The Trump administration moved Thursday to reclassify cannabis under federal law, which would greatly expand scientific research into the drug’s medical use.
This change will not legalize the drug at the federal level, but it will move marijuana from its current status as a Schedule I substance to Schedule III under the US Drug Enforcement Administration’s regulatory framework.
In a statement, the Justice Department said it will immediately move FDA-approved products containing marijuana and substances controlled by the state’s medical marijuana license to Schedule III. It also announced an expedited hearing in June to consider the legal reclassification of Schedule I marijuana at the federal level.
“Together, these actions provide immediate and long-term clarity for researchers, patients, and providers alike while maintaining strong anti-trafficking laws,” the DOJ said.
Schedule I drugs, which include heroin and LSD, are considered to have acceptable medical use and high abuse potential. Schedule III drugs, such as Tylenol with codeine and testosterone, in contrast are recognized as having medical applications and are subject to fewer regulatory restrictions.
The reorganization breaks down long-standing barriers that have made it difficult for researchers to study cannabis in clinical settings.
Financial implications are also important. It would exempt cannabis companies from Section 280E of the IRS Code, allow them to deduct common expenses like rent and payroll for the first time, and open the door to previously restricted banking.
The move marks one of the most significant federal changes to marijuana policy in decades, reflecting a growing willingness in Washington to rethink how the drug is classified and studied in the US.
The move could benefit companies like Tilray, which is known for recreational cannabis products but is expanding its medical side. Tilray’s medical business has helped hundreds of thousands of patients in more than 20 countries, according to the company.
“We have a study to go to the FDA. We have a study to go to the DEA and show them what we’ve been doing,” said Tilray CEO Irwin Simon.
Simon told CNBC that he expects to hear from pharmaceutical companies interested in partnering with the US, similar to a wave of outreach to breweries following increased demand for hemp-derived beverages.
Tilray is currently partnering with Novartis in Canada.
Scientists have faced strict approval processes, limited access to supplies and strict compliance requirements when trying to test marijuana for therapeutic use, including chronic pain, PTSD and mood disorders. Those federal barriers remain in place as nearly half of states have legalized marijuana for recreational use, and many have legalized it for medical use.
“While operators will still face a different system from state to state, the improved cash flow from restructuring will support reinvestment, strengthen stability, and help build momentum for consistent standards over time,” said Wendy Bronfein, founder and chief product officer at Curio Wellness, a Maryland-based cannabis company.
The action follows an executive order issued last year that directs federal agencies to begin the reclassification process, which typically occurs over several years and involves scientific review, coordinating agencies and rulemaking processes.
“This reorganization is not the finish line — it’s the last leg of a decades-long race,” said Shawn Hauser, a partner at the cannabis law firm Vicente LLP.
In 2024, the Biden administration started that process and re-introduced to the public a 60-day comment period. After that window, the hearing of appeals to review the possible obstacles to the allocation of funds between the administrations.
The move also comes days after President Donald Trump signed an executive order to expedite research, clinical trials and “Right to Try” access to drugs like psilocybin, MDMA and ibogaine.
