Ohio’s new medical marijuana laws brings bevy of business opportunities
One year away from full implementation, Ohio’s medical cannabis sales are projected to be between $200 and $400 million once the system is fully matured. That market is expected to bring a bevy of business and jobs to the state, and entrepreneurs are eager to take advantage of those opportunities.
Currently, however, the medical marijuana market presents uncertainty for those hoping to enter it. Signed into law in June 2016, the only immediate effect of Ohio’s law was that those who were found in possession of marijuana and an authorizing doctor’s note were within their legal rights. The law still lacks in the implementation guidelines for growing, processing, testing and selling medical marijuana, despite that the system is planned to be fully operational by Sept. 8, 2018. And Ohio doctors, unfamiliar with Ohio’s laws and with prescribing medical marijuana, largely express a resistance to offering medical cannabis to their patients.
Ohio’s medical cannabis market by the numbers
The prediction that Ohio’s medical marijuana market will balloon to between $200 and $400 million in annual sales comes from industry publication Marijuana Business Daily. According to industry experts, Ohio could become a national “powerhouse” for the medical marijuana industry, largely because of its population — it’s the seventh largest state — and because the broad list of conditions eligible for treatment with medical marijuana includes “pain.”
Based on a comparison with other states’ medical marijuana markets, the industry experts at Marijuana Business Daily believe that Ohio will see between 1 and 2 percent of its population utilizing medical marijuana. Based on that, the initial market is expected to include 100,000 Ohioans, with the market expanding to more than 230,000 Ohioans within a few years.
Medical cannabis industry opportunities in Ohio
Under the state’s medical marijuana laws, there are several state-sanctioned business opportunities available. Sectors eligible for state licensing under Ohio’s laws include:
- Cultivators. Ohio will issue 24 medical marijuana cultivator licenses, 12 for small growers of 3,000 square feet or less and 12 for growers of up to 25,000 square feet. Applications for cultivators were due to the state in June, but the state has yet to announce who and where the cultivators will be.
- Processors. Up to 40 processors licenses will be issued to those who will turn Ohio’s marijuana into legal oils, tinctures and edibles. The state has not yet announced fees, deadlines or the procedures for applying to become a licensed processor.
- Testing laboratories. The state also will license medical marijuana testing laboratories. There has not been a limit placed on the amount of those licenses to be issued.
- Dispensaries. Up to 60 dispensaries will be authorized by the state. The process and fees for determining licensed dispensaries have yet to be determined. Some Ohio municipalities have voted to ban dispensaries, but many of those bans are being lifted in light of the tax dollars they might bring.
The Ohio state departments that are charged with developing and overseeing the licensing of the cannabis industry — the Department of Commerce, the Medical Board and the Board of Pharmacy — have a deadline of Sept. 8, 2017 to finalize the application process for processors, dispensaries and testing laboratories.
Once the state’s medical marijuana program has been fully implemented in 2018, those boards also will be charged with determining if more licenses should be allotted to meet the demand for medical marijuana within the state. It is important to note that industry experts say Ohio should be prepared to expand their licensing program based on market projections.
Of course, there are business opportunities related to Ohio’s medical marijuana market that go beyond those licensed by the state. Those in the medical marijuana field say there is a need for software development, security, legal matters and packaging to support the industry.
The uncertainty around medical marijuana prescriptions
Beyond licensing, the other great unknown in Ohio’s medical marijuana market involves Ohio physicians and how accepting they will be of medical marijuana. Of more than 3,000 doctors surveyed last year by the Ohio State Medical Board, only 30 percent of doctors expressed some readiness in providing their patients with medical marijuana prescriptions, and a full 45 percent of doctors responded that they will not recommend medical cannabis to their patients. A number of physicians also reported that they do not expect their employers to take advantage of Ohio’s new medical marijuana laws.
That could leave the 188,000 Ohioans expected to sign up for the medical marijuana program searching for a doctor willing to issue prescriptions. That could send Ohioans out of state to find doctors to fill their needs.
This scenario can be found in state after state with recently passed medical marijuana laws: Despite the legalization, physicians are not completely on board, which impedes the implementation of medical marijuana programs.
Of course, over time doctors could be more likely to consider prescribing medical marijuana as they explore and become more familiar with medical marijuana and how it could benefit their patients. In Ohio, the state has yet to determine the continuing education courses and the certification process that will be required for doctors who wish to be able to offer medical marijuana prescriptions. Establishing those guidelines — and familiarizing doctors with those guidelines — likely will make more physicians open to prescribing medical marijuana.
The future of medical marijuana in Ohio
As guidelines are put in place and uncertainty diminishes, Ohio’s medical marijuana market can be expected to see a good deal of growth. Nationally, medical cannabis market is expected to grow 700 percent by 2020. With Ohio’s large population and generous list conditions that are eligible for treatment with medical marijuana, it can be expected that Ohio will see a good portion of that growth.
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