Despite the initial success of marijuana sales throughout Canada, our neighbor to the north has continued to experience a rash of problems, all stemming from the sale and distribution of the little green plant. In the past week, an unidentified hacker breached an Ontario-based online retailer and accessed thousands of consumer profiles. Meanwhile, one man has taken an issue concerning medical marijuana to Alberta officials. What else could possibly go wrong? Well, how about international trouble as a starting course? Recently, Germany’s top marijuana distributor filed claims against two Canadian producers for a failure to deliver a surplus of products. Needless to say, the situation only gets stickier from here. Let’s take a closer look at how Canadians LPs could lose €14.7 million due to failed product deliveries.
Pot Problems
Recently, Canadian LPs faced tremendous backlash from Cannamedical Pharma (Germany’s most prominent marijuana distributor), which filed a claim in Ontario courts for the Canadians’ failure to deliver a significant lineup of binding purchase orders. As a whole, the German company is tremendously upset that Aurora Cannabis Corp. and MedReleaf Corp. failed to deliver an estimated 100 kilograms of cannabis products each month. So where did the problem start?
Back in May 2018, MedReleaf announced its partnership with Cannamedical as an opportunity to secure a strong relationship and security of drug distribution in the German market. Later, in July, Aurora Cannabis purchased MedReleaf for a staggering $3.2 billion CAD, and the MedReleaf strain Stellio debuted in Germany. While the initial order of 33 kilograms was successfully delivered, the next order (23 kilograms) was sent to another buyer, with no available replacement being offered.
While both Canadian companies reassured improvements in the system, both Aurora and MedReleaf failed to deliver two more orders.
Massive Loss
Needless to say, the officials for the German company were far from pleased. Now, both Canadian LPs are facing a €14.7 million suit aiming at damages, on the grounds that Cannamedical cannot obtain these products anywhere else. As of Spring 2017, German doctors can only obtain marijuana through specially-designated pharmacies. Overall, Cannamedical had assisted MedReleaf through the process of achieving approvals and had provided excellent resources for locating doctors who could prescribe the drug.
Right before the lawsuit was issued, MedReleaf terminated its agreement with Cannamedical. You do the math on that one.
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