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The Massachusetts cannabis industry is a billion-dollar enterprise, with over 700 retailers operating across the state. Yet stores are closing, companies are firing their workers and retail and non-retail licenses are being surrendered by former operators as business owners clamor for regulatory changes to transform an industry they see as unsustainable.
The changes are taking place as the Cannabis Control Commission, created in 2017 to regulate the new recreational cannabis industry, has been at the center of controversy, leading to delays implementing necessary regulations.
House Speaker Ron Mariano, D-Quincy, has suggested restructuring the commission is a priority item. But some industry observers wonder if those changes may be too little too late.
The CCC’s acting chair defends their recent pace.
“This is a very entrepreneurial industry, and I fully acknowledge that regulators aren’t usually organized and structured to respond as fast as an industry might like, but I think what you’re seeing is a lot of collaboration … and a lot of energy into tackling some of these issues and hopefully doing it this year,” said Bruce Stebbins.
The CCC started introducing changes license holders had been asking for late last year. These include eliminating the “two-driver” rule, allowing microbusinesses to have retail and transport licenses, and permitting patients to request a telehealth consultation for their initial certification. The CCC has also said it will regulate social consumption in early 2025. This measure has been requested by business owners for years.
Brink of closures
But industry players say key issues remain unanswered.
“When the industry is really on the brink of closures, you need a little bit more speed with which the regulatory agency is implementing things,” said Ryan Dominguez, executive director at the Massachusetts Cannabis Coalition.
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The current regulations have placed financial strains on operators, added Jeffrey Herold, CEO of Green Remedies Cannabis, one of the biggest cannabis companies in Massachusetts.
“Stores aren’t just closing because action was slow; they’re closing because the current regulatory environment isn’t sustainable,” Herold said.
As it stands, the current state of cannabis regulation has led business owners to believe operators will continue to close throughout 2025 and beyond.
“We’re going to see more and more of these smaller operators having to close their doors,” Dominguez said.
One of the biggest ills for the cannabis industry is market oversaturation, owners said.
“The state keeps issuing new licenses without evaluating supply and demand. Businesses are struggling because there’s too much competition in a limited market,” Herold said.
Since its inception, the CCC has granted 1,465 licenses. As of Feb. 14, 19 more are pending approval.
The oversaturation has led to prices falling dramatically, industry players believe. The average cost of an ounce of cannabis flower has gone down from $416.09 to $125.47 between January 2020 and January 2025.
Comparatively, the price for an ounce of flower in Michigan — which approved the use of recreational marijuana in 2018 — is $66.50, according to the Michigan Cannabis Regulator Agency. Meanwhile, the price of a half-ounce of flower in California stands at $55.97, according to the state’s Department of Cannabis Control.
“This race to the bottom is hard to survive. That is why we are seeing retail stores closing. They can’t survive with these margins,” said David Logan, director of operations and facilities at Trade Roots.
After recreational cannabis was legalized, investors sought to make their own production facilities and join the industry. However, these facilities came online at the same time other states started approving the legal use of recreational marijuana.
This led to a decrease in demand, oversupply and prices dropping, said Brandon Pollock, CEO of Theory Wellness.
“You’re not seeing a price decrease because people are getting better at what they do. You’re seeing price decrease solely for the fact of people being desperate,” said Angela Brown, CEO of Coast Cannabis Co..
Some business owners, like Herold and Logan, believe it would be best for the market if the CCC stopped approving new licenses.
“Now is the time for the CCC and the Statehouse to put a pause on [new licenses],” Herold said. “By not doing so, you’re creating more hope and dreams for individuals that are probably going to lose it all once they get there.”
The CCC is not currently considering a license cap. It believes the market itself will drive the ability for new players to join the industry, Stebbins said.
Testing
Testing is one of the biggest issues business owners are dealing with.
“The current testing system was inherited from the from Department of Public Health medical marijuana program,” Pollock said, believing it needs an overhaul after years of not being updated.
Tests are not standardized across different labs, leading to different results, increasing costs for businesses and confusion for consumers, Dominguez said.
Current tests look for yeast and mold in cannabis. However, business owners feel tests should be tailor-made for every different species of marijuana used and looking for different harmful elements in them.
“The total yeast and mold [test] is not an accurate one because of the fact that it doesn’t really get into the things that are harmful pathogens for consumers, like Aspergillus,” Dominguez said.
The CCC has taken note of this problem. Commissioner Ava Callender Concepcion has been assigned to address the problem in depth and a newly appointed director of testing has already started working on the subject, Stebbins said.
Agent registration cards
Another struggle affecting the industry is agent registration cards.
Any person working in any marijuana establishment must obtain registration cards from the CCC. Applying for these cards costs $500 for medical agents and $115 for recreational agents. Cards must be renewed annually at first and on a triannual basis afterward, industry sources said.
A person working at multiple facilities needs a separate card for each locale, inflating costs.
“Our general managers need to have access to all three of our dispensaries, which hold medical and recreational licenses. This means their badges cost $1,845 to renew,” said Samantha Woodman, manager of sustainability and regulatory affairs at Green Remedies.
The costs these cards carry is made more severe by the high turnover rate the industry faces.
“You’re going to be spending money for people who may never show up to the job, or people who stay for a week or two and then leave,” Dominguez said. “Things that they can be putting towards making their businesses more viable if they’re spending on inefficient processes like this one.”
The current system leads to thousands in costs for operators. Industry players believe only one card should be required, Dominguez said.
The CCC is already analyzing this problem.
“We know this is an issue that kind of is impacting everybody in the supply chain, from retailers all the way up to cultivators, even out to testing labs, even out to even some of our roadside drug testing trainers. So, we’re looking at that,” Stebbins said.
Purchase limits
Another struggle currently affecting the industry is purchase limits. Customers can only buy up to 1 ounce of cannabis flowers, 5 grams of cannabis concentrates and 500 mg of THC in edible products. This has led to stores overstocking products.
Meanwhile, neighboring states have more permissive restrictions. In Maine, customers can buy up to 2.5 ounces of cannabis per store visit and up to 10 grams of concentrates per day. In Connecticut, the limit goes up to 1.5 ounces of cannabis flower and 12 grams of concentrated cannabis.
“We turn away customers every single day,” Pollock said. He believes increasing the limit is the No. 1 one regulatory change needed to help the market stay afloat.
The daily limit mostly affects people who come from out-of-state to purchase the product. People on vacation to Massachusetts, or who were loyal customers and come back to the state to visit their store of choice, are not expected to go to a retailer a second day to buy the original amount they wished to purchase, Pollock said.
“A lot of people are not selling a lot of product,” Herold said. “A lot of people are selling for below cost right now, because they’re so desperate to keep the lights on.”
Herold believes this has a floor, though, which may hit the industry in less than a year’s time and will lead to a larger wave of companies going out of business.
Advertising
Another issue business owners struggle with is existing advertising restrictions.
According to CCC regulations, advertising through television, radio, internet, mobile applications, social media, billboards and print publication is restricted unless at least 85% of the audience is expected to be 21 years of age or older.
“The issue is we can’t attract new customers,” Brown said.
After the ballot question legalizing recreational cannabis was approved, there was an expectation from the industry that it would be treated in the same way as liquor is nowadays, Brown said.
However, cannabis stores cannot promote prices going down in their websites and cannot send newsletters to interested subscribers about new deals being offered.
“You can’t even cross out a number and say we’re offering it at a lower price, because that would be considered sales and discounting,” Dominguez said.
Store owners feel like their business is still being treated as an illegal activity, Herold said.
The CCC is aware of the changing cannabis industry landscape and the need for an updated regulation. The commission looks to modernize the current framework and give Massachusetts the intended results while complying with public health and safety standards, Stebbins said.
“There’s a lot of talking, but there’s not a lot of action that we’re seeing,” Brown said.
Gabriel O’Hara Salini writes for the Gazette as part of the Boston University Statehouse Program.“}]] The Massachusetts cannabis industry is a billion-dollar enterprise, with over 700 retailers operating across the state. Yet stores are closing, companies are firing their workers and retail and non-retail licenses are being surrendered by former operators as business owners clamor for regulatory changes to transform an industry they see as unsustainable. Read More
