Prices Are Higher Than Patients. Will Ohio Medical Marijuana Prices Ever Drop?
Updated: Aug 7, 2019
We have heard you all -- the prices are high af!
Roughly $50 for 2.83 grams is a lot of gold coins to spend for less than an eighth of legal cannabis. And yes, you read that right -- Ohio sells cannabis by the tenths (considered a daily dose). Mind you, you are not limited to one daily dose per visit. In fact, you can buy up to a 90-day supply in one go, but that would be rather expensive! The Ohio Tenth was the standard daily amount determined by the State of Ohio, not the Ohio cannabis industry. Even to us industry professionals, the Ohio Tenth is a serious headscratcher that poses more than a handful of logistical nightmares.
As a patient myself, the prices were certainly a painful bit of sticker shock when I approached the counter and saw just how much I would be (or would decide against) spending to buy Ohio medical marijuana. That's why, in this latest volume of Rumor Control, we will be discussing the admittedly high prices of medical marijuana in Ohio. We'll also explore when to expect those prices to drop.
Rumor: There is a weed monopoly
The support team at Ohio Marijuana Card has heard the "weed monopoly" line a few times from patients, and those people are right. There was a weed monopoly proposed in 2015. Issue 3, promoted by the group Responsible Ohio, was a recreational marijuana bill that would have locked cultivators to just ten facilities, all controlled by the same investors. The whole gambit would have created a closed system that ultimately would have paid little back to the state, or to Ohioans.
Voters balked at the ideas proposed in Issue 3, and the amendment was passionately voted down in the fall of 2015. It did, however, manage to gain enough of a vote that Ohio lawmakers took notice that pot was an issue growing in popularity among residents of the Buckeye State, and on both sides of the political aisle.
After this issue failed, Ohio lawmakers decided to create their own bill that legalized cannabis for medical use. This bill, Ohio HB 523, is the reason dispensaries have now opened. Though there are a limited number of dispensaries (around 60) and cultivators (27 in Ohio), everyone was allowed to apply for a license. The best scoring candidates won provisional licenses and were allowed to proceed with building their facilities.
Honestly -- and this is for better AND worse, mind you -- but if Ohio did have a monopoly, the rollout of Ohio medical marijuana would have gone much smoother. Every company would have been aligned. Inspections would have been done at the same time. There would be smarter coordination between businesses and the state. There would be less legal hurdles and less red tape. A weed monopoly would have rolled out all on the same day, lines would run smoothly, supplies would be plentiful ... and prices would probably be higher than they are now.
But that is not the case with Ohio weed. Cultivators were allowed to submit applications to the State of Ohio for review. There were 27 separate cultivators selected for now, including 13 small scale (less than 5,000 plants per harvest) and 14 large scale (5,000 plants or more per harvest).
At current, however, only three of these cultivators have operating licenses, and are up and fully running. More cultivators are coming, with many opening this spring, but they are still in the process of finalizing their facilities, harvesting or prepping their cannabis. And some have yet to even begin cultivation. But there will be more, it will just take time.
Having only three cultivators translates to limited strains, limited quantities of each strain, and less cannabis overall. Once again, that will change soon. But because there are a limited number of cultivators operating, it may look -- to the laymen -- like a monopoly. Though that isn't the case with Ohio's MMJ program, it's easy to see why so many people have made that misinterpretation.
There was a marijuana monopoly bill in 2015. It was shot down by voters. Ohio's current law has granted licenses to 27 separate cultivators throughout the Buckeye State. At current, only three have operating licenses, but more cultivators, more marijuana and more strain diversity is coming very soon.
Rumor: Prices will not drop
As we noted earlier, prices are currently around $40-60 for roughly 2.83 grams of cannabis. Generally, most strains run $50 for one-tenth, with just a few that run lower or higher. But why exactly are the prices so high? After all, the black market is selling cannabis for much cheaper (around $20-50 for an eighth). Won't high prices simply encourage black market sales?
This problem has presented itself during the launch of every single marijuana program throughout the United States. It all boils down to a mixture of supply and demand, supply shortages, and limited availability. But, as each problem is solved, prices gradually drop.
At current, there are only three cultivators selling cannabis at dispensaries. As a result, there is a limited supply of cannabis available to patients. And because cannabis takes a while to grow, harvest, dry and prep for sale, running out of cannabis could mean that dispensaries would be forced to close for several weeks until cannabis supplies returned.
Lower prices would cause too many sales and lead to supply shortages. While higher prices may drive away many customers in the short term, it also keeps supplies in dispensaries, allowing companies to serve as many patients as they can without fear of running out of every strain. As more cultivators enter the market, and more strains and more cannabis are sold, we should see a dramatic drop in prices.
And this may happen soon as cannabis sales were a bit on the low side for opening day. According to Ohio's medical marijuana control program, legal cannabis sold a mere 8.7 pounds on the first day, totaling $75,000 in sales or roughly 1400 daily units sold. If sales continue to remain slow, and supplies build up, we may see a price drop before other companies, and more bud, even enter the market.
Unfortunately, if you are a patient on a fixed income, this may mean that -- for right now -- you will may not be able to afford cannabis (or will be limited in what you can buy), at least legally, from a dispensary. Our team at Ohio Marijuana Card is working with some companies to try and solve this dilemma for our patients, but know that prices will drop. As this is an open market, and Ohio Marijuana Card is only a physician's office, we cannot control the prices or make changes to them ourselves. Each individual cultivator and dispensary has to make that decision.
As for black market sales -- they are expected to persist throughout the program's run. Ohio did little to stop the sales of illegal cannabis with this medical marijuana bill. As a result of higher prices, and a lack of thoughtful legislation, black markets sales are likely to spike in the short term, but return to normal after prices drop.
Quite frankly, people like growing cannabis as a hobby, and that isn't stopping anytime soon. A better solution to curb black market sales would be to allow patients to grow their own cannabis at home. If a patient can grow, they are less likely to purchase their cannabis from an unknown source. Buying cannabis on the black market in states where cannabis is legal is often a sign that prices are too high and patients are buying from other sources as a means of desperation. Home grows would have helped fix that. With some luck (and legal challenges), Ohio may reconsider this regulation at some point. As always, we'll keep you updated if they do. Don't hold your breath, though.
The prices are high so that there are not supply shortages, which would mean no medical marijuana for any Ohioan. As more cultivators enter the market, and supplies grow, prices should drop dramatically.
If you are an Ohioan suffering from one of these 21 medical conditions you may be eligible to treat your ailment with medical marijuana, which includes both THC and CBD products.
Click here to learn more about what Ohio Marijuana Card's state-certified medical marijuana doctors can do for you, or give us a call at 1-866-457-5559 and our friendly support team can walk you through the entire process, and set you up with an appointment.
Also, be sure to check out our latest episode of Ohio Marijuana Pod!