CannTrust (CTST - Get Report) shares dropped Tuesday after the company said Health Canada partly suspended its license due to prior issues with unauthorized growing. 

Under the agency's order, CannTrust said, the Vaughan, Ontario, company cannot produce or sell new cannabis, but it is allowed to cultivate and harvest existing lots of cannabis and "[conduct] ancillary activities to those lots, including drying, trimming and milling."

Health Canada could reinstate CannTrust's licenses if the company comes back into compliance or can demonstrate that the suspension is unfounded, the company said.

In July, the company fired CEO Peter Aceto and let go President Eric Paul amid reports that the two executives knew of illegal pot-growing activities at one of the company's facilities.

In a statement CannTrust said management and the board "are reviewing the notice with the company's counsel and other advisers.

"Over the past two months, the company has moved swiftly to assess and address Health Canada's concerns, including areas of operational noncompliance. The company remains committed to being in full regulatory compliance."

The fallout from the production issue has weighed on the stock. The shares have fallen nearly 40% over the past four weeks. They dropped 15% on Tuesday, to $1.28.