While smoking was not a legal form of marijuana consumption under Ohio’s medical program, that was legalized with Issue 2.
This is an area of some frustration for the industry. Operators say customers are looking for these products and don't understand why they aren’t available yet.
There are regulatory rule packages under consideration now to allow for the manufacture and sale of pre-rolls. According to those rule packages, regulators are referring to those as “single serving units."
But when those rules will be written and then implemented remains a moving target.
DCC has not commented on any timeline for when pre-rolls could hit store shelves, and DCC Superintendent Jim Canepa declined to discuss this or regulators’ other top priorities on the policy front.
According to a snapshot analysis by Headset, a provider of cannabis market data, pre-rolls accounted for more than 15% of all cannabis sales in the U.S. in August 2023 as well as one-third of sales in Canada.
Pre-rolls are also viewed an entry point for many consumers new to a legal cannabis market as well as a potential draw for people sampling new flower strains. Not having them means missing out on potential sales and continuing to lose customers buying cannabis from the illicit market or neighboring states like Michigan.
“If you can’t get pre-rolls and you want them, you are going to go somewhere else to get them,” Maloof said. “And if you can walk into a dispensary and get them, there is a good chance that you make purchases of other products, too."
Based on how the rules have been coming together and his discussions with regulators, Maloof said that he’s optimistic pre-rolls could be available for sale in late April.
Operators say that Ohio has some of the tightest restrictions in the country on marketing and advertising for legal cannabis.
Regulators have been adamant that they don’t want Ohio to look like Michigan, where colorful billboards for marijuana dispensaries pepper highways and main roads.
“Advertising is important to create awareness in a new industry, but nobody wants to hit a barrage of billboards like you see crossing into Michigan,” Jason Erkes, spokesman for Cresco Labs, a Chicago-based multi-state operator, told Crain’s. “We’re optimistic the regulators will find a happy medium of an appropriate way to market the cannabis industry.”
What cannabis companies can say or show when it comes to ads and promotions is extremely limited. And any messaging that is permitted must be approved by regulators first, which can be a cumbersome process of its own.
Slang terminology is not allowed, for example, as well as referring to the market for adults 21 and older as anything besides “non-medical”— so no one can actually refer to a rec market in messaging.
Meanwhile, online ads are restricted, and commercials on TV or radio are forbidden.
Even signage outside a dispensary is heavily limited. Most stores are allowed only to have signs with their names, and they can't explicitly say "marijuana."
This frustrates cannabis companies that yearn to be regulated similarly to the alcohol industry — the campaign behind Issue 2 was known as the “Coalition to Regulate Marijuana Like Alcohol,” after all — which is not prevented from advertising on billboards or selling clothes with Budweiser or Corona logos.
In the run-up to the launch of adult-use sales, a handful of companies were hit with fines for breaking DCC’s advertising rules. Some cases involved dispensaries offering food outside their stores, which current rules do not permit.
Companies are looking for regulators to loosen some of these restrictions. One request is to eliminate the need to secure DCC approval for anything that might fall into advertising or marketing and to just have businesses comply with guidelines set forth, or face repercussions as necessary.
“In today’s day and age where people are barraged with information — whether it’s advertising on your phone, social media sites, on your TV or driving down the street — it can be hard to break through to deliver your message,” Haren told Crain’s. “And while that is not a problem unique to cannabis, what is unique are the restrictions placed on content and the medium of advertising.”
Advertising is all the more important because of the still-early stage of Ohio’s marijuana program. Businesses bemoan that the average consumer is still not even aware that Ohio has a functioning adult-use program or that there might be a dispensary close to them.
General awareness of the program and public acceptance of it, Bowling said, are two of the greatest headwinds to the Ohio industry right now. Removing some of the restrictions on marketing and advertising could help address this.
“People don’t know there are dispensaries out there and that you can go buy safe, tested, regulated cannabis from them,” Bowling said. “The acceptance piece is a long-term game that will come with time."
Separately from regulatory rules that DCC will put in place, licensed marijuana operators are hopeful that lawmakers will move to restrict the availability of so-called intoxicating hemp products.
These products include items like vapes, edibles or gummy candies purportedly infused with compounds like Delta 8 THC extracted from what may be legally grown hemp as well as what’s often marketed as hemp-derived THCA flower.
All of these items can be commonly found today at smoke or wellness shops, gas stations, and beer, wine and liquor shops. DoorDash will even deliver them.
There are also no prohibitions on who can purchase them, which raises concerns about sales of these products to minors.
Besides potential health risks, licensed marijuana companies assert that intoxicating hemp products actively undermine the industry for legal, regulated cannabis.
This is why “intoxicating hemp has to be dealt with,” Bowling said.
“There is no question that if this continues to exist, it will hurt the (legal marijuana) industry,” he said. “And there is no reason why a product line that is the only unregulated thing that I can come to think of should be allowed to exist out there. If people want hemp products to exist, then it should be treated exactly the same way as our regulated cannabis. It’s actually insane to me that it’s gone on this long.”
While Ohio is among a minority of states that have yet to regulate the sale of intoxicating hemp products, there seems to be some growing momentum behind changing that.
“If it has THC, whether it is from hemp or something someone created in a test tube in a laboratory, it should all be regulated the same way,” Huffman told Crain’s.
"Our caucus needs to decide how it is we want the system to go,” he added, noting that’s a work in progress. “I think we need to get it done before we leave in June (for summer recess). I think we can get it done.”
