Canopy Growth (NASDAQ:CGC) announced on Friday that it was revising its schedule for launching cannabis-infused beverages in Canada's new "Cannabis 2.0" cannabis derivative products market. The company didn't give a new date for rolling out its new beverage products but stated in a press release that it "does not believe this delay will have a material impact on its FY20 revenue."
Canada's new regulations for cannabis derivative products went into effect on Oct. 17, 2019. However, a 60-day notification period is required before companies can launch new cannabis products. In addition, facilities involved in producing the products must receive appropriate licensing.
Canopy Growth received a license for its beverage facility in late November 2019. The company's original plans were to launch its first cannabis chocolates and ready-to-mix cannabis beverages in early January. Canopy expected to roll out additional cannabis beverage brands later in January followed by cannabis-infused spirits in February.
Reason for delay
There's a lot of work required to move from making cannabis beverages in a lab to producing these beverages on a commercial scale. Canopy stated that "the scaling process is not complete" and that its teams are working on the final steps.
New Canopy Growth CEO David Klein said, "Canopy has had seven weeks to work with THC in the brand new beverage facility to scale processes and IP [intellectual property] it has developed in the R&D environment." He added, "In order to deliver products that meet our customer's high standards we are electing to revise the launch date while we work through the final details."
Canopy expects to provide another update when it announces its third-quarter results in mid-February.