N.B. Creates Crown Corporation for Cannabis Sales, Signs MOUs with Producers
MONCTON – The provincial government has created a Crown corporation for cannabis sales and signed memorandums of understanding (MOU) with two licensed producers, the finance minister announced at a press conference this afternoon at the at the Delta Beausejour Hotel.
These are the first two major steps towards establishing a legal recreational marijuana market in New Brunswick, which must be in place by next July.
The two companies are longtime producers for the country’s medical marijuana program – Moncton-based Organigram and Ontario-based Canopy Growth. These partnerships between the companies and the government are the first of their kind in Canada.
Beginning next July, their cannabis products will be sold in retail stores operated by a Crown corporation newly formed by the New Brunswick government, said Finance Minister Cathy Rogers.
We have created a Crown corporation to truly put the province in the driver’s seat of the sale of cannabis in the province,’’ the finance minister stated. “It will be sold in a safe, secure and socially responsible manner.’’
The government said the agreement was the result of positive, productive and ongoing consultations between the companies and the province. It also said the agreement reinforces the progressive leadership of New Brunswick on this issue, and shows the province’s commitment to New Brunswick-based business.
“We are pleased to partner with [a] local company [in Organigram] to secure a supply for our New Brunswick market in time for the July 2018 launch,’’ said Rogers. “In addition, the creation of this new provincial Crown corporation provides for flexibility and lays the groundwork for the eventual retail model once the final decisions around that have been made.’’
By creating a crown corporation that overseas retail outlets, much like NB Liquor, the government ensures that it maintains full control of the sale of recreational cannabis. This approach has been criticized by the opposition Progressive Conservative. They say the private sector should be allowed to operate retail cannabis businesses.
Rogers said the creation of the Crown corporation was an important first step for the province in order to prepare for the retail sales of cannabis in the province.
The provincial government is working very hard to prepare for July while making health and safety a priority,’’ she said. “The Crown corporation will help ensure that we oversee the business on behalf of the government and provide some flexibility as the groundwork is laid for the final model.’’
Rogers said discussions are ongoing with other licensed producers, so she’s not ruling out involvement with other companies moving forward.
She said the “door is open” to other forms of private sector involvement, but she said starting small with the Crown corporation has allowed them to move forward with the memorandums of understanding with Organigram and Canopy Growth.
“The retail model details will be worked out over the next few months,” she said. “We needed to start and get in right from the outset. We’re going to start with the Crown corporation, but it’s uncharted territory so who knows where it will go. Time will tell.’’
RELATED: Organigram signs MOU to distribute Marijuana for the Recreational Market
Organigram has agreed to supply a minimum of five million grams per year at an estimated retail value of between $40-$60 million annually. Organigram’s Chief Executive Officer Greg Engel praised the province’s national leadership role in putting the pieces in place for a recreational market.
“The Government of New Brunswick has established itself as a leader in the developing marijuana industry, working to ensure that the industry develops in a responsible and effective manner,” said Engel, who employs more than 100 people at Organigram.
“New Brunswick’s stewardship on this file has been recognized throughout Canada and we are proud to work closely and support them as a strategic partner.”
RELATED: Ontario’s Canopy Growth Signs MOU with N.B. for Recreational Marijuana Distribution
Mark Zekulin, president of Canopy Growth, also praised the province’s leadership role.
“Today is a historic day for cannabis in New Brunswick and the country,’’ Zekulin went on to say. “I commend the Premier for his leadership on the cannabis file.’’