US plans to reclassify marijuana to Schedule III, recognising its medicinal benefits
\nIt\u2019s a move billed as the biggest shift in marijuana policy by the DEA in 50 years.
\nReclassification could lead to tax breaks for cannabis companies, potentially boosting the industry<\/p>\n
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It\u2019s been called the biggest shift in marijuana policy by the US Drug Enforcement Administration (DEA)<\/strong> in 50 years.<\/p>\n Earlier this week, a widely cited report by the Associated Press<\/em> <\/a>suggested that the DEA plans to reclassify marijuana to Schedule III<\/strong>, essentially moving it to a less dangerous category shared with drugs like ketamine and codeine.<\/p>\n According to the DEA\u2019s definition, Schedule III drugs are \u201cdrugs with a moderate to low potential for physical and psychological dependence.\u201d<\/p>\n While the DEA will still not be legalising marijuana for recreational use, the reclassification acknowledges cannabis\u2019 medicinal benefits, makes buying and selling easier, and recognises its lower abuse potential compared to drugs like heroin.<\/p>\n The plan still needs the White House\u2019s green light, but if approved, it could become a\u00a0significant catalyst for an industry hemmed in by US federal regulations, even as restrictions have begun to ease at state level.<\/p>\n \u00a0<\/p>\n Cannabis (or marijuana) in the US has been classified alongside heroin and LSD as Schedule I drugs since the 1970s \u2013 ie; substances deemed to have no medical use and a high potential for abuse.<\/p>\n This classification effectively criminalises its possession, sale, and use at the federal level.<\/p>\n While the intentions are good, this has had far-reaching consequences.<\/p>\n It hindered scientific research into cannabis\u2019 potential medical benefits, and disproportionately impacted some minorities through aggressive law enforcement and harsh sentencing policies.<\/p>\n Starting in the early 2000s, momentum for cannabis reform continued to grow, and US states began legalising them for medicinal purposes at an increasing rate.<\/p>\n Then, in 2012, Colorado and Washington became the first states to legalise recreational marijuana for adult use, followed by a wave of legalisation efforts in other states.<\/p>\n Despite these state-level reforms, marijuana remained illegal at the federal level, creating a tension between state and federal law.<\/p>\n In 2013 however, the Department of Justice issued guidance allowing states to regulate marijuana without federal interference, signalling a more hands-off approach to enforcement.<\/p>\n Momentum grew further when in 2021, the US House of Representatives passed the Marijuana Opportunity Reinvestment and Expungement (MORE) Act,<\/strong> which was meant to decriminalise marijuana at the federal level.<\/p>\n While the MORE Act still faces uncertain prospects in the Senate, the bill\u2019s passage in the House marked a significant milestone in the push for federal marijuana reform.<\/p>\n \u00a0<\/p>\n The implications of this latest development are obviously still murky, but reclassifying marijuana in general would be good for cannabis companies.<\/p>\n According to the current US Internal Revenue Code Section 280E<\/em>, companies selling marijuana can\u2019t subtract their business expenses when paying taxes. This means they end up paying much higher taxes.<\/p>\n But if marijuana gets reclassified, these companies will be able to get those tax breaks, which could propel some into profitability.<\/p>\n The rescheduling will also make it easier for biotechs to study cannabis.<\/p>\n Right now, to take cannabis into clinical trials in the US, researchers have to jump through a bunch of hoops such as signing up with the DEA (but if they were studying drugs like cocaine or fentanyl, they wouldn\u2019t need to).<\/p>\n These cannabis biotechs also need to get their research plans approved by the FDA, and meet strict rules about how they store the cannabis, which some companies find too costly and difficult to manage.<\/p>\n The rescheduling, if it happens, could remove all these barriers, paving the way for more cannabis research and development.<\/p>\n ASX-listed Little Green Pharma (ASX:LGP)<\/a><\/strong> released a statement on Thursday, sharing its thoughts on what this development would mean.<\/p>\n The company said:<\/p>\n \u201cThe rescheduling of cannabis in the US would represent the most significant change in global cannabis regulation ever and follows on the heels of Germany\u2019s recent decision to legalise cannabis last month.<\/em><\/p>\n \u201cThe news has resulted in a re-rating of North American cannabis companies with the MJ ETF (US ETF to target the global cannabis industry) and the MSOS ETF (ETF with dedicated cannabis exposure focusing exclusively on U.S. companies, including multi- state operators) \u2013 both increasing by over 25%.<\/em><\/p>\n \u201cThis sector re-rating is expected to flow through to other cannabis companies including LGP, given the historical mirroring of the North American markets.<\/em>\u201d<\/p>\n \u00a0<\/p>\n Here\u2019s how the ASX weed stocks have performed, sorted by winners over the past week<\/em><\/strong><\/p>\n Code Company Price % Week % Month % 6-Month % Year Market Cap IRX Inhalerx 0.039 39% -22% -7% -13% $6,072,543 VIT Vitura Health 0.130 24% -30% -61% -65% $74,863,592 BOT Botanix Pharma 0.243 13% 8% 73% 182% $370,157,264 EOF Ecofibre 0.068 11% -24% -53% -62% $25,763,425 ALA Arovella Therapeutic 0.120 4% -20% 36% 67% $126,018,748 LGP Little Green Pharma 0.135 4% -4% -4% -16% $39,228,879 EMD Emyria 0.052 2% -12% -28% -66% $19,064,729 ZLD Zelira Therapeutics 0.720 1% 3% -21% -23% $7,886,273 WOA Wide Open Agricultur 0.091 1% -5% -48% -72% $15,754,061 AC8 Auscann Grp Hlgs 0.040 0% 0% 0% 0% $17,621,884 BOD BOD Science 0.024 0% 0% -57% -59% $4,256,124 CAN Cann 0.062 0% 0% -46% -62% $27,123,891 EPN Epsilon Healthcare 0.024 0% 0% -17% 33% $7,208,496 EVE EVE Health 0.001 0% 0% 0% 0% $5,274,483 EXL Elixinol Wellness 0.005 0% 0% -30% -68% $7,806,444 MDC Medlab Clinical 6.600 0% 0% 0% 0% $15,071,113 ROO Roots Sustainable 0.007 0% 0% 40% 0% $1,124,217 HGV Hygrovest 0.046 0% -6% -21% -23% $9,674,288 NTI Neurotech Intl 0.090 0% -18% 73% 80% $92,582,361 AVE Avecho Biotech 0.004 0% -20% 0% -20% $11,092,540 BP8 Bph Global 0.001 0% -33% 0% -75% $1,954,116 RGT Argent Biopharma 0.395 -2% -4% -44% -95% $17,885,680 IDT IDT Australia 0.094 -3% 22% 34% 6% $33,390,550 DTZ Dotz Nano 0.130 -4% -21% -26% -43% $67,856,099 WNX Wellnex Life 0.019 -5% -32% -53% -61% $23,754,965 LV1 Live Verdure 0.705 -7% 47% 93% 370% $82,161,120 ECS ECS Botanics Holding 0.020 -9% -20% -13% -5% $27,059,541 AGH Althea 0.029 -12% -6% -33% -47% $11,754,641 ME1 Melodiol Glb Health 0.004 -13% -30% -94% -98% $2,020,462 WFL Wellfully 0.003 -25% -25% -25% -73% $1,478,832 <\/p>\n WordPress Table Plugin<\/a><\/p>\n \u00a0<\/p>\n inhaleRX (ASX:IRX)<\/a><\/strong><\/p>\n inhaleRX rose on Thursday on no specific news.<\/p>\n The company did report its quarterly update on Tuesday, reiterating that it was preparing the necessary information for a Phase 1 HREC (Human Research Ethics Committees) submission for IRX616a<\/em>.<\/p>\n IRX says it remains confident that IRX will be able to demonstrate the safety and tolerability of inhaled cannabidiol (CBD), which is already licensed for the treatment of rare pediatric-onset epilepsies and widely available as a non-prescription health supplement globally.<\/p>\n IRX616a is a drug-device product consisting of synthetic CBD delivered via inhalation in a fixed dose to treat panic disorder.<\/p>\n \u00a0<\/p>\n Vitura Health (ASX:VIT)<\/a><\/strong><\/p>\n The digital health platform company said its wholly-owned subsidiary, Canview<\/em>, was successful in restraining Code 4 Cannabis Pty Ltd (C4C), the licensor of the software used as part of the Canview platform, from acting on its service termination.<\/p>\n C4C consented to the orders by Justice Kelly in the Supreme Court of Queensland. The effect of the injunction orders is that C4C is restrained from disabling Canview\u2019s access to the software until the proceedings are determined, or until further order.<\/p>\n In January, C4C told Vitura it did not intend to extend its licensing agreement with the company beyond the existing contract\u2019s expiry in August, after Vitura raised a \u201cnumber of issues\u201d with the software developer.<\/p>\n The two companies agreed to proceed to the courts last week to resolve the matter.<\/p>\n \u00a0<\/p>\n Botanix Pharma (ASX:BOT)<\/a><\/strong><\/p>\n Botanix Pharma was included in the ASX All Ordinaries Index in April.<\/p>\n Botanix joins the ranks of the index, which comprises the 500 largest companies listed on the ASX, based on its strong performance over the last 12 months.<\/p>\n Botanix shares have risen by over +100% in the last 12 months, driven by interest in the company\u2019s treatment for excessive underarm sweating that is expected to receive approval from the US FDA in late June.<\/p>\n \u00a0<\/p>\n \u00a0<\/p>\n <\/span><\/p>\n The post Weed Week: It\u2019s showtime! Cannabis could come back from the dead as US makes biggest move in 50 years<\/a> appeared first on Stockhead<\/a>.<\/p>","protected":false},"excerpt":{"rendered":"The evolution of marijuana in the US<\/h2>\n
What now?<\/h2>\n
To ASX Weed Stocks \u2026.<\/h2>\n