Schedule 1 Drug
Cannabis is considered a Schedule 1 drug, meaning that the U.S. Drug Enforcement Administration sees no medicinal properties in the substance and classifies it as highly addictive. Pot industry participants and outside experts are questioning the logic behind a split that considers medical marijuana a states’ rights issue and recreational a matter for federal regulation.
“I believe the product has hundreds of medical applications, positive ones, but this delineation is an artificial one given how Schedule 1 works,” said Adrian Sedlin, founder and CEO of Canndescent, a cannabis producer in Southern California. “There’s no basis to allow medical, but not allow recreational, under current law.”
States where both types of weed are legal have parallel regulatory frameworks. Though there are separate licenses, many producers do both. So a crackdown on weed growers under Spicer’s framework could mean wiping out half a company’s inventory while leaving the other half untouched.
“It’s just bizarre to think that the DEA could come to a place like in Aurora and raid one half of a store but not the other,” said Allen St. Pierre, board member of the National Organization for the Reform of Marijuana Laws, referring to the Denver suburb. “So this delineation that they put out there just adds a greater level of confusion.”
Different Missions
Some producers found comfort in Spicer’s acceptance of medical marijuana. Nick Vita, CEO of Columbia Care, which is licensed to operate about 20 medical dispensaries in nine states, said that it’s a good change and that the differentiation is warranted.
“It’s very important because they are two very different missions and types of activities,” Vita said.
In Colorado, where both kinds of marijuana have been legal the longest, medical sales have fallen as recreational weed increased. At Hageseth’s two stores, for example, medical business declined about 60 percent from this time last year. Since the same products are available, consumers are skipping the hassle of getting a prescription and simply using the recreational pot to soothe themselves, he said. If the Trump administration follows through, the trend could reverse -- boosting the medicinal market higher than anticipated.
Hageseth said he’s building a marijuana growing facility and starting a franchise business. But Spicer’s offhand comments already caused anxiety among some of Green Man Cannabis’ investors.
“I’ve had two people say they’re not moving forward until this is resolved,” he said. “We’re all on a train together that’s picking up speed and all of a sudden it’s stopped and we’re waiting to see what happens.”
This article was provided by Bloomberg News.