Congressional Research Service Foresees Potential DEA Endorsement Of Cannabis Rescheduling

On August 29, 2023, the U.S. Department of Health and Human Services (HHS) recommended the DEA reclassify cannabis and move it from Schedule I to Schedule III, following a review by the Food and Drug Administration (FDA), as part of a process initiated by President Joe Biden in 2022.

“When President Biden ordered something here, we thought it would take a really long amount of time. But this is a big positive moment for cannabis as an industry as a whole,” said George Archos, CEO of Verano Holdings Corp. VRNOF.

What’s New?

Congressional Research Service (CRS) report suggested the DEA may lean towards the HHS’s suggestion, given the agency’s historical alignment with the HHS recommendations.

A precedent exists: in 1999, Marinol, a synthetic cannabinoid, was moved to Schedule III based on HHS’s advice, reported Marijuana Moment.

Implications For Federal Policies & State Medical Marijuana Initiatives: About The Report

Taxes & Business: The change may lead to federal tax benefits for marijuana businesses and remove DEA production quotas, promoting business growth.

Medical Marijuana: Transition to Schedule III could legally sanction medical marijuana’s manufacture, distribution and possession, though potential FDA approval and DEA licenses could be challenges.

Regulatory Oversight: The FDA’s authority over medical marijuana may grow, necessitating increased resources for standard maintenance.

Rights & Eligibility: Medical cannabis users could have expanded rights, affecting areas from gun ownership to visa eligibility.

“Those who use medical marijuana lawfully may now be eligible to access public housing, obtain immigrant and nonimmigrant visas, and purchase and possess firearms. Those who use marijuana recreationally would still face restrictions in these areas,” stated the CRS.

State Implications

such as Colorado Gov. Jared Polis emphasized the need for clarity. State marijuana initiatives might require realignment with revised CSA guidelines, per the report.

Research & Development: A significant upside, as indicated by CRS, is the bolstering of marijuana research opportunities. Removal of DEA quotas could spur detailed studies on the plant’s properties.

Congressional Direction: While the DEA might heed the HHS recommendation, Congress has the final decision. They can maintain the current status, reclassify, delist marijuana, or explore other classifications. 

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