Ohio medical cannabis sector expands as adult-use…


Ohio has issued a batch of provisional marijuana retail licenses that will allow the cannabis industry to further lay the groundwork for the launch of recreational sales, which has been put off until at least next year.

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The Memorial Day weekend arrived with backers of recreational cannabis back on the streets collecting signatures to launch sales to the general public, and with marijuana operators ready to open a new roster of retail outlets using 70 provisional licenses issued earlier this month by the Ohio Board of Pharmacy. The new licenses will more than double the number of medical dispensaries in the state, which currently numbers a paltry 58 to serve more than 271,000 legally registered patients.

The developments have set the stage for a summer that will, assuming everything goes smoothly, firm up the foundation of the industry to ensure it will be able to effectively meet the needs of medical marijuana users and the anticipated boom that will occur once adult-use sales are approved by the so-far reluctant state legislature.

“This expansion is long overdue,” said Paul Armentano, deputy director of the National Organization for the Reform of Marijuana Laws (NORML). “High prices and the lack of convenient access are significant barriers to Ohio’s patient community and the addition of these licensed operators will better address patients’ growing demands.”

The Republican-led legislature in Ohio has shown a level of indifference to expanding legalized marijuana in the state, leaving the question largely to industry advocates who have been seeking both approvals through the legislature and through a public petition drive that would place the question of legalized adult-use pot on the November 2022 ballot.

Currently, legislation to open the adult market is creeping through the approval process in the General Assembly, but the petition route hit a significant detour earlier this year when the organizers, the Coalition to Regulate Marijuana Like Alcohol, failed to submit enough valid signatures to get the measure before the voters this fall. Faced with the prospect of a tight deadline to collect the remaining signatures, the coalition struck a deal that would aim for the 2023 ballot rather than risk a far narrower window to put the measure on this fall’s ballot.

The petition deal presumably will reduce the risk of failure to win public approval of adult sales, but time is not necessarily an ally of the existing cannabis industry, which is seen as too small to adequately serve its existing customer base. The result has been criticism that 58 dispensaries are scattered unevenly around the state with limited menus and stiff prices, which has prompted patients and caregivers to turn back to black-market dealers offering tax-free prices or cross state lines to patronize recreational dispensaries in Michigan.

Patient advocates say the most productive step would be for the General Assembly to move ahead with legalization legislation, which is currently stuck in committee. State Rep. Casey Weinstein (D-Hudson), a cosponsor of the bill, said Ohio was “ready for legalization” and marijuana has already been decriminalized in many communities. “The hundreds of thousands of Ohio voters who signed this petition—and millions more who support legalization statewide—asked for action from our legislature. Instead, GOP leaders have ignored them.”

In the meantime, the 70 new dispensaries could relieve some of the pressure by giving patients additional outlets, particularly in underserved communities. It will also allow new cannabis entrepreneurs to enter the arena and also give existing vertical operators the chance to expand their customer base in the face of stiff competition from underground dealers.

“As an Ohio-owned and operated cannabis company, we see these retail licenses as a critical component of our business model,” said Adam Thomarios, founder and CEO of Klutch Cannabis, a growing operation that received provisional licenses for two new dispensaries in Lorain and Canton. “The addition of retail will finally give us the opportunity to speak directly with patients and to have control over how our products are marketed and sold.”

The conditions of the provisional licenses give recipients 270 days to prove to the state that their dispensaries are up and running and providing medical marijuana to legal patients and caregivers. But the industry has been chomping at the bit and most will likely be up and running by the time Ohio finally opens its doors to recreational business.

“We love our new dispensaries site,” said Rebecca Myers, founder and CEO of FARMACEUTICALRX, which received a license for a retail location in Cuyahoga Falls and already runs a dispensary and Level 1 cultivation and processing facility in East Liverpool.

Myers said the company was set to release its own branded products in Ohio, including edibles and vape products as well as similar products from an out-of-state partner. “We anticipate that our first harvest in Ohio in Q2 2022 and this newly awarded retail license will combine with our existing assets to strengthen our position in the fast-growing Ohio market.”

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