpected circumstances, such as having a huge impairment loss in the quarter, with the final amount still to be calculated. Until the filings are submitted, Hexo will hold a blackout on trading by directors, officers and remaining insiders of the company.
It has revealed some financial results for the quarter, including net revenue of $17 million, compared to $14.5 million in the previous quarter, and gross revenue of $23.8 million versus $19.3 million in the first quarter.
Canopy Growth (NYSE: CGC) decided to temporarily stop operating all corporate-owned Tokyo Smoke and Tweed retail stores across Canada, respecting the advice provided by various health bodies concerning the COVID-19 outbreak.
“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,” said Canopy Growth CEO David Klein.
Medicine Man Technologies Inc. (OTC: MDCL) appointed Nirup Krishnamurthy to the role of chief integration and information officer.
Cannabis industry veteran Joe Hodas joined Wana Brands as chief marketing officer.
Aleafia Health Inc. (OTC: ALEAF) reported a surge in fiscal year 2019 and fourth-quarter revenue. The Canadian company said that its fourth-quarter net revenue of $6 million represents a 22% quarter-over-quarter increase.
For full fiscal 2019, Aleafia posted net revenue of $16.4 million, 391% higher than in fiscal 2018. The revenue rise was mainly driven by an increase in net cannabis revenue of $11 million and $2 million in clinic revenue, the company said.
For the quarter, Aleafia disclosed a net loss of $9.8 million versus net income of $1.9 million in the prior quarter. The company also reached its first quarterly positive adjusted EBITDA of $200,000 versus a loss of $2.5 million in the previous quarter.
Crescita Therapeutics Inc. (TSX: CTX) (OTC: CRRTF) disclosed its fourth quarter and fiscal 2019 financial results. The Mississauga-based company reported annual record revenue of CA$22.34 million ($15.52 million), up by 34.3% from the previous year. Quarterly revenue of CA$3.82 million was down by 38.4% from the same period in the prior year.
Sproutways, an open marketplace for cannabis genetics, is teaming up with greenhouse operator Wave Rider Nursery and Santa Cruz Naturals. The agreement between Sproutways, Monterey Bay-based Wave Rider and the Santa Cruz County dispensary aims to provide streamlined access to METRC-compliant seeds, clones and flowers.
Greenhouse operator Village Farms International (NASDAQ: VFF) (TSX: VFF) received an infusion of CA$10 million ($6.92 million) in capital thanks to a deal with Beacon Securities Ltd. The deal, announced Thursday, calls for the purchase of 3,125,000 common shares in Village Farms at CA$3.20 per share.
Green Growth Brands (CSE: GGB) (OTC: GGBXF) announced that Peter Horvath resigned as CEO and as a member of the board of directors. Horvath had served as CEO of Green Growth since early 2019 and joined the board in mid-2018.
COO Randy Whitaker was named as Green Growth’s interim CEO.
Harvest One Cannabis (TSE: HVT) (OTC: HRVOF) appointed CCO Andy Bayfield to the position of interim CEO, effective immediately. Bayfield will also be appointed to the company’s board of directors. Frank Holler was also appointed as executive chairman.
The company has accepted the resignation of former CEO Grant Froese from his executive position and from the board of directors.
As COVID-19 spreads around the globe, we’re seeing an increasing number of hospitals and clinics that are not adequately prepared for the surge in patients looking to see a doctor. During this crisis, Heally is making its digital patient platform available to any physician’s office to use at no charge.
For patients, it costs $39.
Top Stories Of The Week
Check out the top stories on Benzinga Cannabis this week:
Check out these and many other cannabis stories on Benzinga.com/cannabis
Lead image by Ilona Szentivanyi. Copyright: Benzinga.
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