In November 2023, the Buckeye State became the 24th state to legalize the use of cannabis for adults twenty-one (21) years and older. Since then, the state of Ohio has been diligently working towards implementing its program to ensure access to cannabis is available to its residents as soon as practicable. As such, the Ohio Division of Cannabis Control (“Division”) has been accepting applications from current medical cannabis operators since June 7th to allow them to convert to dual licenses, so they can serve both the medical and adult-use programs in the state. One month after the application window opened, one hundred and ten (110) medical dispensaries out of the one hundred and twenty-four (124) applied for dual licensure. So, when will the first adult-use dispensary be open in Ohio?
Last in the Supply Chain
Since Ohio’s voters approved of Issue 2, many have been anxiously awaiting the first opening of an adult-use dispensary in their city, yet hopefuls are wondering why other license types such as cultivator, processor, or even testing laboratories are receiving not only provisional license approval, but also certificates of operation first. This step in the Division’s program is essential to the program’s success as understandably, applications from cultivators, processors, and testing laboratories will receive priority to ensure a supply chain is implemented since the first adult-use products on market must come from and be tested by a dual-licensee. Moreover, operators applying for dual-licensure as a dispensary are faced with more “conversion-like” requirements compared to cultivators and processors. For example, dual license dispensaries must demonstrate to the Division that they can effectively process both medical and recreational orders, including having an adequate supply of product to sell to both clienteles. On top of that, dually licensed dispensaries must ensure that their staff are thoroughly trained on how to approach each consumer prior to their doors opening to the public. Although many were hopeful to see dispensaries open their doors by mid-June, the state likely won’t see a dispensary be issued a certificate of operation until August.
Anticipating a Boom: Ohio’s Projected Market Growth
In 2023, Ohio’s medical cannabis dispensary operators reported selling $484 million according to the Ohio Department of Commerce. With the state’s population nearing twelve (12) million, experts project that the state will exceed the $1 billion mark by the end of 2027 once its program is fully operational. As the seventh largest state in the country, not only will Ohio’s population attribute to the program’s expected success, but also its ideal geographical location which borders five (5) states—only one of which has legalized the adult-use of cannabis. With the consumer population expected to nearly triple the current number of registered patients in the state, operators are expecting demand to double on day one and bring continued success to a state whose medical market has been largely underwhelming.
Ohio’s Emerging Dispensary Opportunities
Pursuant to Ohio law, the state can potentially see up to nearly three hundred and fifty (350) dispensaries. The state currently has one hundred and twenty-four (124) medical cannabis dispensaries, which all are eligible to apply for dual licensure. Further, there are one hundred and sixty-eight (168) 10(b) dispensary licenses that current medical cannabis cultivators or dispensaries can enter into a lottery for. After the Division awards such licenses, they will open an application window for an additional fifty (50) dispensary licenses that will give preference to applicants who participate in Ohio’s cannabis social equity and jobs program.
As the Division continues to issue certificates of operation and conduct inspections for future adult-use cannabis operators, residents of Ohio should be gearing up to see a massive expansion in the state’s current operations. With all dual license applications set to be approved or denied by September 7th, residents and visitors of Ohio will likely be able to purchase cannabis in the coming weeks. If you are interested in entering Ohio’s soon-to-be-booming market, contact us today to discuss your options!