DEA Judge Stalls Cannabis Rescheduling Over Process Gaps Report

WASHINGTON – Federal adult-use Cannabis rescheduling is at a standstill. Again. This time, the trigger is a government audit that found the Drug Enforcement Administration (DEA) and the Food and Drug Administration (FDA) have long conducted scheduling evaluations without comprehensive written procedures in place.

On September 29, DEA Chief Administrative Law Judge Derek C. Julius stayed the adult-use Cannabis rescheduling proceeding (DEA Docket No. 1362; Hearing Docket No. 26-96), halting his anticipated recommended decision before it was issued. The pause came after three anti-rescheduling hearing participants [DUID Victim Voices, Dr. Kenneth Finn, and the National Drug and Alcohol Screening Association] asked him to add a September 23 Government Accountability Office (GAO) report on drug-scheduling procedures to the record and allow extra briefing.

The GAO report, titled Drug Scheduling: While DEA Decisions Have Aligned with Recent HHS Recommendations, Both Need Comprehensive Policies, analyzed 208 DEA scheduling actions between 2020 and 2025. It found that the DEA lacks policies identifying staff roles, responsibilities and procedures for drug scheduling, and the FDA lacks written procedures specifying how staff should conduct evaluations or develop scheduling recommendations.

A critical distinction separates the audit’s findings from the merits of the Cannabis debate. The report reaches no conclusion. It mentions adult-use Cannabis and the current rescheduling effort, but it:

• conducts no Cannabis-specific eight-factor analysis,
• makes no finding on accepted medical use, and
• recommends nothing about where the plant belongs.

The documentation gaps the watchdog identified cut across every substance both agencies handle, not Cannabis in isolation. The Department of Justice, DEA, HHS, FDA and the National Institutes of Health have all agreed with the recommendations.

The three requesting parties want the GAO findings entered into the official hearing record, alongside an additional briefing period to address how they might bear on the case. [The DEA must respond by October 13, 2026, addressing the question of reopening the record. The stay delays the judge’s recommended decision, and the order sets no final deadline for when that recommendation will follow.

One piece of context that frames the entire proceeding. The DEA admitted only outside participants opposed to rescheduling into the hearing. No pro-rescheduling outside party was admitted as a designated participant, which means none is among the parties the judge asked to weigh in. The government is the only party [!] in the hearing arguing the other way, defending the proposed rule to move adult-use Cannabis to Schedule III.

The stay does not disturb a separate development. It does not affect the April 2026 order covering FDA-approved Cannabis products and medical Cannabis subject to a state license, which already placed those products in Schedule III. That reclassification stays intact.

Markets reacted. The AdvisorShares Pure US Cannabis ETF (MSOS) fell as much as roughly 8% after hours Tuesday following news of the stay.

For the broader industry, the question remains one of timing, not direction. The GAO report does not chip away at the scientific record assembled by HHS and the DEA in support of Schedule III, and the government continues to defend that position in the proceeding. What the stay accomplishes is to extend an already protracted federal process that has unfolded across two administrations. Until the DEA files its October 13 response and Judge Julius rules on the motion to reopen the record, the industry sits in a familiar position – waiting for Washington’s administrative machinery to settle a debate its own scientists largely resolved years ago.

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