DEA rescheduling of marijuana: Initial steps taken, broader Schedule III review still pending

The United States Department of Justice (DOJ) and the Drug Enforcement Administration (DEA) recently issued a press release announcing a final order that significantly impacts the federal treatment of marijuana under the Controlled Substances Act (CSA).

The order, which went into effect immediately, placed two categories of marijuana-related products in Schedule III:

• US Food and Drug Administration (FDA)-approved drug products containing marijuana
  
  
• Medicinal marijuana products subject to a qualifying state-issued medical marijuana license (Covered Marijuana Products).

The same press release also noted that the agencies would initiate a new administrative hearing process, beginning on June 29, 2026, to determine whether marijuana’s status will be moved more broadly from Schedule I to Schedule III.

Importantly, this is not a categorical rescheduling of marijuana. The April 23 reclassification is limited in scope, and any form of marijuana outside of the two aforementioned categories remains in Schedule I unless and until the broader rulemaking is completed.

Clarifying the scope of the final order

Companies in the marijuana industry should first confirm on a product-by-product basis whether their products fall within the scope of the reclassification order. The final order expressly notes that, outside of the two categories of Covered Marijuana Products, products such as adult-use marijuana products, synthetic tetrahydrocannabinol (THC) products, and bulk/raw marijuana cultivated without a state medical marijuana license have not been reclassified. Further, the final order clarifies that it does not impact the status of hemp (which is excluded from the definition of marijuana), any drug product containing marijuana or THC that was previously rescheduled out of Schedule I (such as Marinol and Syndros), or any previously scheduled synthetic cannabinoids.

Category	Covered by Schedule III reclassification?
FDA-approved drug products containing marijuana	Yes
Products containing marijuana that are subject to a qualifying state-issued medical marijuana license	Yes
Adult-use and recreational marijuana products	No
Synthetic THC products	No
Hemp and hemp-derived products	No
Bulk/raw marijuana cultivated outside state-issued medical marijuana license	No
Any drug product containing marijuana or THC that was previously rescheduled out of Schedule I	No
Any previously scheduled synthetic cannabinoids	No

 

Next steps for applicable companies

Once applicability of the reclassification order has been confirmed, companies should undertake a broad regulatory review to align their current DEA registration, procedures, recordkeeping, labeling, security controls, and cross-border activities with the new Schedule III status for their Covered Marijuana Products. Below are some key considerations; however, applicable companies are encouraged to consult with counsel for a more comprehensive and tailored analysis of their business and products.

• DEA registration: Companies must hold a Schedule III DEA registration in order to manufacture, distribute, dispense, import, or export Covered Marijuana Products. Notably, there is a narrow transition window available under the order. A company that files its DEA registration application within the 60 days after publication in the Federal Register (June 2026) may continue operating under its state license while the DEA application is pending. The order instructs DEA to process all applications within a six-month period.
  
  
• Recordkeeping and reporting: Companies should review their current inventory, recordkeeping, and reporting systems to confirm whether they align with Schedule III obligations. For example, while the order provides that DEA will accept state-required forms, reports, and records “to the maximum extent permissible,” this is conditioned on the state-authorized medical marijuana certifications containing the user’s name and address, dated and signed on the day of issuance, and identifying the issuing practitioner.
  
  
• Packaging and labeling: Similarly, companies should review their current packaging and labeling to confirm whether they meet applicable federal requirements. The order notes that registrants may rely on state-law labeling and packaging requirements in lieu of DEA requirements, provided they comply with the statutory warning label required under 21 U.S.C. 825(c).
  
  
• Importation/exportation: The order clarifies that Covered Marijuana Products reclassified as Schedule III remain subject to certain import and export controls. Companies engaging in importation or exportation activities should confirm whether they need to comply with any DEA permits, filings, or related requirements beforehand.
  
  
• Tax treatment: Companies are encouraged to analyze their federal tax implications with tax counsel. While this is not a DEA requirement, the reclassification may affect tax treatment for qualifying state medical marijuana licensees because they are no longer subject to the deduction disallowance imposed by Section 280E of the Internal Revenue Code.

Looking ahead: Strategic questions for marijuana industry

Companies are encouraged to consider both near-term licensing and market positioning as well as long-term enterprise value and risk. Evolving marijuana regulation also raises related considerations, including how rescheduling may affect FDA oversight of certain Covered Marijuana Products and how increased federal attention may influence cannabis related litigation risk.

DLA Piper offers a cross-functional legal team with experience across FDA, DEA, false advertising, and products liability litigation. If you have questions on any issues discussed this alert, please contact the authors.