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Rescheduling vs Descheduling

Tune into hear what a rescheduling could look like for the cannabis industry, and why some industry professionals would rather see cannabis descheduled altgether and removed from the controlled substances act.

The Great Cannabis Debate And Why It Matters

Written by Casper Leitch

I was recently asked: What are the top 3 reasons blocking cannabis from being descheduled?

To be honest, I had to ponder that question for a little while. I've been active in the struggle to end cannabis prohibition since 1989 when Jack Herer hired me to run his office and to focus on making his organization, Help End Marijuana Prohibition (HEMP), grow and become an effective tool in educating the world about this amazing plant and all the things that can be produced from it.

Ending federal cannabis prohibition isn’t just about waving a magic wand. There are three main reasons why cannabis hasn’t been descheduled (removed from the Controlled Substances Act entirely).

Blocking cannabis descheduling often stems from concerns related to public health, law enforcement, and social implications. Here are what I believe are the three top reasons.

Public Health Concerns

Critics argue that cannabis has a high potential for abuse, especially with the rise of unregulated products like Delta-8 THC, which have led to increases in poison control calls. Many worry that descheduling cannabis could lead to a spike in underage use and related health issues.

Law Enforcement Challenges

Opponents believe descheduling could complicate law enforcement’s ability to regulate cannabis production and prevent black-market activity. They argue that keeping cannabis as a controlled substance helps maintain order in its distribution.

Lack of Comprehensive Research

Despite growing evidence of the medical benefits of cannabis, critics say we still don’t know enough about its long-term effects. Federal restrictions have historically made it nearly impossible to study cannabis thoroughly, leaving skeptics hesitant to change the laws.

Rescheduling vs. Descheduling: What’s the Difference?

Currently, cannabis is a Schedule I drug - the strictest classification - meaning it’s considered to have no medical use and a high potential for abuse. This puts it in the same category as heroin. The Department of Health and Human Services (HHS) recently recommended moving cannabis to Schedule III, which would acknowledge its medical value and lower its regulatory burden. However, this is not the same as full legalization.

Rescheduling to Schedule III would mean:

Cannabis could be prescribed by doctors nationwide, much like ketamine or testosterone.

Businesses would gain access to banking services and tax deductions that are currently denied under federal law.

More opportunities for scientific research.

Descheduling, on the other hand, would:

Completely remove cannabis from the Controlled Substances Act, making it federally legal.

Allow states to regulate cannabis much like alcohol.

Enable interstate commerce and create uniform regulations across the United States.

For many advocates, descheduling is the ultimate goal because it treats cannabis as a normal commodity, not a controlled substance.

The timeline of HHS’s recommendation, and the DEA’s current review.

In late 2022, President Joe Biden issued an executive order directing HHS to review marijuana’s status as a Schedule I drug under the Controlled Substances Act, while giving a recommendation on whether it should be rescheduled. After a roughly year-long review, HHS sent a letter to the DEA in August requesting that they move marijuana to Schedule III.

On September 13, 2023 - a report released by the Congressional Research Service (CRS) stated that was likely the DEA would reschedule marijuana to reschedule III, giving broad implications for federal policy.

On October 27, 2023 - a bipartisan group of 31 congress-members sent a letter to the DEA urging them to consider fully descheduling marijuana, rather than simply reschedule. Descheduling marijuana would decriminalize the plant nationwide.

On November 17, 2023 - Senator Gillibrand sent a letter to the DEA requesting marijuana be rescheduled, while also declaring that she believes marijuana should be fully descheduled. Senator Gillibrand was Chair of the Subcommittee on Livestock, Marketing and Agriculture Security as well as Chair of the Subcommittee on Emerging Threats and Capabilities.

In early December 2023 - HHS released an over 250 page document explaining their rationale for wanting the DEA to reschedule marijuana, with some of the information redacted. The following month the department released the fully unredacted document.

Over 150 of HHS’s 250 page report were spent discussing marijuana’s potential medical value. The department argued that since marijuana does have known medical value, it should not be classified as a Schedule I drug.

On December 19, 2023 - the DEA sent a letter to congressional lawmakers confirming that their review of marijuana as a Schedule I drug is currently underway, while noting that the agency has the final authority when it comes to any rescheduling effort.

On January 12, 2024 - Colorado Attorney General Phil Weiser led a group of 12 state attorney generals on a letter encouraging the DEA to reschedule cannabis in the interest of public health and safety.

On January 15, 2024 - the secretary of HHS confirmed, for the first time, that their agency has recommended to the DEA that marijuana be rescheduled to Schedule III, while confirming they are in continuing talks on the issue.

On January 29, 2024 - US Senator Kirsten Gillibrand and Congress-member Jerrold Nadler joined numerous New York lawmakers and marijuana reform activists to call on the Attorney General and the Drug Enforcement Administration (DEA) to deschedule marijuana.

On February 8, 2024 - Congress-member Earl Bluemauer (D-OR), co-chair of the Congressional Cannabis Caucus, sent a letter to DEA Administrator Anne Milgram requesting answers to several poignant questions regarding the agency’s review of marijuana as a Schedule I drug.

On February 19, 2024 - a report released by the FDA stated that when they were conducting their review of marijuana as a schedule I drug, the agency not only examined a plethora of scientific research, they had a team of researchers who spent months analyzing thousands of posts on various social media platforms, many of which were marijuana consumers putting forth anecdotal evidence of its therapeutic and medical benefits.

On February 26, 2024 - Congresswoman Sydney Kamlager-Dove (CA-37) sent a letter to the Drug Enforcement Administration (DEA) urging them to reject any argument in support of maintaining marijuana in Schedule I or Schedule II based on U.S. Treaty obligations.

On March 7, 2024 - President Biden became the first president in US history to promote marijuana law reform during a State of the Union Address. In the address, Biden stated; “I’m directing my Cabinet to review the federal classification of marijuana, and expunging thousands of convictions for mere possession, because no one should be jailed for using or possessing marijuana.”

On March 15, 2024 - Vice President Kamala Harris said the federal government should reschedule marijuana “as quickly as possible”.

On March 27, 2024 - a group of Republican senators, led by Senator Mitt Romney, urged the DEA to reject requests to reschedule marijuana.

Also in March, an official with the DEA said that when it comes to marijuana’s scheduling status, the agency is “in the process” of writing a recommendation, clarifying that Administrator Anne Milgram “will make a decision on where to place it – whether to change it or whether to remove it”.

On April 11, 2024 - during a committee hearing in the United States House of Representatives, Food and Drug Administration (FDA) Commissioner Robert Califf said “there’s no reason for the DEA to delay” a decision regarding marijuana’s scheduling status.

On April 15, 2024 - White House Press Secretary Karine Jean-Pierre said the Department of Health and Human Services’ (HHS) recommendation to the DEA to reschedule marijuana was “guided by the evidence”, while clarifying that the Justice Department now has the final say on the matter.

On April 25, 2024 - a bicameral coalition of lawmakers sent a letter to the Drug Enforcement Administration (DEA) urging them to “promptly remove marijuana from Schedule I”.

On January 15, 2025 - a Drug Enforcement Administration judge cancelled a hearing to consider the Biden administration’s proposal to reclassify marijuana under federal drug laws amid allegations that officials at the agency have conferred with witnesses opposed to the plan. Administrative Law Judge John Mulrooney canceled the hearing that was set for January 21, extending the process to ease restrictions on cannabis for at least three months.

The DEA hearing was scheduled to evaluate a proposal from the Department of Health and Human Services to change the classification of marijuana under the Community Supported Agriculture from Schedule I, the strictest category, to Schedule III. Such a move would be significant for the state-legal cannabis industry, which would no longer be denied standard business tax deductions and gain access to banking services.

Mulrooney ruled on a motion from cannabis policy reform advocates who were scheduled to testify as witnesses at the now-canceled hearing. In the motion, the witnesses alleged that the DEA had made improper communications with groups opposed to proposed rule change to reschedule cannabis and that DEA Administrator Anne Milgram had improperly selected witnesses for the hearing. Although he denied a request to remove the agency from the proceedings, Mulrooney granted a request for leave to file an interlocutory appeal, canceling next week’s hearing and staying the process for at least three months.

In his ruling, Mulrooney noted a “disturbing and embarrassing revelation” about claims of communications between DEA officials and groups opposed to marijuana policy reform. However, he said that even if the allegations are true, they do not amount to an “irrevocable taint” that would affect the outcome of the rescheduling process. As a result, the administrative law judge ruled that he did not have the authority to remove the DEA from the hearings as a proponent of the proposed rule change.

“I can no more remove or re-designate the Administrator than I can hold parties in contempt and fine them,” Mulrooney said. “The strangeness of this unsupported approach is amplified by the fact that the appointment of a new DEA Administrator by a different political party is imminent.”

Mulrooney also criticized the DEA for its actions, writing that “the specter of officials at the highest level of Agency management selectively assisting and granting access to individuals and groups standing in opposition to the Notice of Proposed Rule-making (NPRM) it purportedly supports as the proponent, carries no small measure of discomfiture,” he said. “If true, viewed in the best light, these allegations demonstrate a puzzling and grotesque lack of understanding and poor judgment from high-level officials at a major federal agency with a wealth of prior experience with the Administrative Procedures Act.”

Mulrooney ordered the DEA or the movants to submit an update on the interlocutory appeal in 90 days. He also ordered more updates on the appeal process be submitted every 90 days until the appeal is settled.

Prior to cancelling the hearing, Mulrooney admonished the DEA for its “unprecedented and astonishing” failure to follow his instructions on submitting evidence for the proceedings. On several occasions, he had informed both the agency and potential witnesses that they should submit hard copies of all evidence they wanted considered in the hearing. He also rejected a DEA request for an exception to the rule.

Despite the judge’s directions, the DEA moved to submit thousands of public comments on the proposal to reschedule marijuana digitally via compact discs. Mulrooney rejected the motion in a ruling, citing his “clear and repeated directives.”

Mulrooney further stated; “The Government has not supplied the tribunal with a hard copy of the lengthy proposed exhibit which it represents as containing the Comments. In view of the fact that Government’s request for leave for an exception to the rules applicable to the rest of the Designated Participants was specifically denied, this action is clearly not a mistake borne of misunderstanding or inadvertence, but an action taken in deliberate defiance of specific direction. Even among the numerous extraordinary and puzzling actions taken thus far by the Government during the course of this litigation, this disobedience of an unequivocal directive from the tribunal is unprecedented and astonishing.”

The Legal Distinctions Between Descheduling and Rescheduling

The consequences between descheduling marijuana and rescheduling are enormous, both legally and practically. The rescheduling process is an inter-agency governmental process that normally takes years and is rife with all of the bureaucracy and inter-agency infighting and inter-agency turf battles often associated with the federal government.

In the case of rescheduling a controlled substance under the Controlled Substances Act, HHS was tasked with overseeing a medical and scientific analysis of marijuana. The department coordinated this review with the U.S. Food and Drug Administration (FDA), which considered eight factors before making a control status recommendation.

Rescheduling cannabis would bring significant changes to industries, patients, and the economy.

Medical Cannabis Accessibility: Patients who rely on cannabis for pain management or chronic illnesses could access it more easily and affordably. Federal recognition of its medical benefits would reduce stigma and encourage broader acceptance.

Tax Relief for Cannabis Businesses: Current federal law (Section 280E) denies cannabis businesses tax deductions, resulting in effective tax rates of over 60%. Rescheduling would allow these businesses to operate like any other, fostering industry growth.

Banking and Investment Opportunities: Rescheduling could open the doors for cannabis companies to access traditional banking and attract investors, strengthening the legal market and reducing reliance on cash transactions.

More Research: Rescheduling would lower barriers for scientific research, enabling studies on cannabis’ medical benefits and long-term effects. This could pave the way for new treatments and better public health guidelines.

While rescheduling has its benefits, it’s not without challenges.

FDA Oversight: Stricter federal regulations could make it harder for smaller cannabis businesses to compete, potentially giving Big Pharma a dominant role in the industry.

State Law Conflicts: Many state-level cannabis programs don’t align with the stricter rules of Schedule III, leading to legal gray areas.

Limited Adult-Use Legalization: Rescheduling would primarily benefit medical cannabis users, leaving adult-use cannabis in legal limbo.

The Global Impacts Of Descheduling

Descheduling cannabis would have far-reaching implications beyond U.S. borders. Countries like Canada and Uruguay have already federally legalized cannabis without facing sanctions under international drug treaties. If the U.S. fully descheduled, it could set a global precedent, encouraging other nations to rethink their own cannabis policies.

Additionally, descheduling would:

Align federal and state laws, creating a cohesive regulatory framework.

Allow for the development of a robust interstate cannabis market.

Reduce criminal justice disparities caused by cannabis prohibition.

The Practical Distinctions Between Descheduling and Rescheduling

Most current marijuana operators would strongly prefer that cannabis be descheduled as opposed to rescheduled. If cannabis was descheduled, those operators likely would be allowed to operate largely as they currently operate and in a scheme resembling that of alcohol regulation. The rules would be primarily a function of existing state laws, and presumably interstate commerce in marijuana would be legal for the first time in half a century. Also, the federal oversight that would likely exist in a new descheduled cannabis industry could bring a welcomed dose of uniformity and certainty across the country for things like advertising limits, labeling, testing requirements, and how food-related products are regulated.

The Impact On Big Pharma

As noted above, if cannabis is rescheduled such that it remains a controlled substance, cannabis companies may have to comply with much more stringent FDA rules, and physicians may still face the question of whether they are permitted to prescribe medical cannabis or certify patients as being eligible to use cannabis in a medical program. Given the cost of FDA compliance and the attendant costs for research, development, and testing, existing marijuana operators may find themselves priced out of the market. If marijuana was listed as a Schedule III substance, it may be that cannabis will be brought to consumers courtesy of Big Pharma.

Big Pharma’s influence over the cannabis industry, depending on who you ask, would have its pros and cons. On the upside, large pharmaceutical companies have the resources to conduct sophisticated clinical trials and develop products that are required to be safe and effective for consumers. On the other hand – and this is the bad news for existing cannabis operators – placing the cannabis industry in the hands of pharmaceutical companies runs counter to how the industry developed and would pose a serious threat to the survival of many existing marijuana operators.

The Relationship Of Cannabis To Alcohol

Big Pharma won’t be the only major player in a descheduled or rescheduled cannabis industry. Recently, the Wine & Spirits Wholesalers of America (WSWA) released a public statement proclaiming that “the time has come for Congress to comprehensively legalize and regulate adult-use cannabis at the federal level.” In its memo, the WSWA makes the case for federal legalization and regulation by discussing what it dubs as the “Four Principles of Safe and Responsible Adult-use Cannabis Regulation.” Those four principles are:

1. The permitting of marijuana producers, importers, testing facilities, and distributors;

2. The approval and regulation of marijuana products;

3. The efficient and effective collection of federal excise tax; and

4. Effective measures to ensure public safety.

While the WSWA’s paper references a “shared state-federal regulatory structure,” its proposed model places much more of the regulatory oversight of a federally legal marijuana industry in the hands of the federal government over individual states.

Will The FDA Ever Relax Their Control On Cannabis

Others have expressed concern that a relaxation of marijuana’s controlled status could actually inadvertently upend the cannabis industry by potentially incentivizing and emboldening FDA to assume a more hands-on role with respect to marijuana, despite its largely laissez faire approach to hemp products.

If, for example, FDA is required to begin exercising the type of oversight over cannabis that it performs over existing manufacturers of controlled substances, marijuana operators are likely to face far closer scrutiny than they faced under any state regulation and be subject to far more significant operating costs than they already experience.

Advertising Cannabis Products

A less obvious result of rescheduling is that advertisements in newspapers, magazines and other media could also more easily travel across state lines. While not common, USPS has in the past issued warnings about marijuana mailings, noting in a 2015 letter to Congress that the CSA prohibits placing in “any newspaper, magazine, handbill, or other publications, any written advertisement knowing that it has the purpose of seeking or offering illegally to receive, buy, or distribute a Schedule I controlled substance” as well as using U.S. mail to facilitate “the commission of any act or acts constituting a felony.” At least one newspaper subsequently pulled marijuana ads in response to a warning it received.

If marijuana were moved into Schedule III, the obstacle to mailing marijuana advertisements would disappear. (Sending actual marijuana through the mail, of course, would still be subject to tight Schedule III restrictions.)

Others have noted the impact of rescheduling on federal employees and contractors, and the distinction may prove a difference:

The use of Schedule I and Schedule II drugs by federal government workers is prohibited under a 1986 executive order from then-President Ronald Reagan that established the Federal Drug-Free Workplace program. While individual agencies have adopted their own policies regarding drug use, many are rooted in the Reagan order. Because that order defines “illegal drugs” as only those in Schedules I and II, some attorneys believe rescheduling to Schedule III could lift marijuana restrictions that currently apply to all federal workers.

Other legal experts weren’t so sure. Shane Pennington, a partner at the law firm Porter Wright Morris & Arthur, cautioned that “various agencies have their own internal policies that would not necessarily change automatically as the result of cannabis being transferred to Schedule III.”

People who work as third-party federal contractors or grantees, however, would likely not see a policy shift as the result of rescheduling. Under federal law governing public contracts, contractors may not possess or use a “controlled substance,” defined as any drug “in schedules I through V” of the CSA.

The Impact On Cannabis Research

Rescheduling would also mean sweeping changes for cannabis research, removing many of the barriers to obtaining and using cannabis for scientific investigation. A key Senate committee recently noted that the drug’s Schedule I designation means scientists face “limited access to sources” of marijuana, further hobbling research. Of course, the 2022 Marijuana and Cannabidiol Research Expansion Act has its own provisions and requirements specific to marijuana research that must be complied with – separate and apart from other federal statutes applicable to federal marijuana research.

Schedule III rules would also still stand in the way of researchers trying to study the marijuana available on licensed, adult-use retail markets in legal states.

Existing State Cannabis Laws

DEA putting marijuana into Schedule III of the federal CSA could nevertheless trigger changes in some state laws. That’s because, in some cases, state laws themselves follow the federal CSA.

Essentially, some states have triggering laws that make the state’s scheduling correspond with a schedule change automatically, and then others don’t. Thus, it requires a 50-state analysis of which states do it automatically and then making sure that’s implemented. And then for states that don’t, that legislative and administrative process usually has to happen. In other words, federal rescheduling would likely spark a cascade of changes at the state level, most related to medical marijuana.

The Political Implications of Rescheduling vs. Descheduling

Aside from the array of formal changes that rescheduling would bring about, it could also embolden lawmakers at the state and federal levels to push for further cannabis reforms. With the federal government formally acknowledging that marijuana has medical benefits and is no longer among the class of the most dangerous drugs, the move could lessen stigma toward cannabis use, especially for medical purposes.

The HHS rescheduling memo is momentous largely because, as Hauser pointed out, it represents the U.S. government recognizing that marijuana, contrary to the definition of a Schedule I substance, has “currently accepted medical use.” Though the acknowledgment comes decades after many patients, voters and even elected officials arrived at the same conclusion, it’s nevertheless a historic milestone. But it’s also worth keeping in perspective: The HHS recommendation on its face says essentially that marijuana ought to be classified alongside substances like ketamine and testosterone.

Cannabis Stocks Are Growing Like A Weed

Perhaps to the surprise of no one, cannabis stocks skyrocketed on the news of the potential rescheduling. These stocks, which have suffered vast declines of between 30% to 80% in the past few years, are slowly climbing higher on the expectation that DEA will follow the lead of HHS. The influx of money into cannabis companies offers huge potential for growth in the industry.

Whether you’re passionate about sustainability, social justice, or public health, the fight to end cannabis prohibition impacts us all. Industrial hemp could revolutionize industries like textiles, construction, and energy, while medical cannabis offers life-changing relief to millions of patients. Legalizing recreational cannabis would generate billions in tax revenue and create thousands of jobs.

So, what’s holding us back? Outdated laws, stigma, and misinformation. By sharing knowledge and advocating for change, we can push the conversation forward and build a future where cannabis is treated as the powerful, versatile resource it truly is.

Cannabis legalization isn’t just about lighting up; it’s about lighting the way to a healthier, more equitable, and sustainable future. Share this article, talk to your friends, and stay informed. Together, we can end prohibition and unlock the full potential of this incredible plant.

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The legal status of cannabis has been a controversial issue ever since the Controlled Substances Act of 1970 (CSA) prohibited its distribution under federal law. That act classified cannabis as a Schedule I drug, a category for drugs that have no legitimate medical use and cannot be used safely even under medical supervision.

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