Federal Illegality Risk: Terrascend operates in the cannabis industry, which remains federally illegal in the United States. This exposes the company to significant risks including limited access to traditional banking services, difficulty raising capital, potential federal enforcement actions, and the inability to transport cannabis products across state lines, hindering interstate commerce and efficiency.

Intense Competition Risk: The cannabis market is highly competitive and rapidly evolving, with numerous licensed operators and a persistent illicit market. Terrascend faces competition from established multi-state operators, smaller craft growers, and new entrants, which can lead to price compression, reduced market share, and increased marketing expenditures, impacting profitability.

Regulatory Landscape Volatility Risk: Terrascend's operations are subject to complex and frequently changing state-level cannabis regulations, including licensing requirements, cultivation limits, product testing standards, marketing restrictions, and taxation. Any adverse changes or new restrictive regulations could significantly impact its operational costs, market access, and overall business viability.