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This is the seventh of 13 posts describing the impacts of marijuana’s rescheduling. An homage to Phish’s historic run at Madison Square Garden in the Summer of 2017, Budding Trends Baker’s Dozen will address how rescheduling affects various areas of the law and our daily lives. Enjoy the run.
Those of you who have been following along with our series on marijuana rescheduling know that on April 22, 2026, the DEA issued its long-awaited final order moving certain marijuana products — specifically state-licensed medical marijuana and FDA-approved marijuana products — from Schedule I to Schedule III. We’ve covered what the order means and doesn’t mean, what state-licensed medical marijuana operators need to know and do, and the tax implications. But rescheduling has me wondering — are we going to start hearing more about cannabis as medicine, and what does rescheduling mean for the future of cannabis clinical research? These aren’t just esoteric questions. I believe the answer to those questions will largely determine whether rescheduling will result in an influx of capital from pharmaceutical companies, be it cannabis-native biotech firms or established pharma players.
If you’ve spent any time in the cannabis space, you’ve heard practitioners, researchers, and patients alike lament the vicious cycle at the heart of the federal marijuana prohibition: In theory you couldn’t provide a data-backed argument for moving marijuana off Schedule I without clinical trial data, but you couldn’t easily run clinical trials because marijuana was on Schedule I. For decades, researchers trying to study marijuana faced heightened DEA registration requirements, a severely limited pool of federally authorized suppliers — historically and until recently just one facility at the University of Mississippi — and protocol approval processes that meant many academic institutions and pharmaceutical companies simply didn’t bother. The result was a gap between what patients and their doctors anecdotally reported about marijuana and what peer-reviewed science substantiated.
Moving marijuana to Schedule III doesn’t flip a switch and suddenly make marijuana research frictionless. DEA registration requirements still apply to anyone handling marijuana for research purposes, and the barriers of the Controlled Substances Act don’t disappear.
But the practical improvements are meaningful. Schedule III status brings marijuana into the same regulatory neighborhood as drugs like Ketamine or Tylenol with codeine — substances subject to controls but whose research is not treated with the same level of skepticism and bureaucratic friction that Schedule I imposes. We suspect researchers will find it easier to access study materials, face a less onerous approval process for their protocols, and encounter fewer institutional gatekeepers who reflexively say no to Schedule I research. Perhaps most importantly, we think that the formal federal acknowledgment that marijuana has “currently accepted medical use” — a finding embedded in rescheduling — likely starts to change the conversation in grant review committees and boardrooms across the country.
One particularly notable clarification buried in the April 22 order deserves attention: The order expands the sources of marijuana products from which clinical trials can now be conducted. The order states:
Out of an abundance of caution, the Administrator clarifies that researchers who obtain marijuana or marijuana-derived products from a state licensee for use in scientific research shall incur no civil or criminal liability under the Controlled Substances Act solely by reason of having obtained such products from a state-licensed source rather than a separately DEA-registered bulk manufacturer, provided that the researcher is registered with the Administration to conduct research with marijuana under 21 CFR 1301.13 and the state licensee from whom the researcher obtained the marijuana held a valid federal registration at the time of the transfer.
In other words, researchers can use marijuana or marijuana derived products from a state licensee so long as the researcher is properly registered and the licensee held a valid federal registration. Researchers are no longer being limited exclusively to federally grown marijuana. This is a significant practical change. The federally grown supply was notoriously limited and often criticized as unrepresentative of what patients actually use in state markets. Opening the supply pool to state-licensed products should meaningfully expand the feasibility and relevance of future clinical research. We also query whether this will create additional, meaningful demand for state-licensed growers and processors.
The Trump executive order that set this rescheduling in motion also directed HHS, FDA, CMS, and NIH to develop models for incorporating “real-world evidence” into regulatory decision-making for cannabis (marijuana and hemp) products. Is this a signal that the federal government is willing to look beyond the traditional randomized controlled trial framework that, ironically, marijuana’s Schedule I status had made it nearly impossible to satisfy? We’ll have to wait and see, but our curiosity is piqued.
So, does all this mean that pharmaceutical companies will dive into the marijuana industry in a way we haven’t seen before? I think probably, but carefully and selectively. To be sure, even under rescheduling, companies still have to clear the FDA’s drug approval process, including clinical trials demonstrating safety and efficacy. That’s a high bar — but it’s a bar pharmaceutical companies know how to clear. What they couldn’t easily navigate was the additional layer of Schedule I uncertainty. Remove that layer and the potential market share that would come with a successful marijuana-based product, and you’ve got something closer to a normal drug development risk profile — and a lucrative one at that.
For companies wondering whether the FDA drug pathway is actually navigable for a marijuana-derived product, the answer is already yes. It’s been demonstrated with Epidiolex, which is an FDA-approved cannabidiol medication for rare seizure disorders, including Dravet syndrome, Lennox-Gastaut syndrome, and tuberous sclerosis complex. Jazz Pharmaceuticals’ continued investment in expanding the Epidiolex label and evidence base shows that a cannabinoid-based product can support an ongoing, multi-indication research program with the same rigor as any other pharmaceutical compound.
To be sure, companies racing to rebrand themselves as pharmaceutical players face a genuine challenge worth flagging: The FDA approval pathway is extraordinarily long and expensive, and Schedule III status doesn’t compress that timeline. MMJ International Holdings’s CEO put it bluntly recently: “You cannot shortcut the FDA. Many companies are just now deciding they want to be pharmaceutical, but the real barrier to entry is time spent inside the regulatory process.”
As of this writing, no company has announced a brand-new clinical trial in the days since the April 22 order. But I do think what the next several months will likely bring is a significant increase in FDA pre-Investigational New Drug (IND) meeting requests and IND submissions for marijuana-derived investigational drugs, particularly in the therapeutic areas where existing anecdotal and observational evidence is strongest. A few areas stand out as most likely to attract serious investment in the near term:
For marijuana operators and investors, the message is nuanced. Rescheduling does not transform the existing marijuana industry into a pharmaceutical industry overnight — and companies that position themselves primarily as pharmaceutical players will need to reckon with the full weight of FDA drug approval requirements. That is a very different, and much more capital-intensive, business model than running a vertical segment of a state-licensed medical operation.
We predict we may see bifurcation: the existing state-licensed medical marijuana industry continuing to operate under its current model while navigating the new DEA registration requirements, and a separate pharmaceutical track where new entrants — some established pharma companies, some cannabis-native biotech firms — invest in the clinical development infrastructure needed to bring marijuana-based drugs through FDA approval. We suspect some companies and established players are betting they can straddle both worlds. Whether that’s right will depend heavily on their ability to make the cultural and operational shift from cannabis producers to regulated pharmaceutical developers — and the FDA will be the judge of that.
From a legal perspective, companies eyeing the clinical trial space should be thinking now about DEA research registration, FDA pre-IND meeting strategy, IP protection for novel cannabinoid formulations and delivery methods, and the interplay between any pending state-law marijuana business interests and a new pharmaceutical development track. There’s a lot to think about but also a lot of opportunity. The companies that position themselves wisely now, understanding both the opportunity and the remaining uncertainty, are the ones most likely to be able to capitalize.
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Find Your Next Job !
This is the seventh of 13 posts describing the impacts of marijuana’s rescheduling. An homage to Phish’s historic run at Madison Square Garden in the Summer of 2017, Budding Trends Baker’s Dozen will address how rescheduling affects various areas of the law and our daily lives. Enjoy the run.
Those of you who have been following along with our series on marijuana rescheduling know that on April 22, 2026, the DEA issued its long-awaited final order moving certain marijuana products — specifically state-licensed medical marijuana and FDA-approved marijuana products — from Schedule I to Schedule III. We’ve covered what the order means and doesn’t mean, what state-licensed medical marijuana operators need to know and do, and the tax implications. But rescheduling has me wondering — are we going to start hearing more about cannabis as medicine, and what does rescheduling mean for the future of cannabis clinical research? These aren’t just esoteric questions. I believe the answer to those questions will largely determine whether rescheduling will result in an influx of capital from pharmaceutical companies, be it cannabis-native biotech firms or established pharma players.
If you’ve spent any time in the cannabis space, you’ve heard practitioners, researchers, and patients alike lament the vicious cycle at the heart of the federal marijuana prohibition: In theory you couldn’t provide a data-backed argument for moving marijuana off Schedule I without clinical trial data, but you couldn’t easily run clinical trials because marijuana was on Schedule I. For decades, researchers trying to study marijuana faced heightened DEA registration requirements, a severely limited pool of federally authorized suppliers — historically and until recently just one facility at the University of Mississippi — and protocol approval processes that meant many academic institutions and pharmaceutical companies simply didn’t bother. The result was a gap between what patients and their doctors anecdotally reported about marijuana and what peer-reviewed science substantiated.
Moving marijuana to Schedule III doesn’t flip a switch and suddenly make marijuana research frictionless. DEA registration requirements still apply to anyone handling marijuana for research purposes, and the barriers of the Controlled Substances Act don’t disappear.
But the practical improvements are meaningful. Schedule III status brings marijuana into the same regulatory neighborhood as drugs like Ketamine or Tylenol with codeine — substances subject to controls but whose research is not treated with the same level of skepticism and bureaucratic friction that Schedule I imposes. We suspect researchers will find it easier to access study materials, face a less onerous approval process for their protocols, and encounter fewer institutional gatekeepers who reflexively say no to Schedule I research. Perhaps most importantly, we think that the formal federal acknowledgment that marijuana has “currently accepted medical use” — a finding embedded in rescheduling — likely starts to change the conversation in grant review committees and boardrooms across the country.
One particularly notable clarification buried in the April 22 order deserves attention: The order expands the sources of marijuana products from which clinical trials can now be conducted. The order states:
Out of an abundance of caution, the Administrator clarifies that researchers who obtain marijuana or marijuana-derived products from a state licensee for use in scientific research shall incur no civil or criminal liability under the Controlled Substances Act solely by reason of having obtained such products from a state-licensed source rather than a separately DEA-registered bulk manufacturer, provided that the researcher is registered with the Administration to conduct research with marijuana under 21 CFR 1301.13 and the state licensee from whom the researcher obtained the marijuana held a valid federal registration at the time of the transfer.
In other words, researchers can use marijuana or marijuana derived products from a state licensee so long as the researcher is properly registered and the licensee held a valid federal registration. Researchers are no longer being limited exclusively to federally grown marijuana. This is a significant practical change. The federally grown supply was notoriously limited and often criticized as unrepresentative of what patients actually use in state markets. Opening the supply pool to state-licensed products should meaningfully expand the feasibility and relevance of future clinical research. We also query whether this will create additional, meaningful demand for state-licensed growers and processors.
The Trump executive order that set this rescheduling in motion also directed HHS, FDA, CMS, and NIH to develop models for incorporating “real-world evidence” into regulatory decision-making for cannabis (marijuana and hemp) products. Is this a signal that the federal government is willing to look beyond the traditional randomized controlled trial framework that, ironically, marijuana’s Schedule I status had made it nearly impossible to satisfy? We’ll have to wait and see, but our curiosity is piqued.
So, does all this mean that pharmaceutical companies will dive into the marijuana industry in a way we haven’t seen before? I think probably, but carefully and selectively. To be sure, even under rescheduling, companies still have to clear the FDA’s drug approval process, including clinical trials demonstrating safety and efficacy. That’s a high bar — but it’s a bar pharmaceutical companies know how to clear. What they couldn’t easily navigate was the additional layer of Schedule I uncertainty. Remove that layer and the potential market share that would come with a successful marijuana-based product, and you’ve got something closer to a normal drug development risk profile — and a lucrative one at that.
For companies wondering whether the FDA drug pathway is actually navigable for a marijuana-derived product, the answer is already yes. It’s been demonstrated with Epidiolex, which is an FDA-approved cannabidiol medication for rare seizure disorders, including Dravet syndrome, Lennox-Gastaut syndrome, and tuberous sclerosis complex. Jazz Pharmaceuticals’ continued investment in expanding the Epidiolex label and evidence base shows that a cannabinoid-based product can support an ongoing, multi-indication research program with the same rigor as any other pharmaceutical compound.
To be sure, companies racing to rebrand themselves as pharmaceutical players face a genuine challenge worth flagging: The FDA approval pathway is extraordinarily long and expensive, and Schedule III status doesn’t compress that timeline. MMJ International Holdings’s CEO put it bluntly recently: “You cannot shortcut the FDA. Many companies are just now deciding they want to be pharmaceutical, but the real barrier to entry is time spent inside the regulatory process.”
As of this writing, no company has announced a brand-new clinical trial in the days since the April 22 order. But I do think what the next several months will likely bring is a significant increase in FDA pre-Investigational New Drug (IND) meeting requests and IND submissions for marijuana-derived investigational drugs, particularly in the therapeutic areas where existing anecdotal and observational evidence is strongest. A few areas stand out as most likely to attract serious investment in the near term:
For marijuana operators and investors, the message is nuanced. Rescheduling does not transform the existing marijuana industry into a pharmaceutical industry overnight — and companies that position themselves primarily as pharmaceutical players will need to reckon with the full weight of FDA drug approval requirements. That is a very different, and much more capital-intensive, business model than running a vertical segment of a state-licensed medical operation.
We predict we may see bifurcation: the existing state-licensed medical marijuana industry continuing to operate under its current model while navigating the new DEA registration requirements, and a separate pharmaceutical track where new entrants — some established pharma companies, some cannabis-native biotech firms — invest in the clinical development infrastructure needed to bring marijuana-based drugs through FDA approval. We suspect some companies and established players are betting they can straddle both worlds. Whether that’s right will depend heavily on their ability to make the cultural and operational shift from cannabis producers to regulated pharmaceutical developers — and the FDA will be the judge of that.
From a legal perspective, companies eyeing the clinical trial space should be thinking now about DEA research registration, FDA pre-IND meeting strategy, IP protection for novel cannabinoid formulations and delivery methods, and the interplay between any pending state-law marijuana business interests and a new pharmaceutical development track. There’s a lot to think about but also a lot of opportunity. The companies that position themselves wisely now, understanding both the opportunity and the remaining uncertainty, are the ones most likely to be able to capitalize.
More Upcoming Events
Sign Up for any (or all) of our 25+ Newsletters
You are responsible for reading, understanding, and agreeing to the National Law Review’s (NLR’s) and the National Law Forum LLC’s Terms of Use and Privacy Policy before using the National Law Review website. The National Law Review is a free-to-use, no-log-in database of legal and business articles. The content and links on www.NatLawReview.com are intended for general information purposes only. Any legal analysis, legislative updates, or other content and links should not be construed as legal or professional advice or a substitute for such advice. No attorney-client or confidential relationship is formed by the transmission of information between you and the National Law Review website or any of the law firms, attorneys, or other professionals or organizations who include content on the National Law Review website. If you require legal or professional advice, kindly contact an attorney or other suitable professional advisor.
Some states have laws and ethical rules regarding solicitation and advertisement practices by attorneys and/or other professionals. The National Law Review is not a law firm nor is www.NatLawReview.com intended to be a referral service for attorneys and/or other professionals. The NLR does not wish, nor does it intend, to solicit the business of anyone or to refer anyone to an attorney or other professional. NLR does not answer legal questions nor will we refer you to an attorney or other professional if you request such information from us.
Under certain state laws, the following statements may be required on this website and we have included them in order to be in full compliance with these rules. The choice of a lawyer or other professional is an important decision and should not be based solely upon advertisements. Attorney Advertising Notice: Prior results do not guarantee a similar outcome. Statement in compliance with Texas Rules of Professional Conduct. Unless otherwise noted, attorneys are not certified by the Texas Board of Legal Specialization, nor can NLR attest to the accuracy of any notation of Legal Specialization or other Professional Credentials.
The National Law Review – National Law Forum LLC 2070 Green Bay Rd., Suite 178, Highland Park, IL 60035 Telephone (708) 357-3317 or toll-free (877) 357-3317. If you would like to contact us via email please click here.
Copyright ©2026 National Law Forum, LLC