Ohio Cannabis Operators Warn: Regulatory Delays and Hemp THC Are Reshaping the Market

IgniteIt’s recent Ohio Cannabis Market Spotlight brought together regulators and stakeholders shaping the state’s cannabis landscape, and their insights painted a picture of an industry still finding its footing. As one of the event’s panel discussions revealed, licensed operators face shifting expectations, regulatory grey areas and mounting pressure from intoxicating hemp products while regulators work to finalize the state’s adult-use rules.

David Bowling, executive director of the Ohio Cannabis Coalition (OHCANN), moderated the discussion, titled “From Rules to Reality: The Next Phase of Ohio Cannabis Implementation.” Panelists included Andrew Makoski, chief legal counsel for the Ohio Division of Cannabis Control (DCC), and attorneys Greg May and Thomas Haren, who represent clients in the state’s cannabis industry.

Bowling opened by asking Makoski to assess the current state of regulation in Ohio. The regulator said that after voters approved adult-use cannabis in 2023, the DCC prioritized launching recreational sales, which began in August 2024. Because regulations were still being drafted, the division relied on the state’s medical cannabis rules to govern recreational sales.

“We adopted kind of a novel approach of operating under the medical rules, but allowing sales to adult-use consumers,” Makoski said, adding, “We did that in order to try to begin sales kind of as quickly as possible, and then the rulemaking has kind of been catching up.”

Makoski said the division is satisfied with early progress, though he acknowledged that significant work remains.

“We’re pretty happy with where things have been, knowing that there’s a lot still kind of left to come, and we have a real eye on the legislature—what happens with SB 56 or any of the changes that might come our way—so that we can kind of make the adjustments as we see them,” he said.

When Bowling asked Haren for his assessment, the attorney noted that progress depends largely on expectations.

“The market is doing much better now than it was in 2022, 2021, before we had adult use. So the ball has been moved forward,” Haren said. “But if you’re comparing it to what were maybe some unrealistic expectations that the market had about what adult-use would look like a year out, the market’s underperforming.”

Haren acknowledged that the DCC moved quickly to launch adult-use sales but said the speed introduced trade-offs, especially in regulatory clarity.

“We’re operating under the medical rules, sometimes under new rules when they actually go into effect, and then we’re operating under these guidance documents that the division issues, I don’t know, every couple of weeks, every month,” he said. “And that has proven, I think, to be very challenging.”

He added that operating under two regulatory models, combined with informal guidance, has created compliance hurdles for licensees. May agreed, recognizing the division’s efforts to adapt regulations as issues arose. He noted, however, that regulators did not meet the mandated deadline for adopting adult-use rules.

“They’ve worked very hard,” May said. “There’s been a lot of outreach to the stakeholders in the industry. They’ve really used that feedback to make changes to the rules, because at the end of the day, I think the division wants these rules to work just as much as the operators do.

“But the rules were supposed to be done by September 7 of 2024, and here we are, and we’re not there yet.”

Cannabis vs. Hemp THC

The discussion then turned to other regulatory pressures facing Ohio operators. May said unregulated intoxicating hemp products are one of the largest challenges for licensed cannabis businesses.

“By far the question I’m getting the most from clients over the last several months has to do with intoxicating hemp,” May said.

“To some clients, [it’s] an existential threat to what they’re doing right now,” he added.

Makoski agreed, saying the DCC aims to bring regulatory parity between cannabis and intoxicating hemp businesses.

“We’re going to expect them to adopt the same quality control standards, the same security standards, the same packaging and labeling standards, the same testing standards,” Makoski said. “The floor is going to have to come up. It’s not the other way around.”

Before Congress passed its ban on hemp-derived THC products last month, panelists discussed the possibility of federal regulation. Haren said federal legislation alone will not be enough without enforcement.

“If the federal government isn’t going to step in to enforce it, well then you need a state-level regulator who has a more granular understanding of the activities within that particular state,” he said.

May agreed, noting that Ohio’s hemp regulations currently lack retail-level rules, including age limits for intoxicating products. Even with federal legislation, he said, state-level enforcement tools are essential.

“Regardless of what the federal government does, we still need those retail regulations in our hemp bill to be able to enforce, because the federal government is not going to be counted on to enforce this,” May said.

Join Us at Upcoming IgniteIt Events

IgniteIt’s Market Spotlight events and flagship Cannabis Capital Conference in Chicago offer exclusive insight from thought leaders with their fingers on the pulse of the cannabis industry. As federal cannabis policy enters a pivotal phase, IgniteIt will continue to convene operators, investors, regulators, and policymakers shaping the industry’s future. We invite you to join us at our upcoming national and regional events:

New Jersey Policy & Capital Forum

February 10, 2026 — Jersey City, NJ

Missouri Policy Roundtable

April 2026 — Kansas City, MO

Chicago Cannabis Capital Conference ‘26

June 14–16, 2026 — Chicago, IL

Industry leaders, policymakers, and investors will reconvene for three days of capital-market insights, policy briefings, and strategic networking. For agenda details, registration, and scholarship information for minority- and women-owned businesses, visit https://events.igniteit.com/.