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Craig Wiggins, an independent industry analyst and founder of The Cannalysts, a popular blog and Reddit channel, agreed with the notion that Bay Street was put ahead of the consumer in the first year.

“The industry relied on hype so much to get its stock price up so it could raise capital at an efficient level, that it thumped its chest on metrics like ‘funded capacity,’” he said.

But turning capacity into profitable production was a different story. Problems associated with scaling up led to write-downs, and mediocre sales growth was not enough to offset rising costs.

To date, most major cannabis companies are still unprofitable. In some cases, profitability was promised within a year of legalization, but those goalposts were perpetually pushed back in favour of international expansion, major acquisitions in the name of securing intellectual property and partnerships with larger companies outside the cannabis space.

To appease the market, changes were made. Canopy founder and co-CEO Bruce Linton, the industry’s most prominent leader, was terminated just weeks after the chief executive of alcohol giant Constellation Brands — which had bet billions on the company’s future — expressed disappointment with Canopy’s continued losses.

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The industry’s many scandals didn’t help either. Within two months of legalization, a short seller alleged Aphria Inc., one of the largest licensed producers, was engaging in self-dealing, and inflating the value of its international assets. The company’s stock plunged in the weeks following the report, and several key members of the executive team, including CEO Vic Neufeld departed the company.

Shortly after, Manitoba-based licensed producer Bonify Medical Cannabis Ltd. had its licence suspended by Health Canada, after 200 kilograms of illegal cannabis were found in the company’s vaults.

But it was the CannTrust Holdings Inc. scandal that thrust the industry’s lacklustre corporate governance practices into the spotlight. In an apparent rush to boost output, the licensed producer was caught growing in spaces not yet licensed by Health Canada, apparently with the knowledge of senior management. That led to an Ontario Securities Commission investigation, a licence suspension and an almost complete decimation of the company’s stock.