Possible downgrading of marijuana to Schedule III drug carries with it significant implications

Law alert graphic with a background photo showing a person holding a marijuana leaf in a marijuana grow operation warehouse with a chart of the U.S. government's schedule of drugs as well as the logos for the U.S. Drug Enforcement Administration and the U.S. Department of Health and Human Services

If the U.S. Department of Health and Human Services’ recent recommendation to reclassify marijuana as a Schedule III drug is adopted, expect far-reaching consequences.

In October 2022, President Biden issued an executive order directing the Department of Health and Human Services (HHS) and Department of Justice (DOJ) to review the classification of marijuana. The Drug Enforcement Administration (DEA), the component of the DOJ that enforces the Controlled Substances Act (CSA), classifies drugs into five schedules based on their acceptable medical use and potential for abuse or dependency:

  • Schedule I are drugs deemed to have no currently accepted medical use and a high potential for abuse (heroin, LSD, ecstasy, marijuana)
  • Schedule II are drugs determined to have a high potential for abuse, with use potentially leading to severe psychological or physical dependence (cocaine, methamphetamine, methadone)
  • Schedule III are drugs deemed to have a moderate to low potential for physical and psychological dependence (ketamine, anabolic steroids, testosterone)
  • Schedule IV are drugs determined to have a low potential for abuse and low risk of dependence (Xanax, Valium, Ativan)
  • Schedule V are drugs deemed to have a lower potential for abuse than Schedule IV and consist of preparations containing limited quantities of certain narcotics (cough preparations with Codeine).

The Controlled Substances Act mandates that the DOJ obtain a “scientific and medical evaluation” and recommendation from HHS (specifically, the Food and Drug Administration) prior to reclassification, and its recommendation is binding on DEA as to scientific and medical matters.  In September, HHS recommended that marijuana be changed from Schedule I to Schedule III based on an FDA report not currently available to the public.  The CSA also requires a consideration of specific factors prior to reclassification, including actual or relative potential for abuse; scientific evidence of pharmacological effect; current scientific knowledge; history and current pattern of abuse; scope, duration, and significance of abuse; risk to the public health; and psychic or physiological dependence liability.

What’s next?

The Congressional Research Service issued a report on September 13 stating that “if past is prologue, it could be likely” that DEA will reclassify based on HHS’s recommendation.  However, two days earlier, a group of Republican lawmakers, led by Senators James Lankford and Pete Sessions, asked DEA to reject the HHS recommendation and keep marijuana as Schedule I, stating that the decision “should be based on proven facts and science – not popular opinion, changes in state laws, or the preferred policy of an administration.” Republican lawmakers asserted that nothing has changed since 2016 when the DEA rejected petitions to reschedule marijuana and that “the known risks of marijuana use have not been shown to be outweighed by specific benefits in well-controlled clinical trials.”

It should be noted that it’s possible that Congress could take matters into its own hands and amend the Controlled Substances Act with respect to marijuana by keeping or removing it from Schedule I, moving it to a different Schedule, or creating a new Schedule for it.

Federal law implications of reclassifying marijuana

If marijuana is ultimately reclassified as Schedule III, the implications under federal law include:

  • Manufacture, distribution, and possession of medical marijuana would be lawful under the Controlled Substances Act
  • Individuals who use medical marijuana lawfully would need prescriptions and would purchase marijuana at pharmacies
  • Individuals who use medical marijuana lawfully may be eligible to purchase and possess firearms, access public housing, obtain immigrant and non-immigrant visas, and face fewer hurdles for federal employment or military service
  • Marijuana producers and retailers could deduct costs of selling their product in federal income tax filings
  • Investigators could more readily conduct federally sponsored research on marijuana
  • FDA oversight would expand significantly, as the FDA heavily regulates the manufacture, distribution and sale of drugs

Analysts predict that the DEA decision (or action by Congress) will occur before the 2024 Presidential election.

Given the significant impacts the final decision will have on the nation, McAfee & Taft is committed to staying on top of this issue. For further updates, subscribe to our publications.