Despite Gov. Mike DeWine’s (R) opposition to cannabis legalization, Ohio Secretary of State Frank LaRose (R) announced in late January 2022 that an initiative proposing the legalization of cannabis had submitted enough valid signatures to be presented to the state legislature.

The initiative would have enacted a state law to legalize the cultivation, processing, sale, purchase, possession, home growth, and use of recreational marijuana for adults 21 years of age or older.

The legislation ultimatley failed and petitioners were required to collect 132,887 additional signatures if they wanted to place the measure on the November 2022 ballot. In May 2022, the campaign reached a settlement with the state to abandon the effort for 2022, but instead put the signatures and upcoming efforts towards the 2023 ballot. On August 16, 2023 the campaign submitted 127,772 additional signatures, which will now place the proposal on the ballot in November 2023.

While Ohioans wait for adult-use legalization, the state is making strides to increase access to the current medical market. Licensed cultivators can apply to double the canopy size from 25,000 sq. ft. to 50,000 sq. ft. for Level 1 and from 3,000 sq. ft. to 6,000 sq. ft. for Level 2 operators.

July 2023 | AYR Wellness announced it entered into an option agreement to acquire Twice Wellness

December 2022 | Vext Science announced its acquisition of Appalachian Pharm Processing for $13MM

October 2021 | Acreage Holdings acquired Green Leaf Gardens LLC cultivation, processing and retail operations in Ohio

July 2021 | Verano acquired Mad River Remedies

July 2021 | Columbia Care acquired four dispensaries from CannAscend for $14MM

March 2021 | AYR Strategies acquired cultivator Parma Wellness Center LLC in a $17MM cash deal

The medical market expansion is underway. Regulators will allow the licensed cultivators to apply for canopy expansion from 25,000 sq. ft. to 50,000 sq. ft. for Level 1 and from 3,000 sq. ft. to 6,000 sq. ft. for Level 2 operators. The narrow canopy limits have constrained the market, and with 73 new dispensary licenses issued, expansion is imperative.

Investors have ample opportunity to invest in attractive ROI projects over the next several years as the medical market expands and ultimately transitions to adult-use.

Existing license holders should solidify their market positions and hold on for a fun ride especially as November edges ever closer.