Week In Review: DEA Reschedules Cannabis At Last; Schumer Reintroduces CAOA; Georgia Governor Enacts New Hemp Law; Minnesota Updates Cannabis Laws

LOS ANGELES–Welcome to the far too-exciting world of cannabis and psychedelics, where it’s a tale of two markets with some states doing amazingly well. And some, well…they’re not doing so well (hello New York). Let’s get to it!

Cannabis Industry Highlights

#1. The cannabis industry was thrown into pandemonium with the sudden news the DEA moves to reclassify cannabis to Schedule III: The U.S. Drug Enforcement Administration (DEA) announced they are planning to reclassify cannabis from a Schedule I to a Schedule III substance under the Controlled Substances Act, a change first reported by the Associated Press. This change would significantly alter the regulatory framework affecting the cannabis industry. See our reporting on this topic.

#2. Public Safety and Inclusivity Drive Support for Cannabis Banking Legislation: A recent poll by Morning Consult indicates that 64% of Americans support allowing cannabis businesses access to traditional banking services, suggesting such measures could enhance public safety. The poll aligns with growing legislative momentum behind the Secure and Fair Enforcement (SAFER) Banking Act, which aims to integrate legal cannabis businesses into the mainstream financial system. Senator Chuck Schumer reintroduced the CAOA to help fix the damage caused by past drug laws, especially to communities of color and low-income areas. Stop discrimination in federal benefits based on weed use is called out in the law too.

#3. Georgia Governor Enacts New Hemp Cultivation and Regulation Law:  Georgia Governor Brian Kemp has signed into law a legislative package aimed at supporting the state’s agricultural sector, which includes new regulations for the hemp industry. The laws introduce a comprehensive framework for the licensing, cultivation, manufacturing, and retail of hemp products in Georgia.

#4. Minnesota Senate Advances Cannabis Legislation: The Minnesota Senate has passed a measure aimed at advancing the regulation of cannabis, with a narrow vote of 34 to 32, following its approval in the House last month by a 69 to 62 vote. State Representative Zack Stephenson (D) introduced the bill, which now requires a conference committee to address amendments made by the Senate and reconcile differences between the two legislative bodies.Much of the bill originated from Office of Cannabis Management recommendations on fine-tuning the legal and inter-governmental relationships among medicinal cannabis (legalized in 2014), hemp-derived THC edibles and other products (legalized in 2022), adult recreational cannabis (legalized in 2023) and the different regulatory structures governing each substance.

Psychedelic Sector Update

#1 Alaska House Advances Legislation to Prepare for Psychedelic-Assisted Therapy: The Alaska House of Representatives has passed legislation aimed at preparing the state for the potential federal approval of psychedelic-assisted therapies. The measure, known as House Bill 228 (HB 228), was approved with significant support, passing with a vote of 36 to 4.

#2. California Advances Bill for Regulated Therapeutic Use of Psychedelics: California is making strides in pioneering psychedelic-assisted therapy through proposed legislation aimed at establishing regulated centers for adult usage of substances like psilocybin, MDMA, and mescaline. The “Regulated Therapeutic Access to Psychedelics Act,” which has recently passed through Senate committees, is now pending review by the Appropriations Committee.

Sector-Wide Developments

– Canopy Growth’s Retail Optimization: The closure of five Canopy Growth retail locations is a strategic decision aimed at enhancing operational efficiency. This move reflects the company’s efforts to streamline operations and focus on profitable growth areas, amidst the challenges of a competitive market.

– Aurora Cannabis Enters the U.S.: Aurora’s strategic acquisition to enter the U.S. market represents a significant milestone. By taking a majority stake in a leading U.S.-based CBD company, Aurora is not only diversifying its portfolio but also positioning itself to capture growth in the world’s largest cannabis market.

– Washington’s Tax Relief for Medical Cannabis: The elimination of the 37% tax on medical cannabis in Washington State marks a progressive step towards supporting medical patients and designated providers. This legislative change is expected to make medical cannabis more accessible and affordable, potentially setting a precedent for other states to follow.

– Pure Jamaican’s Global Ambitions: The initiative by Pure Jamaican and Seven Ten Limited to export pharmaceutical-grade cannabinoid products underscores Jamaica’s emerging role in the global cannabis market. Targeting major markets like the USA and Brazil, this move highlights the country’s potential as a key exporter of cannabis and hemp products.

– Indiana’s Psilocybin Research Initiative: The state’s pending legislation to advance psilocybin research for mental health treatment highlights a growing recognition of the potential benefits of psychedelic substances. This initiative, particularly focused on veterans and first responders, could pave the way for broader acceptance and utilization of psilocybin in mental health care.

To have all our content delivered right to your inbox, and never miss a beat, subscribe to our newsletter at highlycapitalized.com  Stay tuned to Highly Capitalized for more updates as the cannabis and psychedelic industries continue to shape the future at the intersection of wellness and innovation. Subscribe to our newsletter and follow us on LinkedIn.