HEXO stock is recovering this morning after HEXO Corp (TSX:HEXO) (NYSE:HEXO) announced that it has received licenses from Health Canada.
New HEXO Licenses
It goes without saying that much of 2019 has proven to be a tough period for most cannabis companies in North America, and like most other companies, HEXO Corp has suffered as well. That being said, the company has continued to try and expand its business.
In a new development, the company announced that it has been granted permission by Health Canada to launch research activities at the Centre of Excellence in Belleville, Ontario. In addition to that, the company has also been granted permission for selling cannabis-infused beverages, extracts, topicals, and edibles. It goes without saying that today’s developments will come as a massive boost for HEXO stock investors.
The Chief Executive Officer and co-founder of the company Sebastien St-Louis spoke about the effect the license will have on the company: “The research license will allow us to take our innovation work to the next level, with testing on derivative products, including taste testing. Consumers have high expectations for their packaged goods experiences, and cannabis will be no different.”
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At the time of writing, HEXO stock is up 3% at $2.45 on the NYSE.
The Centre of Excellence has only been given permission for the first phase at this point. It is a facility that could be used to produce a wide range of products by HEXO Corp.
While these are promising developments, it has also emerged today that the company is going to close a number of facilities located in Niagara Falls, Ontario. Sources that are close to the developments stated that the move is linked with the announcement that was made by HEXO last week about 200 layoffs.
However, it is important to note that the company has not made any official announcements in this regard and has refused to comment on the matter as well. The facilities in question actually belonged to Newstrike Brands, which was acquired by HEXO earlier this year. As of April, HEXO Corp had 822 employees.
HEXO stock has tumbled about 40% so far this month.
Featured image: Canva
