Marijuana Business Magazine October 2019

Marijuana Business Magazine | October 2019 124 For information about cannabis regulations in other markets, order the Marijuana Business Factbook at Main measures MMJ business regulations State tax requirements Sampling of state licensing & application fees House Bill 523 (passed in 2016) Regulations require businesses to meet certain financial criteria, adhere to local zoning laws, utilize the state inventory tracking system and meet multiple security, storage, sanitation and quality standards (including specific labeling requirements). MMJ is subject to state and local taxes. APPLICATION Cultivators: Level I: $20,000 (up to 25,000 square feet) Level II: $2,000 (up to 3,000 square feet) Dispensaries: $5,000 Processors: $10,000 Testing labs: $2,000 LICENSE Cultivators: Level I: $180,000 (initial); $200,000 (annual renewal) Level II: $18,000 (initial); $20,000 (annual renewal) Dispensaries: $70,000 (biennial) Processors: $90,000 (initial); $100,000 (annual renewal) Testing labs: $18,000 (initial); $20,000 (annual renewal)   What to watch Expect statewide access to dispensaries and infused products to increase as businesses with provisional licenses are granted certificates of operation from the state. When sales began in Ohio, only four dispensaries were in operation. As of late August, 26 dispensaries had been granted certificates of operation, with another 30 provisional licensees awaiting final approval. Additionally, only 18 of 30 cultivators had been given the green light to begin operations, and only eight of 40 processors. As growers and processors have come online, product access has expanded beyond flower to include edibles, concentrates and vape cartridges. Improved dispensary access and broad product availability could increase the proportion of registered patients making purchases. As more growers and processors initiate business and dispensaries continue to open across the state, prices will likely continue to moderate as demand and supply come into alignment. While flower was priced at roughly $480 per ounce when sales began, some dispensaries are now advertising flower prices in the range of $300 per ounce. Market AtA Glance | Ohio When Ohio’s medical marijuana sales began in mid-Jan- uary, the prevailing news stories focused on high prices and low participation rates among registered patients. Prices trended around $480 per ounce for flower—the only product initially available—making it significantly more expensive than the $320 per ounce being charged at bor- der towns in neighboring Michigan, which offers reciprocity to out-of-state patients. Ohio patients reported turning to the illicit market or traveling across state lines to avoid high prices or time spent to reach dispensaries, as only four were operating in Ohio when the program launched. By the end of March, only 40% of registered patients had made a medical marijuana purchase. But as the program’s rollout has continued, prices have come down moderately and access has increased significantly. By the end of July, the patient participation rate had increased to 57%, generating $18 million in sales. During recent months, Ohio’s patient count has grown by an average of 282 each day; it now exceeds 50,000 individuals. Marijuana Business Daily estimates total sales in Ohio could reach $80 million to $100 million annually when the market matures. – Maggie Cowee