The Michigan Cannabis Market Hits a New Low.

The Michigan Cannabis Regulatory Agency (CRA) is calling on the state Legislature for greater authority to address growing concerns within the industry. During a public meeting, CRA officials highlighted three major issues: the prevalence of large-scale illicit growing operations, a rising number of unreliable or fraudulent testing results from licensed labs, and the widespread sale of unregulated hemp-derived products with high THC content. The CRA believes that new laws are necessary to protect the integrity of the regulated market and ensure public health and safety.

The CRA’s request for more authority stems from loopholes and limitations in existing laws. The agency’s Executive Director, Brian Hanna, has pointed out that current statutes, such as the Michigan Regulation and Taxation of Marihuana Act (MRTMA) and the Medical Marihuana Facilities Licensing Act (MMFLA), do not give them the full power needed to effectively police the market.

For instance, the CRA lacks the ability to immediately suspend a license for serious offenses and faces challenges in prosecuting large-scale, unlicensed grows due to how personal cultivation is defined in the law.

A central issue is the rise of hemp-derived products, which can have high levels of intoxicating cannabinoids and are sold in unregulated spaces like gas stations, bypassing all cannabis regulations and taxes.

• Illicit Activity: The CRA has identified that provisions in the MRTMA make it legally challenging to shut down large-scale illicit grows. This creates unfair competition for licensed businesses that must follow strict rules and pay taxes, while the illicit market avoids these costs.
• Testing and Fraud: The CRA has seen an increase in “lab shopping,” where licensees send products to multiple labs and only use the most favorable results. To combat this, the CRA is advocating for a bill to allow them to operate their own Cannabis Reference Lab. This would enable them to conduct independent verification tests and investigations to ensure accuracy and compliance. This proposal is currently in a legislative committee. You can find the proposed bill details in House Bill 4501 of 2025.
• Hemp-Derived Products: Regulators are concerned about products sold under the guise of hemp that contain intoxicating levels of THC, bypassing all age and safety regulations. These products, often found in convenience stores, are a public health risk, and the CRA has shown examples of products with THC levels far exceeding what is allowed in the regulated market. They are pushing for legislation to close this loophole. This issue is being addressed in proposed legislation like House Bill 4967 of 2025.

Read this article about the new proposed laws (October 2025)

Q: What is “lab shopping”?

A: Lab shopping is when a cannabis business sends its products to multiple testing laboratories and then uses only the results from the lab that gives them the most favorable data, such as a higher THC percentage, to market their product.

Q: Why is the sale of hemp-derived products a problem for the CRA?

A: The CRA is concerned because these products, which can have high THC content, are being sold in unregulated environments without the strict testing, labeling, and age-verification rules that apply to licensed cannabis products. This poses a health and safety risk to consumers and creates unfair competition for licensed businesses.

Q: What is the proposed solution to address the issues with testing labs?

A: The CRA is pushing for a bill (House Bill 4501) that would give them the authority to open and operate a Cannabis Reference Lab. This lab would be used to conduct their own independent tests and research to verify the accuracy of results from private licensed labs.

For more information, you can read the CRA’s testimony to the state legislature on the Michigan House of Representatives website and a detailed article on the topic from Michigan Public.

For more information, you can find the detailed sales report on the Michigan Cannabis Regulatory Agency website and a breakdown of the market trends on the New Cannabis Ventures site. The foundation of the state’s cannabis market is the Michigan Regulation and Taxation of Marihuana Act (MCL 333.27951 et seq.), which governs the entire adult-use industry.

Komorn Law, established in 1993, has the experience and expertise to fight your case in a court of law from the district to federal court systems. So, when you’re ready to hire a lawyer who hates to lose, call the office at (248) 357-2550.

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