TORONTO (Reuters) - Canadian marijuana producer Aurora Cannabis Inc on Wednesday dismissed claims from short-seller Citron Research that its stock was set to decline due to problems with its business model.

Citron earlier on Wednesday said Aurora shares are poised to shed half their value.

Aurora shares on Wednesday closed up 20 percent at C$14.18. They hit a 52-week low of C$1.90 in June.

Citron said in a report posted on Twitter that Aurora lacks a path to profitability, is spending too heavily on acquisitions and that stock sales by company insiders show a lack of confidence in the company’s future.

Aurora executive vice president Cam Battley dismissed the allegations, saying by telephone that the company had made “a conscious choice” to operate at a loss so it could invest in future growth.

“We see a significant window of opportunity to establish a global presence,” he said. “We’re investing now to establish our presence in Canada and significantly around the world as well.”

Aurora has invested in expanding annual marijuana production capacity to 113,300 kilograms (249,784 pounds) per year through existing and new facilities, which will all be operating by the middle of this year, Battley said.

He said Aurora’s purchase of Pedanios GmbH, Germany’s largest distributor of medical cannabis to pharmacies, for C$23 million ($18 million) was an example of investments that will boost future revenue.

“It’s one of our crown jewels. And it opens up the entire European Union market,” Battley said.

Citron also criticized Aurora’s C$600 million offer to buy smaller rival CanniMed Therapeutics.

CanniMed on Wednesday in a statement criticized Aurora’s hostile takeover bid, which offers a capped price of C$24 per CanniMed share payable in Aurora shares, as too low. CanniMed shares closed up 8.2 percent at C$26.12.

On insider sales, Battley dismissed them as nothing out of the ordinary. Company insiders sold C$20.5 million over the past two months, according to Thomson Reuters data, as Aurora’s shares have more than quadrupled.

“It’s normal, if you have an appreciating stock as part of management’s compensation, people are going to take a little off the table every now and then,” Battley said.

“He doesn’t have a clue what he’s talking about,” Battley added of the Citron report.