In these days of factories shutting down, it’s hard to know if something is temporary or permanent – and it doesn’t help if contact people are unreachable or don’t have answers. But we have two facts: 1) The operators of the Cannabis operation at 520 William street announced on March 23 that they are stopping production at their plant because of Covid-19 restrictions. Less noticed but more importantly, around the same time (the broker didn’t remember exactly when), 2) the entire plant was put up for sale for $19.9M. If their plant is up for sale, then the idea that all their staff is “furloughed” is questionable. How can they return to work if their building has been sold? So let’s look at exactly what has been published.
See the links below for the complete source information but here are the key parts:
1. Plant Shutdown – 23 March 2020
Effective immediately, FSD Pharma management has implemented a systematic and orderly scale back of FV Pharma’s cultivation operations and a furlough policy for its workforce, except for certain personnel working staggered shifts to ensure continuity of operations and licensure. The Company has also closed its facility to collaboration partners and ceased their operations.
2. Real Estate Listing – highlights
Address: 520 William St., Cobourg, Ontario K9A 3A5
Size: 581,538 sq. ft.
Pharmaceutical-Grade Manufacturing Facility located In the heart of Cobourg. Close proximity to Highway 401. Access to plenty of surrounding amenities. Approximately 18.96 acres of additional “Developable” land included.
Leaseback on 40,000 square feet of office space required.
The leaseback requirement implies that they want to shut the factory but keep the offices for their company. If true, that would mean the company no longer plans to grow weed but instead simply operate a medical cannabis business. However, I note that previous announcements talked about a “25,000 square foot licensed cultivation area” so maybe “Office” includes some cultivation space. What happened to the grandiose HUGE growing area?
Sorry to be extrapolating and asking questions instead of providing answers – feel free to draw your own conclusions from the two announced facts.
Update – 5 June 2020
FSD Pharma announced that they have received “U.S. FDA Approval to design a Phase 2a Clinical Trial to Treat Patients with Suspected or Confirmed COVID-19 Diagnosis” The stock jumped on this news. Details here.
- FSD Pharma Press Release – 23 March 2020
- Real Estate Listing – Listing date – a few weeks ago.
- FSD Pharma Web site
- Cannabis Facility Update (Cobourg News Blog article)- 7 Feb 2019