cannabis rescheduling

Rescheduling Cannabis: A Pandora’s Box of Uncertain Regulatory Challenges

by | Feb 15, 2024

cannabis rescheduling

Written by Kristina Etter

Kristina is a digital content creator and designer. She has a talent for creating engaging and informative content that resonates with our professional audience. Kristina’s passion for the cannabis industry stems from her belief that it has the potential to revolutionize the world in many ways, and has a personal testimony of cannabis success.

As a cannabis advocate who’s been deeply involved in the Colorado cannabis industry for more than 8 years, I’ve seen a lot of changes come and go. As the theories swirl around the internet about rescheduling cannabis, the anxiety within the industry is palpable.

I spoke with Kim Stuck from Allay Consulting about the rumor mill, conspiracy theories, confusion, and angst surrounding the unknown regulatory future of cannabis.

“The rescheduling situation is crazy because even if they reclassified cannabis to a Schedule III we don’t really know what is going to happen or how they’re going to regulate if they do,” Stuck presented.

kim stuck allay consulting rescheduling cannabis
Kim Stuck, Allay Consulting

Unprecedented Schedule III Situation

On one side of the aisle, people are applauding the movement anticipating that Schedule III will open up banking restrictions and lift the 280E tax burden.

With an optimistic outlook, Kim explained, “They could decide to leave it to the states and leave the existing licensing structure in place. You just have to be licensed with your state and it’ll run the way that a wholesale food or supplement manufacturer would operate. The FDA has jurisdiction over them, they come once or twice a year to do audits to make sure that you abide by FDA rules.”

On the other, some folks worry that rescheduling cannabis could impact the current legal market. The requirements for producing a Schedule III drug could be unattainable for many producers.

From this perspective, Kim explained that lawmakers could decide, “Okay, so we’re Schedule III now, and you have to have medical trials for each and every one of your products in order to sell them to the public.”

She continued, “If this were the case, everything would have to be pharmaceutical and that would put most operators out of business right away. They wouldn’t be able to sell their products, and they would have to go through the clinical trials required for FDA-approved pharmaceuticals, and most companies don’t have that kind of cash.”

rescheduling cannabis

Public Opinion Counts

Just last week, I read commentary on LinkedIn, stating there’s no precedent for Schedule III drugs being sold outside of the pharma industry. Lest we forget… there was no precedent for legalizing a Schedule I drug at the state level either. The cannabis industry has been blazing new trails since the 80s.

If there’s anything cannabis advocates have proved, it’s that where there’s a will there’s a way… the established legal market, and the people who take advantage of it will revolt if the industry is rolled back in any way regarding rescheduling cannabis.

Kim agreed, stating “I think it’s the consumers that are going to drive the way the FDA does things because if everything disappears, and the consumers are left with nothing, there’s going to be  public outrage.”

Rescheduling Cannabis and the Hemp Effect

Since the 2018 Farm Bill, the hemp industry has had unbridled, free-reign on producing hemp-derived, lab-synthesized intoxicants. “…which is unfathomable to me because the FDA literally has one job – to protect consumers from unsafe products, and they’ve been allowing a 3 billion, if not more, per year industry to just do whatever they want for a really long time now.”

“I think the hemp industry will likely feel federal regulation more than the cannabis industry will,” Kim continued. “The cannabis industry is already used to meeting particular regulations by state programs. Whereas increased regulation in the hemp industry will lead to a much bigger consolidation of who’s producing what.”

No one expected cannabis to remain a federally illegal substance – but those in the industry knew legalization would come with rules and regulations. I mean, you can’t legally catch a fish to feed yourself without a license, so why would we expect to be able to have unfettered access to a formerly taboo substance?

I’ve written in the past about why regulations for consumable products are important. We are never going to have a “for-profit” consumable product that doesn’t have protections in place for the consumer. History has shown that if corners can be cut, someone will cut them. Standards and regulations ensure everyone profiting from the game, is playing by the same rules.

Nothing Has Changed… Yet

But it will and that doesn’t have to mean it’s the end of the industry as we know it. Whether it means descheduling or rescheduling cannabis, or a combination of all of the above, the only thing we can be sure of is that things will change.

From her professional perspective, Kim said, “I would say 90% of my clients really want to know where they stand. They want a set of regulations.”

“We always err on the side of caution and we’re very conservative with what we tell our clients because we would rather have them go up to the line and not cross it rather than cross that line and then regret it later,” she explained.

But first, the line must be established. When there are no standards, consumers are at risk.

Cannabis consumers should expect the products they are buying to be safe for human consumption, but it needs to be done in a way that is fair to the producers and stimulates innovation, rather than stifles it.

Change is coming. The only question is when.

Que sera, sera!

Naturally, we’re all at the mercy of those who make the laws, and we can only hope that they’re getting all the information they need to make an educated, unbiased decision and that they keep the consumer in mind, too.

Expressing her exasperation with the legal limbo, Kim said, “It’s time to do it. And, if the federal government is going to follow through it they need to pull it off like a Band-Aid. We just want to know what’s going on.”

While many believe action on rescheduling cannabis won’t happen in an election year, only time will tell. In the mean time, we’ll be staying touch with Kim at Allay Consulting for her expert perspectives on regulatory changes in the industry.