Ohio cannabis recap

Ohio voters passed Issue 2 in 2023, effectively legalizing the recreational use and commercial sale of cannabis in the state. A lot has happened since our last Ohio cannabis update. Here’s what you should know.

Back in June, regulators notified 60 medical cannabis license holders that they can transition to adult-use cannabis sales once the state allows. Since that announcement, the state received hundreds of applications to transition medical dispensaries to include adult-use sales.

Those who qualified needed to submit a “certificate of operation” before transitioning to the adult-use market. The certificate includes proof that the point of sales systems can keep medical and recreational data separate, proof of up-to-date security, and more.

After much anticipation, adult-use cannabis sales in Ohio began on August 6th, 2024. With that, the state became the 21st in the nation to launch adult-use cannabis sales. At the time of launch, the state had approved 98 dispensaries to begin adult-use sales.

Ohio will be giving out 40 Level III Cultivation and 50 Retail Dispensary licenses to new applicants, with a preference to certified participants in the Cannabis Social Equity and Jobs Program. The state has yet to announce when the application process will happen, and is still establishing the Cannabis Social Equity and Jobs Program. Once the program is established and applicants are certified, the DCC has the authority to request applications for these licenses.

Ohio recreational cannabis market by the numbers

While Ohio has seen a surge in cannabis sales, reports indicate that the neighboring state of Michigan has simultaneously experienced an increase in sales. This comes as a surprise to some who expected to see a decrease in Michigan sales due to Ohio consumers no longer needing to cross state lines to access recreational cannabis.

Still, Ohio has seen impressive growth. In August–the first month of sales–Ohio saw more than $44 million in cannabis sales. In just the first two weeks of September, the state brought in more than $65 million.

In its first month of sales, dispensaries reported selling 6,179 pounds of plant material and over 840,000 units of manufactured goods including edibles, vapes, beverages, and topicals. While the state doesn’t track how many purchases stem from out-of-state visitors, reports indicate that Cincinnati has become a hub for out-of-state shoppers from Kentucky and Indiana.

Marketing mishaps

Ohio cannabis regulators are strict about their marketing rules. Over the summer and leading up to the launch of adult-use sales, the state issued more than $212,000 in fines to companies improperly marketing their cannabis sales.

The Botanist, owned by New York-based Acreage Holdings, received a $12,500 fine over the summer for their websites header reading: “Can you take me higher?” According to state regulations, dispensaries cannot use an ame, logo, sign, or advertisement until they’ve paid an advertising fee and been approved by the state. At the time, the Botanist had not completed the required steps.

The same company later faced a fine for allowing an ice cream truck vendor on their dispensary premises. With an accompanying social media post advertising free ice cream and other violations, the company faced another $150,000 in fines.

Several other medical dispensaries received fines for advertising themselves as medical and adult-use dispensaries despite not having received approval from the state for adult-use sales.

These recent violations are a stark reminder for companies to stay up-to-date with regulations of each state they operate in.

Are you interested in obtaining a cannabis business license in Ohio? Call us to speak with an industry expert at 602-290-9424.

Need help developing an effective business plan? Shop our templates today!