Under Ohio’s newly legalized adult‑use and existing medical cannabis programs, distribution—transporting cannabis products between licensed facilities—requires adherence to a rigorous regulatory process overseen by the Division of Cannabis Control (DCC) within the Ohio Department of Commerce. This article outlines the steps, legal thresholds, and compliance obligations for cannabis distribution businesses operating in the state.

Regulatory Authority and License Types

The DCC issues and regulates licenses across the cannabis supply chain: cultivators, processors, testing laboratories, dispensaries, and also oversees distribution activities under the adult‑use framework. Distribution does not require a separate categories-based license; rather, licensed cultivators and processors can transport products to testing labs and dispensaries under strict regulatory oversight.

Eligibility Requirements and Application Process

Entities eligible for distribution must hold an appropriate cultivator or processor license. Under adult‑use regulations, eligible applicants include existing medical licensees who may seek dual‑use status, and entities that qualify under the “10(B)” drawing‑based dispensary license program.

Applicants must:

• Disclose ownership structures and investors.
• Certify no disqualifying criminal history (drug felonies, theft, moral turpitude within the past five years).
• Demonstrate facility compliance with zoning laws (e.g., >500 feet from schools, parks, churches).
• Ensure no conflicts exist with testing laboratories (no shared ownership or management).

Fees and Site Approval

Distribution applicants must pay a non‑refundable $5,000 application fee under 10(B) rules. Medical processors already licensed pay a $70,000 certificate of operation fee and $5,000 application fee, with $70,000 biennial renewals.

A two‑phase site review applies: Phase One involves submitting a proposed location; Phase Two includes detailed documentation demonstrating regional district alignment. Applicants must wait on random ranking assignments in the drawing before advancing.

Inventory Tracking and Compliance

All distribution of cannabis products must be managed through Metrc, Ohio’s mandated statewide tracking system, which enforces daily reporting of inventory movements, batch numbers, transport logs, and licensee actions.

Compliance standards include:

• Daily logs of product transfers.
• Secure transport with surveillance and tamper‑evident packaging.
• Documentation specifying origin, destination, strain, batch, amounts, personnel, timestamps, and transaction IDs.

Inspection, Monitoring, and Ongoing Requirements

Licensees are subject to routine inspections by the DCC. They must maintain secure facilities with surveillance, update policies on transport and security, and comply with taxation obligations (10 % adult-use sales tax plus local sales taxes). Operators must also remain current with license renewals, biennial certificate renewals, and updated rule notices, especially those affecting social equity licensees.

Timeline and Social‑Equity Considerations

Initial dual‑use conversion applications opened around June 7, 2024, and provisional licenses were expected by September 7, 2024. Additional 10(B) license rounds prioritize social‑equity participation via the Cannabis Society Equity and Jobs Program.