Longtime weedco True Leaf (MJ.C), which last year all but abandoned its application to become a Canadian licensed producer as it plowed headlong into the world of hemp-based dog treats, has lit up on the markets after news it has moved through security clearance on its application.

That’s good news for True Leaf, and has left them hurriedly unfurling dusty growhouse plans and making calls to consultants in an effort to get that application back on deck.

True Leaf Medicine Inc., a division of True Leaf Medicine International Ltd. (CSE:MJ), has engaged a number of cannabis experts to guide the company through the final stage in Health Canada’s review of its application for a license to produce marijuana in Canada.

Experts from industry-leading Pipe Dreemz Inc., Protect-IP Global Solutions Inc., Eurofins Scientific, and Ample Organics will be working with True Leaf over the next few weeks to prepare a review package for submission to Health Canada under the Access to Cannabis for Medical Purposes Regulations (ACMPR) application process.

True Leaf stock has jumped markedly since the news of their security clearance emerged, but it’s important to temper expectations, as this takes them

According to Health Canada, the process to get to full licensing is as follows:

  1. Applications received
  2. Preliminary screening
  3. Enhanced screening
  4. Initiation of security clearance process
  5. Review
  6. Pre-licence inspection
  7. Licensing

Stage 5 is where True Leaf is at now, and it’s perhaps the most arduous stage of the game.

Again, from Health Canada:

An application will be thoroughly reviewed to validate the information provided.

Given the extensive review process, applicants should anticipate communicating with the Office of Medical Cannabis multiple times to provide clarifications on the application. Health Canada may also request additional information from the applicant as required.

Physical security plans will be reviewed and assessed in detail at this stage. Please note that applicants must meet a minimum of a level 7 (as defined in the Directive on Physical Security Requirements for Controlled Substances (Licensed Dealers Security Requirements for the Storage Of Controlled Substances) to be considered for a licence. Physical security must comply with the Directive.

When Health Canada believes an application is ready for a pre-licence inspection, Health Canada will contact the applicant and identify the information that needs to be confirmed before a pre-licence inspection can be scheduled. This includes, but may not be limited to confirming how the applicant has indicated in their application that they would comply with Part 1, Division 1, Subdivision C (Security Measures) of the ACMPR.

Now, that’s no small thing – good for them, it means they’ve passed a few hundred others that have been stuck at security clearance for, in some cases, years. But the review process can also take a long time, and there are plenty of others who are at stage 6 now and in the queue proper.

Not only does True Leaf need to prep for the next exam, but it will also need to do some physical work, which will cost them some money.

Admittedly, that money may be easier to come into at the $0.45 stock price of this morning, rather than the $0.20-$0.25 it has been treading water at for the last year-plus, but turning on the jets for a full licensing push will mean doing a lot of things True Leaf hasn’t had to do in a long time.

The recent news makes True Leaf a $27 million market cap company, which is probably right on the money with today’s valuations of comparables. Just keep your heads up, investors, as there’s a considerable timeline between now and when this might be in the running for a licence, and many pieces will need to fall into place to warrant any upward stock volatility from here..

— Chris Parry

FULL DISCLOSURE: There is no commercial relationship between True Leaf and Equity.Guru, though the author has been a consultant for the company previously.

Written By:

Chris Parry

A multi-Webster Award winner for excellence in BC journalism, Parry is the founder and publisher of Equity.Guru, which he built with the specific plan to blend old school reporting with stock promotion, in a way that puts the emphasis on truth, high standards, and ethics. Parry is a veteran of TV, radio, and print, and consults with public companies to help them figure out their storylines, lay down achievable milestones, and improve their communication with shareholders, while also posting regular deep dive analysis of companies in the public spotlight.

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