What Happens To The Marijuana Industry When Cannabis Is Deferred Next Month?

A proposed legislative and administrative reform of the federal cannabis statute in the United States would remove cannabis from Schedule I of the Controlled Substances Act. Since 1972, the proposal has been put forward several times. The category with the strictest restrictions is currently intended for medicines without recognized medical use.

A common concern has emerged in the cannabis reform community and among business participants as marijuana rescheduling has picked up steam in Congress and the DEA has announced that it will vote on a rescheduling this summer.

United States President Joe Biden has said he will pardon anyone found guilty of petty marijuana possession in federal court and that his administration is reevaluating how cannabis is classified as one of the deadliest narcotics.

Biden’s pardon is the first significant step toward decriminalizing marijuana and by far the most significant decision by his administration. Those entitled to a pardon receive a certificate proving that they have been acquitted of their crime.

Although some have hailed the measure as a long-overdue reform, the impact of marijuana’s reclassification is unclear and could lead to more regulation rather than reduction.

HOW MANY PEOPLE WILL FEEL THE EFFECTS OF THE PARTY

In federal courts, only a small minority of defendants in the US are found guilty of simple possession. The majority of traffickers are found guilty of more serious charges not covered by the pardon parameters. More than 6,500 people with previous federal convictions could be affected by the pardons, according to a senior administration official. Although none of them are currently incarcerated, deleting their records could make it easier for them to find work or housing.

Most marijuana convictions are at the state level, as each state has its own laws ranging from outright prohibition to full legalization, and these cases go untouched.

HOW COULD CANNABIS BE RECLASSIFIED

The federal Controlled Substances Act now lists marijuana as a so-called Schedule I drug, meaning its possession is almost entirely prohibited, except for some research purposes. Heroin is used as a comparison when classifying substances that are believed to have no valid medical use.

It would be possible for doctors to prescribe marijuana if it were moved to a lower division of the Controlled Substances Act schedule. Prescriptions would still be strictly regulated by the DEA, even if classified as a Schedule II drug like most opioids used to treat pain. Schedule V is the lowest tier where it would be lightly regulated, much like cough syrup with trace amounts of codeine.

Biden did not provide any information on the classification of marijuana. The Food and Drug Administration makes suggestions, but the Drug Enforcement Administration makes the final decision.

HOW THE REPLANNING AFFECTS EXISTING STATE CANNABIS LAWS

Thirty-seven states have already legalized cannabis for medical use, and 19 others allow it for recreational use.

Alex Kreit of the Salmon P. Chase College of Law at Northern Kentucky University claims that even if cannabis were postponed, state medical cannabis programs would still violate federal law.

Because only the Food and Drug Administration can approve prescription drugs, certain states currently allow physicians to recommend marijuana rather than prescribe it for specific medical reasons. Products dispensed under state laws are not authorized or regulated by the agency.

Reclassifying cannabis as a prescription drug would require that all cannabis products sold as medicinal products come under FDA control and that physicians comply with the same state laws that govern other prescriptions. Physicians can prescribe a drug for additional diseases or off-label use even if it has already received FDA approval for a medical use.

Big pharma might be the most interesting participant in this situation because they would benefit the most from a debt restructuring, but Douglas Berman, a professor at Ohio State University’s Moritz College of Law, emphasized that the industry is still very heavily regulated.

Federal law would continue to ban the sale of recreational marijuana until it was completely phased out. Since, with the exception of alcohol and tobacco, all drugs with a potential for abuse would have to fall under the Narcotics Act, Kreit considered this highly unlikely.

Federal officials have stopped enforcing cannabis prohibition laws in places where it has been legalized in recent years.

Even if cannabis were postponed, Kreit predicted that Congress would still step in to set some restrictions, as was the case with tobacco. Even if the federal ban were lifted, states could still impose marijuana bans.

HOW COULD A RESCHEDULE AFFECT THE OPERATION OF CANNABIS INDUSTRY COMPANIES

For many years, the marijuana industry has been in transition. Financial institutions have remained wary of them, despite the lack of federal regulations, for fear of violating federal bans even in areas where the substance is entirely legal. If marijuana were moved, nothing would necessarily change, according to Jim Thorburn, an attorney who advises cannabis companies.

Recreational use is still difficult as it could still be construed as illegal drug trafficking, he said. However, according to Thorburn, a regulatory framework that expands options for legal marijuana use could make it easier for people to take advantage of the financial system. Changing the drug’s schedule, Kreit said, “could provide more confidence and convenience for more banks and financial players” when interacting with the marijuana industry.

FINAL EFFECT

The decision by the President of the United States to phase out marijuana is a decision that the majority of citizens have been waiting for, as it also serves as the first step in the decriminalization of cannabis, bringing some sort of justice to those convicted of bad records for minimal of cannabis-related offences. The decision, if confirmed, could also mean more interaction with the cannabis industry by financial institutions and others who believe prior interaction would be a crime.

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