Medicinal Marijuana’s High Price Tag Could be Trouble for Ohio

January 16th was the first official day of medicinal marijuana sales in Ohio. The four currently-operating dispensaries sold a combined total volume of 8.7 pounds of marijuana for $75,000 – or roughly $500 an ounce.

This is more than five times the illegal market value.

While states like Michigan and Colorado are pushing illegal dealers out of business by undercutting the market, Ohio’s prices could actually make illegal marijuana more appealing.

Of the 32 states in which medicinal marijuana sales, Ohio has some of the most stringent requirements and regulations. Each business must account for and comply with regulations at every stage of the development process. In addition, they must be able to digitally track and account for every plant developed.

In addition to the self-policing regulations, testing and verification of all product developed must be completed by third parties. These tests cover everything from the amount of THC to the type of pesticides used in development.

After complying with these regulations, the state then has a fee structure that is both complex and costly. The most expensive is a seventy thousand dollar “operation certificate fee” that is due every two years. Even hiring an employee is a five hundred dollar charge. While many marijuana advocates have argued that marijuana should be legalized and taxed heavily to stimulate economic development, the taxes are so high that many people could simply get a marijuana prescription, buy marijuana illegally, and, at glance, no law enforcement would be able to tell the difference.

Even if these issues can be remedied, as marijuana is still illegal in the eyes of the federal government, most banking institutions will not service marijuana dispensaries. This has led to stores hoarding cash in back rooms and bags. Ohio is expected to generate $300 million in revenue, every year. Keeping this much money out of any financial institution could make accountability extremely difficult as well as have a negative effect on local economies. Some states and national legislators have attempted to pass legislation that would provide protection for dispensaries, though these efforts are irrelevant for as long as the federal government recognizes marijuana as a Schedule 1 Narcotic.

It is likely that the most excessive restrictions will be phased out in a matter of years. An important aspect of making the case for marijuana was the promise that it could be done responsibly and with the highest levels of accountability. Once Ohioans see that these standards are being met, it is likely that industry advocates will successfully roll back the most onerous regulations.

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Andrew Shirley is a reporter at Battleground State News and The Ohio Star. Send tips to [email protected].







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