As Ohio Hits One Year Of Legal Marijuana Sales, It Has Potential To Be A National Model—If Key Regulatory Hurdles Are Overcome (Op-Ed)

“Ohio is in an ideal position to play a meaningful role in the normalization and acceptance of cannabis across the country.”

By Hirsh Jain, Verdant Strategies

As Ohio marks the first year anniversary of adult-use cannabis sales on Wednesday, there are varied perspectives on how the new cannabis market in the nation’s seventh-most populous state is faring.

One common sentiment is that the state’s industry is “underperforming”—that its per capita sales remain low, its product selection limited, its pricing too high, its regulations unusually strict and its retail access still sparse.

On their face, many of these observations are plainly true. However, there is also evidence that some of the challenges limiting the growth of Ohio’s cannabis market are slowly abating, and that the state has the potential for steady, but sustained, growth in its second and third years of adult-use sales and beyond.

This stable, somewhat “boring” growth trajectory, if realized, may distinguish Ohio from its neighbor Michigan, whose famously open, permissive cannabis framework Ohio seems to be consciously charting the opposite course—for better or for worse (or perhaps both).

If in the coming years Ohio is able to successfully execute on its vision of establishing a fairly controlled, yet still robust, cannabis market, it may find itself regarded as a “model” of sorts for legal cannabis in the United States.

Its population size, location in the Heart of the Midwest and enduring political relevance as a swing state suggest that Ohio has the potential to play a meaningful role in the normalization and acceptance of cannabis across the country—all the more reason the success of its market should be of great interest to the industry as a whole.

Slow Start

Over the past 12 months, Ohio has generated $1 billion in total cannabis sales. According to the Division of Cannabis Control (DCC), approximately 70 percent of these were adult-use sales and 30 percent were medical sales. On its face an impressive sales figure, Ohio’s cannabis sales seem far less impressive when compared to other states.

Take Pennsylvania, for instance. A medical-only state, also surrounded by adult-use states that capture sales from many Pennsylvanians—and with approximately the same size population as Ohio—Pennsylvania has in recent years averaged $1.5 billion in medical-only sales, dwarfing Ohio’s adult use market by more than 30 percent.

Or, take Missouri. A state with just half of Ohio’s population, Missouri generated nearly $1.5 billion in sales in its first year of adult use, with cannabis sales continuing to increase in the years since. Missouri thus also exceeded Ohio’s adult-use market by more than 30 percent, which is remarkable considering the substantial population difference between the states.

Limiting Factors

Cannabis sales have been comparatively muted in Ohio, in large part because many products that consumers want are simply not yet offered in the state’s legal market.

Puzzlingly, a year into adult-use sales, Ohio’s cannabis program is still operating under the state’s medical cannabis product regulations, while permanent rules for adult-use products are supposedly being finalized. Popular adult-use products like pre-rolls, which in some markets comprise nearly 20 percent of sales according to BDSA, are not yet sold in Ohio’s market.

Similarly, standard 3.5 gram (“eighth”) flower packages are not yet allowed in Ohio’s market. Instead, flower must conform to the medical system’s peculiar 2.83 gram (one-tenth ounce) limits. Predictably, many Ohio cannabis consumers seem unenthused about the prospect of buying a “tenth” of flower and continue to patronize the illegal market in Ohio, or the legal market in neighboring Michigan, where they can easily purchase a much more familiar “eighth” of flower.

The legal market in Ohio has also been hampered by high pricing. According to Headset, the average item price in Ohio is currently $34.64, four times the average item price of $8.54 in Michigan and nearly twice the average item price of $18.99 in California. This also turns many Ohio cannabis consumers to the illicit market, or to the legal market in Michigan.

Another key limitation for the legal cannabis market in Ohio is the limited retail access in the state. As of August 2025, Ohio had approximately 160 legal dispensaries open, serving a population of approximately 12 million people. As a comparison, California has twice the number of dispensaries per capita; Missouri three times the dispensaries per capita; Colorado four times the dispensaries per capita; Michigan five times the dispensaries per capita.

While populous cities such as Cincinnati, Cleveland and Columbus have a respectable dozen or more dispensaries, many smaller cities and more rural parts of the state have no or much more limited retail cannabis access. In this vacuum, intoxicating hemp products sold in abundant retail channels such as gas stations and convenience stores satisfy much of the demand for cannabis in the Ohio market, arguably rendering the “controlled” cannabis marketplace Ohio regulators are so intent on developing more fiction than reality.

The Ohio market is thus “underperforming” not because of any lack of demand for cannabis, but because the products consumers demand remain largely inaccessible or inconvenient within the legal cannabis system.

Challenges Receding

However, as Ohio enters its second year of adult-use sales, some of these challenges appear to be receding.

Later this year, Ohio’s Joint Committee on Agency Rule Review (JCARR) will review permanent rules for adult-use sales proposed by the DCC, which would allow the sale of popular form factors such as pre-rolls and standard “eighths” of flower. If approved, this will help licensed Ohio operators recapture some of the demand that has been diverted to the illicit cannabis market and to neighboring states.

The cost of legal cannabis has also dropped significantly in recent months.

According to the DCC, the average price of cannabis flower in Ohio is now $6.61 per gram, 30 percent lower than the $9.40 per gram average when adult-use sales began in August 2024. Though price compression in cannabis markets is often viewed negatively as eroding the margins of legal operators, pricing that is too high predictably cedes a significant portion of the cannabis market to illicit operators and those who sell intoxicating hemp products.

The lowering of prices should thus be welcome news to those who want to usher more consumers into Ohio’s regulated cannabis market.

New dispensaries are opening in Ohio as well. Of Ohio’s 160 dispensaries, more than 30 have opened in 2025, with the pace of store openings notably increasing in recent months. Many of these new stores have opened in cities or counties with previously limited retail cannabis access.

At its current pace, Ohio will have 200 dispensaries open by early 2026. By mid-2027, Ohio is anticipated to have more than 350 licensed dispensaries, bringing it closer to parity with successful adult use markets such as Missouri that have the requisite retail density to drive robust sales.

If one looks closely, the impact of these changes is starting to become evident in the data. In July 2025, Leaf Link reported that average sales per dispensary in Ohio increased from $5.2 million in fall 2024 to $5.8 million today, even with the increased number of retail licenses in the market. Considering that prices also dropped 30 percent during this period, it seems clear that Ohio cannabis consumers are increasingly patronizing the legal market and slowly foregoing the alternative markets in which they could obtain cannabis products more cheaply or conveniently.

The legal cannabis market in Ohio can thus be understood to be on a slow, steady upward trajectory. Whether it can sustain this growth in the coming years depends largely on the choices that regulators and policymakers make.

Challenges Remain

Ohio’s cannabis advertising regulations are notably stricter than those in states, banning billboards, radio and TV ads and promotional giveaways. Observers have noted that these rules were developed in response to Michigan’s more permissive advertising regulations, which allow broad latitude in outdoor and digital cannabis marketing.

Experienced operators in Ohio have been fined tens of thousands of dollars for minor advertising violations such as unapproved signage, promotional emails, and even the unauthorized use of the word “recreational” in marketing materials.

Stunningly, some cannabis consumers in Ohio have reported they were unaware that adult-use cannabis sales had even started, a reflection of the impact of these onerous advertising restrictions. Other consumers remain unclear on where exactly in their city legal dispensaries are located, given the restrictions on signage and marketing, depressing traffic to these legal cannabis outlets.

Ohio subjects advertising regulations to close oversight by the DCC and JCARR—making significant loosening of these restrictions unlikely in the near future.

Still, regulators and policymakers are surely aware that the ubiquitous intoxicating hemp market in Ohio is not subject to the unduly strict advertising regulations its regulated cannabis businesses must comply with. In order to actually realize their vision of establishing a properly controlled cannabis market, Ohio regulators must finally give their regulated cannabis businesses a fair chance to compete for consumer attention with their less regulated counterparts.

This can only happen if the DCC and JCARR acknowledge the need to reform Ohio’s advertising rules.

As Ohio Goes, So Goes The Nation

When Ohio voters legalized adult use cannabis by a 57-43 percent margin in November 2023, observers noted the broad bipartisan support for legal cannabis the vote revealed. Exit polling showed support amongst urban voters (65 percent), suburban voters (52 percent) and rural voters (54 percent). Conservative counties in rural, Appalachian Ohio— such as Lawrence County, Meigs County and Vinton County—voted in favor of legal weed, just as did large, urban counties—such as Cuyahoga County, Franklin County and Hamilton County.

This helps explain why proposals in the state legislature to modify Ohio’s cannabis law, for example by doubling the tax on legal cannabis from 10 percent to 20 percent, have thus far been met with resistance by representatives of both parties. Even at the federal level, elected officials in Ohio have emerged as champions of legal cannabis—with Rep. David Joyce (R-OH) and Sen. Bernie Moreno (R-OH) designated as key point persons on federal cannabis reform efforts in the 119th Congress.

Ohio is thus in an ideal position to play a meaningful role in the normalization and acceptance of cannabis across the country. If in the coming years Ohio is able to successfully execute on its vision of establishing a fairly controlled, yet still robust, cannabis market, it will find itself with even greater reason to advance the cause of the industry as a whole.

And should Ohio be able to illustrate that cannabis reform is not only a significant economic driver, but also has the ability to help address social and public health issues—such as the opioid crisis that has hit Ohio as hard as any state in the country—the case for legal cannabis becomes even stronger.

It is said that as Ohio goes, so goes The Nation. And so, if Ohio’s nascent experiment with legal cannabis flourishes and reaches its potential in the coming years—as we believe it will—so too we might expect the same to happen in this country as a whole.

Hirsh Jain is the Director of Market Intelligence at Los Angeles-based Verdant Strategies, a financial services and solutions company whose list of national cannabis clients includes operators in Ohio. He is also a principal at Los Angeles-based consulting firm Ananda Strategy.