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Cannabis Companies Brace for Coronavirus Impact

Amid the COVID-19 pandemic, a dilemma has hit the nascent industry: to close or not to close? We’re keeping track of how companies, and regulators, are reacting.

The cannabis industry, like other industries, has been upended as the coronavirus (COVID-19) pandemic worsens. Events have been cancelled. Consumers are stocking up on flower and products. And on Tuesday, one of the largest cannabis companies in the world, Canopy Growth, announced that it would temporarily close nearly two dozen corporate-owned retail shops in Canada.

“We have a responsibility to our employees, their families, and our communities to do our part to ‘flatten the curve’ by limiting social interactions. For us, that means shifting our focus from retail to e-commerce,” Canopy Growth CEO David Klein said in a statement.

This move puts a spotlight on an early question that cannabis business owners are wrestling with: to close or not to close?

Considering that Canada allows for e-commerce, the impact of this “shift in focus” on companies like Canopy is smaller than it would be for a U.S. company. In the U.S., a company would need to hire or expand delivery staff because, unlike in Canada, the postal system in the US is off-limits due to federal prohibition. Also, not all states allow for cannabis delivery to begin with.

There’s also the potential for forced closure. In the U.S., rules related to containment of coronavirus are rapidly evolving, as are restrictions. More than a dozen governors have ordered hospitality establishments closed outside of take away orders. And in the San Francisco Bay Area in California, where medical and adult use cannabis is legal, a shelter-in-place policy means that residents are barred from leaving their homes unless it’s for an “essential” reason, like going to the doctor or grocery store.

Some cannabis businesses are likely to be considered less “essential” than others. So far, there are only a few legal cannabis consumption spaces in the U.S., but one of the first, called The Coffee Joint, went the way of bars and restaurants: closed.

“The only change in Denver so far is that the one licensed cannabis consumption facility has been ordered to temporarily close under the public health order,” Eric Escudero, the director of communications for Denver’s department of excise and licenses, told Cannabis Wire.

When it comes to medical cannabis, while businesses serving patients face a unique challenge because some of those people visiting storefronts could be immunocompromised and at a heightened risk of illness, as of Tuesday evening state regulators contacted by Cannabis Wire appear to be taking the position that medical cannabis shops are “essential.”

As Nate Wardle, the press secretary for the Pennsylvania Department of Health, put it to Cannabis Wire, “In Pennsylvania, medical marijuana dispensaries are considered the same as pharmacies, and so they are considered essential during this time of non-essential retail being shut down to mitigate and increase social distancing.” (Delivery is not allowed in Pennsylvania.)

To Read The Rest Of This Article By Alyson Martin on Cannabis Wire

Published: March 17, 2020

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