Muddy Waters: Cannabis Trying to Find its Groove

Apropos for the name of the great blues musician, Muddy Waters, the various federal, state and international classifications of cannabis and cannabis-derived substances is a complex scheme in search of the right rhythm.  Cannabis and cannabis-derived substances are controlled within different schedules under the federal Controlled Substances Act (“CSA”), while some are not controlled at all.  With cannabis now legal in 36 states and territories for medical purposes, and in 15 states for adult recreational use, control of cannabis substances is all over the map.  As with Muddy Waters, cannabis scheduling is far from clear.

Two recent developments may further muddy the waters in regard to the “legality” of cannabis and cannabis-derived substances.  First, on December 2, 2020, the UN Commission on Narcotic Drugs (“CND”) voted to remove cannabis and cannabis resin from Schedule IV of the 1961 Single Convention on Narcotic Drugs.  Under the international treaty, drugs in Schedule IV are a subset of drugs classified in Schedule I.  The additional classification provides more restrictions on use and research involving such drugs.  Thus, while cannabis remains a Schedule I drug under the 1961 Convention, its removal from Schedule IV will open the door for research and potential consideration for approval for medical use by the UN CND.

Second, December 4, 2020 may prove to be an important watershed in the history of how the United States treats cannabis because, for the first time, a chamber of the U.S. Congress, the House of Representatives, voted to decriminalize cannabis by removing it from the CSA.  The Marijuana Opportunity Reinvestment and Expungement Act of 2019, (the “MORE Act”), H.R. 3884, passed 228-164, largely along party lines.  The MORE Act will assuredly not pass the Republican-dominated Senate in the unlikely event it is even introduced.

The MORE Act, if enacted, would institute a number of changes but none more monumental than removing marijuana and THC, the primary psychoactive substance in marijuana, from federal control.  With so many states having legalized cannabis for medical and recreational purposes, the MORE Act, even if not enacted by this Congress, portends what is likely on the horizon for cannabis.

The MORE Act would remove marijuana and THC not just from Schedule I of the CSA, but from the CSA altogether.  One needs a detailed, ever-changing scorecard to keep up with how cannabis and cannabis products are scheduled under the CSA, but unless and until cannabis is removed entirely from control, manufacturers, distributors, retailers, and others must be cognizant of how cannabis and cannabis-derived products are scheduled (controlled) and comply with federal (and state) control requirements.

There are five schedules (classifications) under the CSA based on each drug’s potential for abuse relative to their accepted medical uses.  Manufacturers, distributors, and others who prescribe or handle controlled substances must obtain a Drug Enforcement Administration (“DEA”) registration and a drug’s scheduling triggers specific quota, recordkeeping, reporting, and security requirements.  Schedule I drugs are the most stringently controlled while Schedule V the least.  Criteria and current cannabis scheduling follows:

Schedule I Criteria:

• High potential for abuse;
• No currently accepted medical use in treatment in the U.S.; and
• Lacks accepted safety for use under medical supervision.  21 U.S.C. § 812(b)(1).

Cannabis Substances in Schedule I:

• Marijuana and parts of the Cannabis sativa L. plant within the CSA definition “marihuana.”
  • Includes all parts of the plant whether growing or not; the seeds; the resin extracted from any part of the plant, and every compound, manufacture, salt, derivative, mixture, or preparation of the plant, its seeds or resin;
  • Excludes hemp and mature stalks, fiber from the stalks, oil or cake from the seeds, any other compound, manufacture, salt, derivative, mixture, or preparation of mature stalks (except the resin therefrom), fiber, oil, or cake or sterilized seeds incapable of germination). DEA Drug Code 7360; 21 U.S.C. §§ 802(16), 812(c)(10).
• Marijuana Extract. DEA Drug Code 7350; 21 C.F.R. § 1308.11(d)(58).
• THC not in hemp.
  • Includes natural delta-8-THC, delta-9-THC and synthetic equivalents including trace quantities in synthetic CBD. DEA Drug Code 7370; 21 U.S.C. § 812(c)(17); 21 C.F.R. § 1308.11(d)(31)(i).

Schedule II Criteria:

• High potential for abuse;
• Currently accepted medical use in treatment in the U.S. or a currently accepted medical use with severe restrictions; and
• Abuse may lead to severe psychological or physical dependence.  21 U.S.C. § 812(b)(2).

Cannabis Substances in Schedule II:

• FDA-approved synthetic dronabinol (delta-9-THC) in an oral solution (Syndros). DEA Drug Code 7365; 21 C.F.R. §1308.12(f)(2).

Schedule III Criteria:

• Potential for abuse less than drugs in Schedule I and II;
• Currently accepted medical use in treatment in the U.S.; and
• Abuse may lead to moderate or low physical dependence or high psychological dependence. 21 U.S.C. § 812(b)(3).

Cannabis Substances in Schedule III

• FDA-approved synthetic dronabinol (delta-9-THC) in an oral solution in sesame oil encapsulated in soft gelatin capsules (Marinol). Drug Code 7369; 21 C.F.R. § 1308.13(g)(1).

Schedule IV Criteria:

• Low potential for abuse relative to drugs in Schedule III;
• Currently accepted medical use in treatment in the U.S.; and
• Abuse may lead to limited physical dependence or psychological dependence relative to drugs in Schedule III. 21 U.S.C. § 812(b)(4).

Cannabis Substances in Schedule IV

None.

Schedule V Criteria:

• Low potential for abuse relative to drugs in Schedule IV;
• Currently accepted medical use in treatment in the U.S.; and
• Abuse may lead to limited physical dependence or psychological dependence relative to drugs in Schedule IV. 21 U.S.C. § 812(b)(5).

Cannabis Substances in Schedule IV

None.

Not Scheduled, Not Controlled:

• Hemp.
  • Includes the Cannabis sativa L. plant and any part of the plant, including seeds and all derivatives, extracts, cannabinoids, isomers, acids, salts, and salts of isomers, whether growing or not, with a delta-9-THC concentration of not more than 0.3% on a dry weight basis. 7 U.S.C. § 1639o(1); 21 U.S.C. § 802(16)(B), 812(c)(10); 21 C.F.R. § 1308.11 (d)(31)(ii).
• THC in hemp. 21 U.S.C. § 812(c)(17); 21 C.F.R. § 1308.11(d)(31)(ii).
• CBD and products derived from parts of the Cannabis sativa L. plant excluded from the CSA definition of “marihuana.” 21 U.S.C. § 802(16)(B).
• FDA-approved CBD-derived from cannabis with no more than 0.1% THC (Epidiolex).
  21 C.F.R. § 1308.15(f) (removed 2020).

The MORE Act’s removal of cannabis from Schedule I and the CSA would transfer cannabis and cannabis-derived substances from among the most stringently controlled substances in the same class as heroin, LSD, and peyote with strict quota, recordkeeping/reporting, and security requirements to no controls nor requirements.  It would remove DEA authority over legitimate handlers of cannabis, such as researchers and analytical laboratories.  Unless their language is clear and narrowly tailored, the MORE Act and similar statutes would raise a number of questions.  For example, the statute should clarify whether descheduling applies only to Cannabis sativa L. plant-derived material or also to synthetic material.  The Agriculture Improvement Act (“Farm Bill”) removed cannabis defined as “hemp” with a delta-9-THC concentration of not more than 0.3% on a dry weight basis, but what about delta-8-THC?

Decontrolling cannabis altogether under the CSA would end conflicts between federal law and states that have loosened cannabis restrictions.  But decontrolling cannabis at the federal level would initiate new conflicts between would-be looser federal laws and more restrictive states that have not decontrolled cannabis.  We note that the controlled substance statutes of a number of states automatically follow the federal lead on scheduling, rescheduling, and descheduling so unless those states take other action, they would also decontrol cannabis.

Many pro-cannabis advocates are justifiably frustrated with DEA’s snail pace on its addressing cannabis issues.  The agency has yet to move on issuing registrations to manufacture cannabis for research to any of the 37 applicants, some of whom submitted applications and began investing in operations and secure facilities over four years ago.

So, if you manufacture, distribute, sell, or otherwise handle cannabis and cannabis products, you must understand how they are scheduled and controlled, and comply accordingly.  Lawmakers and regulators have the opportunity assess and address how the U.S. moves forward with handling cannabis.  In decontrolling or rescheduling cannabis, draft the legislation or regulations clearly to say exactly what you intend them to achieve.  Unlike Muddy Waters, cannabis scheduling and control should be clear, relative to its abuse potential and legitimate medical and scientific uses.