The Secretary of the U.S. Department of Health and Services has suggested we may know by the end of this year whether cannabis will be rescheduled or descheduled from the Controlled Substances Act, which may be the key to a new revived “green rush” of capital into the financially-challenged cannabis industry.
A Schedule 1 drug is defined as a drug, substance, or chemical with no currently accepted medical use and a high potential for abuse. Despite most of the 50 states legalizing cannabis and cannabis products for medical use, cannabis is still categorized as a Schedule 1 drug and, therefore, a drug with no currently accepted medical use under federal law. The current scheduling of cannabis makes conducting business in legal states difficult, and hinders the federal legalization of the substance. The de-scheduling of cannabis is unlikely, but even a rescheduling is expected to create massive shifts in the cannabis industry.
Professionals hope cannabis will be rescheduled as a Schedule 3, 4 or 5 substance. Schedule 2 drugs are defined as drugs with a high potential for abuse, with use potentially leading to severe psychological or physical dependence; Schedule 3 drugs are defined as drugs with a moderate to low potential for physical and psychological dependence; Schedule 4 drugs are drugs with a low potential for abuse and low risk of dependence, and Schedule 5 drugs have lower potential for abuse than Schedule 4 and consist of preparations containing limited quantities of certain narcotics.
For the official rescheduling of cannabis, the HHS must review the substance and then submit its review and recommendation to the Drug Enforcement Administration (DEA) to make the final decision. Although theoretically the DEA can ignore the HHS recommendation, the HHS’s ultimate health and safety findings are binding. Secretary Xavier Becerra of the HHS believes the prospect of finishing up the final review will “give the president an answer that is based on the science and the evidence. Stay tuned. We hope to be able to get there pretty soon—hopefully this year.” Becerra’s optimism is a good sign that the DEA will makes its decision about rescheduling cannabis before the close of 2023.
Depending on the outcome of the final say by the DEA, a rescheduling or descheduling of cannabis could be just what the cannabis industry needs to attract new waves of capital. Rescheduling also could mark the beginning not only of interstate but global commerce including US players.
