US President Joe Biden has conceded that cannabis rescheduling is not yet a done deal, and is now almost certain to take place after his term is up.
Speaking during the Congressional Black Caucus Foundation’s 2024 Pheonix Awards Dinner this week, Biden once again touted his administration’s record on cannabis reform, Marijuana Moment reported.
Biden acknowledged that the rescheduling process, which aims to move cannabis from Schedule I to Schedule III under the Controlled Substances Act, is still in progress.
However, he also noted that the process isn’t finalized, with a key hearing scheduled by the DEA in December 2024. This timeline means that the rule is unlikely to be implemented during his current term in office.
The issue of rescheduling, rarely addressed directly by the president, is now becoming an increasingly important topic in the presidential race between Kamala Harris and Donald Trump.
The former, who has historically taken a mixed but generally opposing stance to cannabis reform, has recently performed a public 180 on the issue, seeming to endorse rescheduling in a recent post on Truth Social.
However, notably, Harris has yet to address the issue directly, despite Democratic senators calling it a ‘huge one that can move votes’.
I think cannabis is a huge one that can move votes.
— Brian Schatz (@brianschatz) September 15, 2024
Investors in the cannabis industry are keeping a close eye on the upcoming DEA decision regarding the potential rescheduling of cannabis.
A key factor in this decision will be the aforementioned Administrative Law Judge (ALJ) hearing in December, where evidence and expert testimonies from both sides of the debate will be presented.
While rescheduling would be a positive step, allowing for some relief from burdensome tax regulations like the 280E provision, industry experts at a webinar hosted by Zuanic & Associates emphasized that full descheduling remains the ultimate goal to enable comprehensive cannabis reform.
However, the panel also noted that the process faces procedural hurdles and potential delays from legal challenges, adding uncertainty to the timeline. Despite these challenges, there is cautious optimism that the ALJ hearing could accelerate the rescheduling process, though political and judicial factors could further complicate the outcome.
Meanwhile, research conducted by ATB Capital Markets between August 29 and September 5, highlighted ongoing challenges in attracting investor capital for cannabis businesses, driven by prolonged delays in U.S. federal cannabis reforms.
According to its survey, only 31.8% of US investors are bullish on multi-state operator (MSO) cannabis companies, a notable drop from earlier this year.
Investors expressed that significant changes like uplisting to major stock exchanges and federal cannabis rescheduling could revitalize their interest. In fact, rescheduling cannabis could motivate 32% of investors to inject capital into MSOs.
Despite this with 68% of investors said they were confident that cannabis will be rescheduled by mid-2025, especially following Trump’s endorsement of the policy. Investors believe rescheduling could significantly boost MSO stocks, particularly the MSOS ETF, which could see a 191% rise from its current level.
