Acting Attorney General Todd Blanche signed an order on April 23 reclassifying state-licensed medical marijuana as a less dangerous drug by moving it from Schedule I to Schedule III. The change does not legalize cannabis under federal law but alters how the drug is regulated, creating tax and research benefits for licensed medical cannabis businesses and easing some barriers for scientists studying its effects.
The rescheduling applies to medical cannabis and FDA‑approved cannabis products. The Department of Justice said the action “allows for research on the safety and efficacy of this substance, ultimately providing patients with better care and doctors with more reliable information.” President Trump told reporters he had received calls urging restrictions be lifted and directed his administration in December to move quickly on reclassification.
A June hearing has been scheduled to consider broader changes to cannabis’s federal status, but for now marijuana remains illegal at the federal level. Most states allow medical, recreational, or both types of use; only Idaho and Kansas lack any legal cannabis programs. Prior to this change, people researching or selling cannabis in states where it was legal could still face federal prosecution.
Under prior law cannabis was a Schedule I drug — grouped with substances like LSD and heroin as having high abuse potential and “no currently accepted medical use.” Reclassifying it to Schedule III places it with drugs such as acetaminophen with codeine: considered to have medical uses and lower abuse potential. Public opinion largely favors reform; a 2025 Gallup poll found 64% of Americans supported legalization, up from 36% in 2005.
For businesses, the shift promises substantial practical relief. Because cannabis will no longer be Schedule I in its state‑licensed medical form, companies should gain access to banking services and, importantly, be able to deduct business expenses on federal taxes for the first time. Industry leaders called the order historic: Terry Mendez, CEO of Safe Harbor Financial, called it “the most significant federal action on cannabis policy in more than 50 years.” Anthony Coniglio of NewLake Capital Partners said the move is a “material shift” for operators, investors, lenders, and real estate partners. Nico Richardson, CEO of Texas Original, said it will “benefit Texans who will have easier access to needed medicine.”
Researchers welcomed the change as well. Easier access and reduced regulatory red tape should make clinical studies simpler and less costly. Sasha Kalcheff‑Korn, executive director of Realm of Caring, said rescheduling “will make it easier to complete this research and conduct future studies,” helping build scientific evidence for cannabinoid therapies. Steven Gregoire of Quiet Monk CBD noted Schedule I restrictions had been “very restrictive in how, when, and if research can be conducted,” and that Schedule III status “increases the supply for research.”
Not everyone is fully satisfied. Some advocates argue the change does not go far enough, while others urge caution. Pam Jenkins, CEO of Shatterproof, stressed the need to protect young people, give clinicians clear guidance, and ensure the public understands risks, particularly for youth mental health. Kevin Sabet of Smart Approaches to Marijuana warned the reclassification could “send a confusing message” about cannabis safety and criticized the policy shift as influenced by industry interests.
The upcoming June hearing will be a key step in determining whether federal law will allow broader reclassification or other changes to cannabis policy. For now, the April 23 order marks a major federal policy shift that eases tax and research burdens for state‑licensed medical cannabis but stops short of full federal legalization.
