While the number of states that have made marijuana “lawful” has grown, it’s still illegal under federal rules. But marijuana’s regulatory landscape may soon change.

The U.S. Department of Health and Human Services sent a letter to the Drug Enforcement Administration recommending that marijuana be reclassified as “lower-risk” and “Schedule III” on the five-schedule list of controlled substances. Right now, it’s a Schedule I drug, meaning it’s been deemed to have potential for abuse and has little or no medical value.

The Washington Post notes that its current classification puts it alongside heroin and LSD.

While both federal agencies confirmed the letter, it has not been publicly released. Bloomberg first reported the reclassification request.

CNN obtained confirmation Wednesday on the letter, written by Adm. Rachel Levine, assistant secretary for health at the Department of Health and Human Services. It was addressed to DEA Administrator Anne Milgram.

HHS Secretary Xavier Becerra posted on X, the social media platform formerly known as Twitter, that the letter was a result of a presidential directive to review marijuana for reclassification.

Drug enforcement officials told the Post that the DEA will now begin a review, which could take several months. “If DEA follows the health agency’s recommendation, marijuana would be placed in the same category as anabolic steroids and ketamine, which can be obtained with a prescription,” per the Post.

Advocates say such a reclassification could also make it easier to study marijuana, which has been difficult because federal law bans it. And cannabis companies could have tax breaks.

Critics say it would open the door to problems. In an article on medical marijuana, VeryWell Health notes some problems of marijuana raised by opponents of legalization. The list includes memory issues, cognitive problems, lung damage, risk of abuse and addiction, as well as accidents, noting that “marijuana use impairs driving skills and increases the risk for car collisions.”

The cannabis backdrop

Thirty-eight states have approved medical use of marijuana, including Utah. In 23 states, recreational use is allowed. “According to federal survey data, an estimated 36.4 million people age 12 or over used marijuana during the past month. The number of Americans diagnosed with cannabis use disorder has also risen, federal data shows,” The Washington Post reported.

Forbes noted efforts to change marijuana’s legal status were kicked off in October, when President Joe Biden told HHS and the attorney general to begin a review of how marijuana is classified under federal law.

Inside Utah’s medical marijuana program
Inside Utah’s medical marijuana program

As Forbes reported, “The president noted in a statement that marijuana’s designation shares the same schedule as heroin and LSD and has a higher schedule than fentanyl and meth. The president’s request was part of a larger reform plan that included a proclamation pardoning federal convictions for marijuana possession offenses. A reschedule of marijuana would not lead to a widespread legalization of marijuana products, according to California-based law firm McGlinchey Stafford. However, the firm notes marijuana’s move to Schedule III would result in a ‘much lower’ tax rate for cannabis businesses throughout the industry.”

Reclassifying the drug to Schedule III would amount to “the most significant federal cannabis reform in modern history,” Edward Conklin, executive director of the U.S. Cannabis Council, told Bloomberg.

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He added, “Thankfully, that era is coming to a close and is being replaced by a modern and scientific approach to regulating this plant.”

The proposed change does “nothing to align federal law” with the rules in the various states, National Cannabis Industry Association CEO Aaron Smith wrote in an email statement to Bloomberg. “The only way to fully resolve the myriad of issues stemming from the federal conflict with state law is to remove cannabis from the Controlled Substances Act and regulate the product in a manner similar to alcohol,” he said.

Stocks jump

Fox Business reported on a “pot stock rally” at word of the letter and its request.

According to Bloomberg, “Marijuana stocks, which are held more by individuals than institutional investors, jumped on the news. The MJ PurePlay 100 Index, which tracks cannabis stocks, rose 13% on Wednesday, paring its year-to-date decline to 21%. Columbia Care Inc. gained 39% and Ayr Wellness Inc. climbed 29%.”

Inside Utah’s medical marijuana program
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