The Department of Health and Human Services has suggested that the Drug Enforcement Agency (DEA) consider moving cannabis from its status as a Schedule I drug to a Schedule III drug according to the Controlled Substances Act. This was revealed in a recently disclosed letter.
In a letter penned on August 29, Rachel Levine, the HHS Assistant Secretary for Health, reached out to DEA head Anne Milgram, advocating for the change in classification. The HHS later verified that its observations were indeed shared with the DEA. An HHS representative commented, “In alignment with scientific findings, HHS promptly acted on President Biden’s instruction, conveying its assessment on cannabis scheduling to the DEA as of August 29, 2023.”
This significant decision boosted cannabis stocks and was lauded by many. However, it also drew criticism for not going far enough to eliminate cannabis prohibition since it would still be a controlled substance, albeit with decreased limitations.
Previously, in October, President Joe Biden had sought a review by the HHS and the attorney general regarding cannabis’s classification in federal law. As of now, cannabis is in Schedule I, which the DEA identifies as a drug with no acknowledged medical benefits and a high likelihood of misuse.
On the other hand, the DEA characterizes Schedule III substances as those with a moderate-to-low risk of dependence. Such drugs, they claim, have less potential for abuse than Schedule I and II drugs, but are more addictive than Schedule IV (like Xanax) and Schedule V drugs (such as Robitussin AC). Some examples of Schedule III drugs are medicines with less than 90 mg of codeine per dose, ketamine, anabolic steroids, and testosterone.
It’s worth highlighting that even if cannabis becomes a Schedule III substance, it would still face a federal ban. However, it would present more opportunities for research. While some political leaders cheered this recommendation, others felt it fell short.
What’s Next in the Process?
Reports suggest that the DEA will now review the HHS’s recommendation. The DEA has its own set of criteria to assess whether cannabis should be reclassified, distinct from the HHS’s standards. Notably, the DEA has rejected cannabis’s fit for rescheduling on four past occasions.
NORML Deputy Director Paul Armentano commented on the unfolding situation, emphasizing the DEA’s traditional resistance to changing cannabis’s federal status. He noted that the ultimate decision rests with the DEA, so the path forward is still uncertain.
Senator Chuck Schumer commented favorably on the HHS’s decision, urging the DEA to act accordingly to alleviate the negative effects of strict marijuana regulations.
Is the New Classification Adequate?
Congressman Earl Blumenauer remarked that while the recommendation is a positive move, more comprehensive reforms are necessary. “This change is long overdue,” he added.
Various cannabis organizations hailed this step, though they pointed out it doesn’t amount to full federal decriminalization. Adam Goers, co-chair of the Coalition for Cannabis Scheduling Reform, remarked, “The Biden Administration is taking significant strides towards rectifying the failed cannabis prohibition.” He added that the ultimate goal is full cannabis legalization, and believes that this reclassification is a crucial step in that direction.
Effect on Cannabis Stocks
The announcement influenced the cannabis stock market. Data indicates that the AdvisorShares Pure US Cannabis ETF surged by 21%. Other cannabis-focused funds also experienced growth. Similarly, publicly-traded cannabis corporations reported a jump in their stock prices.
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