The move comes less than a month after its largest lender, Pelorus Fund REIT, initiated receivership proceedings in the U.S., seeking court-appointed management of StateHouse’s assets after the company defaulted on four loans. Pelorus filed the receivership complaint in September, citing StateHouse’s inability to meet its financial obligations.
StateHouse, previously known as Harborside, was a pioneering name in the cannabis industry, dating back to 2006 when it was among the first to receive a medical marijuana license in the U.S. However, a series of acquisitions and management changes in late 2020 contributed to its financial downfall, as noted by the company’s founders, Steve and Andrew DeAngelo. The DeAngelo brothers, who were forced out in what they describe as “a hostile takeover”, have expressed interest in potentially repurchasing the company.
As part of the bankruptcy process, StateHouse’s shares were halted on the Canadian Securities Exchange, and the company anticipates being delisted soon.
StateHouse now joins a growing list of other prominent cannabis companies that have sought similar legal protection, including Herbl, Skymint, and MedMen Enterprises Inc. (OTC: MMNFQ), which declared bankruptcy in Canada and entered receivership in US earlier this year.
#3: Tilray Brands
Tilray Brands, Inc. (NASDAQ: TLRY) (TSX: TLRY) reported its financial results for the first quarter ending August 31, 2024, highlighting mixed performance. The company’s revenue increased by 13% year-over-year to $200 million, up from $177 million in the same period last year. However, this marked a sharp decline from the previous quarter’s revenue of $229.9 million, and it missed the Yahoo Finance average analyst estimates of $219 million.
On a brighter note, Tilray’s net loss improved significantly, shrinking by 38% to $(34.7) million, compared to $(55.9) million in the prior year. The net loss per share also improved to $(0.04) from last year’s $(0.10), matching Yahoo Finance analyst estimates.
Breaking down the revenue by sector, cannabis sales dropped to $61.2 million from $71.9 million in Q4, while beverage sales fell to $55.9 million from $76.7 million. Distribution sales grew slightly to $68 million from $65.6 million, and wellness sales fell to $14.7 million from $15.7 million.
Despite reporting a gross profit of $59.7 million (a 35% increase year over year), Tilray missed analysts’ gross profit expectations of $64 million. EBITDA also fell short at $9.3 million, below the $11.9 million estimate.
Speaking about Tilray’s financial results, Chairman and CEO, Irwin D. Simon, emphasized the company’s commitment to future growth, saying, “Our investments in the cannabis, wellness, beverage, and distribution industries are focused on shaping the future and staying ahead of the curve.” He also expressed optimism about upcoming regulatory changes, stating, “We believe that there is a greater likelihood that the upcoming U.S. Presidential elections will result in improved regulatory changes in the cannabis industry.” Simon added that both presidential candidates support further cannabis legalization, which could open new opportunities for the industry
#4: Canopy Growth
Ontario-based Canopy Growth Corporation (TSX: WEED) (NASDAQ: CGC) announced that it had finalized its $279 million acquisition of U.S. cannabis edibles company Wana Brands, nearly three years after the deal was first announced. The acquisition, which was made through Canopy USA, a subsidiary that was specifically designed to help the company enter the U.S. market, gives Canopy full ownership of Wana Wellness LLC, The CIMA Group LLC, and Mountain High Products LLC, which are all under the Wana Brands umbrella.
Wana Brands, which is known for its cannabis edibles, recently ventured into the hemp-based edibles market through its new line, Wanderous, adding further flexibility to Canopy USA’s product offerings.
The completion of this strategic acquisition marked a significant step in Canopy’s expansion into the U.S. cannabis market, as the company aims to solidify its position with a diverse portfolio of top-tier brands. Canopy USA has been actively acquiring other key players in the industry, including a 75% stake in California-based Jetty. The company is also pursuing the acquisition of Acreage Holdings, Inc. (OTC:ACRHF) (OTC:ACRDF), a multistate operator in New York, with the deal expected to close in 2025.
Despite these acquisitions, Canopy continues to face financial challenges, reporting a net loss of C$127 million in Q2 2024, following a C$129 million loss in first quarter.
Top Psychedelic Company for Week
#1: Awakn
Awakn Life Sciences Corp. (CSE: AWKN) (OTC: AWKNF), a biotechnology company focused on therapeutics for substance use and mental health disorders, announced that it had selected Eurofins Discovery to conduct pharmacology testing for its co-lead aminoindane series. This is part of Awakn’s New Chemical Entity (NCE) pre-clinical program aimed at developing advanced treatments for addiction, particularly Alcohol Use Disorder (AUD), as well as mental health conditions like PTSD.
Eurofins Discovery, which is a leader in drug discovery research, will play a key role in advancing the pre-clinical phase of Awakn’s research. The NCE program is being co-developed with Graft Polymer (UK) Plc and focuses on creating therapeutics for trauma-related disorders, including PTSD, which affects millions in the US, UK, and Europe.
The collaboration marked a significant milestone in Awakn’s mission to provide innovative solutions for addiction and mental health. The company’s management team emphasized that this partnership would help accelerate the development of groundbreaking treatments.
Commenting on this deal, Prof. David Nutt, Awakn’s Chief Research Officer, stated, “The selection of Eurofins Discovery for this crucial stage of pharmacology testing is a significant step forward in our pre-clinical program. We are confident that this collaboration will accelerate our path to delivering groundbreaking treatments for mental health and addiction disorders.”
Additionally, the company’s CEO Anthony Tennyson also commented, saying, “Our partnership with Eurofins Discovery is a testament to the progress we’re making in developing innovative solutions for AUD and other mental health challenges. We are excited about the potential impact our NCE program could have for patients in need across North America and beyond.”
