Big cannabis companies scale back amid coronavirus

  • Harvest Health & Recreation, a multistate cannabis company based in Arizona, called off its planned acquisition of privately held Chicago-based Verano Holdings, with the companies citing prolonged obstacles that include the coronavirus crisis.
  • The company also delayed the launch of a marijuana manufacturing facility, saying that California’s adult-use marijuana market faces challenging conditions and had been even before the COVID-19 pandemic.
  • Cannabis businesses have been running pretty inefficiently for a while, said Nic Easley, CEO of Denver-based 3C Consulting, and tended to throw money at problems when the prices for wholesale cannabis were high.
  • St. Louis-based investment bank Stifel recently released a report saying it believes COVID-19 will negatively impact the legal marijuana industry’s development and ability to profitably fulfill demand.

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