FSD Pharma hires Korn Ferry healthcare recruiting leader Greg Button

12 February 2019 Consulting.ca

Greg Button, Korn Ferry's global head of healthcare recruiting, has been hired by Toronto-based cannabis manufacturing startup FSD Pharma to aid the company with executive recruitment during a transitional period.

FSD Pharma seeks to transform the former Cobourg, Ontario Kraft plant into the largest indoor hydroponic growth facility in the world. The company has 25,000 square feet available for production at the facility, with an additional 220,000 square feet currently in development. Through its subsidiary FV Pharma, the firm also intends to cover processing, R&D, and legal.

What a difference 14 years makes. Police in 2004 made one of the largest grow house busts in history at the former Molson brewery in Barrie, Ontario, where more than 30,000 marijuana plants were being grown. Property manager Roberto Derosa received a a seven-year prison sentence for his part in the scheme. He was one of a dozen people charged.

The former brewery had been outfitted with more than 1,000 hydroponic lights, and had dormitory-style housing, game rooms, and laundry facilities to limit suspicious movement.

Cobourg and Barrie are each an hour away from Toronto, but the circumstances of marijuana production between 2004 and today are light-years apart.

Using left-behind manufacturing plants to grow marijuana is now legitimate enterprise. Laws are drafted, battered by public opinion and policy research, and then redrafted. Still, it all feels so new - what so recently was the black market is now on the stock market.

Stormy weather

Earlier this month, FSD Pharma terminated an agreement with project partner Auxly Cannabis Group for falling behind on its contractual obligations. The firm had been tasked with developing the cannabis cultivation facility in staged phases.

“Auxly issued a press release on July 3, 2018 in which they anticipated that the first phase of construction would be completed and ready for Health Canada approval by the end of December 2018,” Raza Bokhari, FSD executive co-chairman, said. “We simply couldn’t wait any longer for our vendor to perform its obligations and therefore we terminated the agreement.”

Auxly identified the cause of the split as a number of contractual breaches from FSD’s side, alleging that FSD failed to acquire a sufficient head grower and staff, and highlighted “significant concerns” regarding current infrastructure at the Cobourg facility.

Righting the ship

On February 6, FSD announced Bokhari would be taking over as interim CEO, following the termination of Rupert Haynes. The leadership change, as well as the agreement termination with Auxly, were the results of a strategic assessment aimed at optimizing operations, according to the firm.

FSD also hired Button. The 20-year Korn Ferry veteran will be tasked with guiding the search for a pharmaceutical executive and other senior executives to lead the company’s pharmaceutical business practices. Button has more than two decades of executive search and healthcare experience, and has completed numerous senior management search assignments in the healthcare and life sciences sector.

"We are taking these momentous steps to unlock shareholder value and re-energize execution of our company's vision," Bokhari said. "The board believes the company has unique and invaluable assets and is taking appropriate actions that will support long-term positive cash flow and shareholder value."

Listed on the CSE as HUGE, FSD Pharma has a current market cap of $388.55 million.