Insights from Michael Werner on the DEA’s Move to Reclassify Cannabis


This landmark decision could mark the most significant federal drug policy shift since the Controlled Substances Act of 1970.

Michael Werner, head of the Healthcare & Life Sciences Practice at Holland & Knight, shares his expert insights on the recent announcement by the DEA regarding the potential reclassification of cannabis.

Historical Context and Implications

Ross O’Brien: Michael, thank you for weighing in on this historic announcement and taking us through a deeper understanding of what this means. Can you share your initial thoughts on the DEA’s groundbreaking announcement to support reclassifying cannabis?

Michael Werner: It’s important to remember that we don’t yet know the details behind the DEA announcement. Nonetheless, rescheduling cannabis is a significant development for so many reasons. For starters, it allows researchers greater access to cannabis as it will no longer be a Schedule 1 drug and subject to all the restrictions to accessing those products. Second, it will make it easier for businesses to use the US banking system. Under current law, that is prohibited; that’s why Congress has been trying to enact the SAFE Banking Act. With this change, that issue could be greatly simplified.

Clarification on Terminology: Marijuana vs. Cannabis

RO: The HHS recommendation was for the rescheduling of “Marijuana” as the specific terminology used by these federal agencies. Why is the distinction between ‘Marijuana’ and ‘Cannabis’ significant in this context?

MW: “Cannabis” refers to all products derived from the plant Cannabis sativa. The cannabis plant contains about 540 chemical substances. Marijuana refers to parts of or products from the plant Cannabis sativa that contain substantial amounts of tetrahydrocannabinol (THC). We await details from DEA on how they will address this distinction.

Understanding the Rescheduling Process and Timeline

RO: Can you walk us through the process that follows this announcement, specifically the role of the Attorney General in shaping the details of this policy change? What kind of timeline should we anticipate for these developments, and are there other critical milestones ahead?

MW: Sure. First, the Justice Department (through the DEA) submits its proposed rule to the Office of Management and Budget (OMB). OMB is part of the White House that reviews all proposed (and final) regulations. Once OMB approves – this process usually takes at least 30 days although may be expedited here – it gets published in the Federal Register. Note I anticipate it will be a proposed regulation. That means there’s a period of time – usually 60 days – within which any public stakeholder can submit comments. I would expect thousands, if not tens of thousands go stakeholders to do so. The DEA will be required by law to review all comments and then it will publish the final regulation. By law, a federal agency must review and respond to all comments so the process of review, analysis and drafting a final regulation could take a few months. In addition, Congress will have the opportunity to weigh in either through hearings, legislation or by Members of Congress submitting comments as other stakeholders will be doing. This, too, may slow down the regulatory process. Thus, the time from the announcement this week to an actual new re-scheduling regulation is likely to take several months.

State Regulations vs. Federal Policy

RO: With numerous states already having established their own medical and recreational cannabis regulations, how will this federal shift affect them? Will states need to adapt their legislation in response?

MW: This is one of the most interesting implications of a federal re-scheduling rule. Again, we need to see what DEA proposes before we can say with more certainty. However, it could raise any number of interesting questions about the supremacy of federal law. For example, if marijuana becomes a Schedule 3 drug it would be available with a prescription. However, Schedule 3 drugs are only available if the manufacturer demonstrates safety and effectiveness in clinical trials. And, the drug is only available at a licensed pharmacy. That leaves an open question about the availability of marijuana products under state law that haven’t gone through the process and sold at dispensaries that do not have pharmacy licenses.

Impact on Prescription Requirements and Recreational Businesses

RO: Shifting cannabis to a Schedule III classification implies potential prescription requirements. How do you envision this affecting the operational models of current dispensaries? Is it plausible that they may need to transition into registered pharmacies?

MW: See my answer above. And note, that a Schedule 3 drug is not available for recreational purposes. It’s a prescription drug only. In addition, the DEA proposal may opine about the Agency’s treatment of marijuana for recreational purposes.

Research Opportunities and Funding

RO: Lastly, does moving cannabis to Schedule III ease the process of obtaining research licenses? Do you foresee an increase in research funding, particularly from federal agencies like the NIH, due to this change?

MW: Yes I do. Re-scheduling the drug is likely to make the drug more available for current researchers and new researchers.

Michael Werner is the head of the Healthcare & Life Sciences Practice at Holland & Knight. He has been on the forefront of emerging markets in pharmaceuticals, biotech and dietary supplements and the intersection of policy and regulatory agencies such as the FDA & DEA.

By Ross O’Brien

Founder & Managing Partner, BVE

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