On Feb. 7, Ascent Industries, the parent company of licensed producer Agrima Botanicals, issued an update on its subsidiary’s ongoing licensing saga, and it’s not looking good for Agrima or Ascent Industries.
According to a statement from Ascent:
“Health Canada has repeated its previous position that the Company [Ascent Industries] has failed to demonstrate that the suspension, and proposed revocation, of Agrima’s Licenses is unfounded, or that the failures that gave rise to the suspension were rectified.”
It went on:
“Health Canada has therefore advised that it still intends to revoke the Licenses, and has given Ascent until February 20, 2019 to make any additional submissions.”
This is over what Health Canada called “unauthorized activities with cannabis” that occurred after Agrima was issued licenses to produce and distribute cannabis.
In response, Ascent launched an ongoing investigation into the unauthorized activities that included a thorough analysis of its books and records.
Ascent is also busy working on how to move forward as it said:
“As previously disclosed by the Company, a strategic review process is continuing, with a view to stabilizing the Company’s financial position and maximizing the value of the Company.”
Ascent also acknowledged in its statement that if Agrima’s licenses are not reinstated by Health Canada, its ability to keep operating will be put in jeopardy. Losing its licenses will severely impact Ascent’s and Agrima’s ability to participate in the Canadian cannabis market, and would affect the 3 Agrima locations that make up 31 hectares in total, as seen in the graph below.
All of this uncertainty is affecting Ascent stock price, and you can bet its shareholders aren’t happy as shares of Ascent (CNSX: ASNT) dropped to their lowest point since Dec. 5.
For more information on Ascent and Agrima, check out the CLN story from the other day that also covers the situation unfolding around Bonify Medical Cannabis, another licensed producer that recently had its licenses suspended by Health Canada over allegations that it sold unauthorized cannabis.
Featured image courtesy of Dankr.
Proactive Investors: Ascent Industries has until February 20 to make additional submissions to Health Canada.