Photo: The Canadian Press

Hexo Corp.'s chief executive says he's seen a "price war" take shape over the last five months that could cause "significant" damage to Canada's cannabis industry.

Charlie Bowman says there are many smaller and independent pot retailers that are "bleeding" because of the higher number of rivals and their tendency to undercut one another.

He says the industry's pricing troubles have been compounded by the illicit market, which Bowman noticed had "fantastic" growth this year, challenging licensed cannabis producers.

Bowman is hopeful the Ontario Cannabis Store's plan to reduce its margin and markups later this year will help licensed producers chisel away at the illicit market.

The provincial pot distributor's move is expected to put $35 million back in the hands of licensed pot companies this fiscal year and $60-million in the 2024 fiscal year. 

By the OCS's count, the illicit market made up 43 per cent of Ontario's cannabis market last March.