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The DEA Actually Didn't Reschedule CBD: Industry Insiders Explain What Epidiolex's Reclassification Really Means

For decades the DEA has insisted nothing derived from cannabis has any legitimate use. Epidiolex is the first exemption that many believe will lead to a new rule.

Opinions expressed by Entrepreneur contributors are their own.

GW Pharmaceuticals recently made headlines across the U.S., after the DEA re-scheduled its cannabis-derived drug Epidiolex, moving it from the Schedule I category (which it previously shared with highly-addictive drugs like heroin and LSD) to the Schedule V category, which implies accepted medical uses and low potential for abuse.

GW Pharma

Epidolex is the first FDA-approved drug to contain CBD, one of the most common compounds found in the cannabis plant. It is intended for patients with treatment-resistant Lennox-Gastaut syndrome, or LGS, a rare form of childhood-onset epilepsy. While the re-scheduling is specific to this drug for the time being, and does not apply to other CBD-containing products or drugs as many outlets reported, the language in the DEA’s announcement does suggest we might see other drugs join Epidiolex in the Schedule V group over the next few years.

“DEA will continue to support sound and scientific research that promotes legitimate therapeutic uses for FDA-approved constituent components of cannabis, consistent with federal law,” said Acting DEA Administrator Uttam Dhillon. 

To get a clearer idea of what the rescheduling of Epidiolex really means for the cannabis industry, Entrepreneur reached out to a few insiders and asked them to share some thoughts.

“It’s important to note that this reschedules a very narrow class of pharmaceutical drugs, not CBD itself,” Ben Adlin, editor at Leafly told Green Entrepreneur. “For now, the only product this affects is Epidiolex, a cannabis-based epilepsy medication that's expected to cost more than $30,000 a year. In the eyes of the DEA, every other form of CBD remains a Schedule I drug -- on par with heroin and LSD -- even though these products are already widely available online and in stores across the country.”

Down a similar lane, Serge Chistov, the financial partner for Honest Marijuana Company, added: “CBD was reclassified as a part of the Food and Drug Administration's approved medication. Not, however, the CBD that you and I can purchase in a local store or from the farmer. The CBD that was reclassified is a part of the process the FDA requires a company to go through for a new drug application.”

Chistov explained that this means that, going forward, companies will be allowed to apply for FDA approval of drugs containing CBD. “This does not change anything for the supplements or pseudo-farmer manufacturers in the cannabis, THC and CBD world,” he said, acknowledging that the federal government recognizing that “at least one of the cannabinoids” found in marijuana can offer medical benefits “under certain conditions” is still a “decent and positive move.”

Related: This Is Non-Negotiable: Cannabis Legalization Must Include Restorative Justice

A step in the right direction.

One theme among the many opinions we heard is that while not the ultimate goal, the rescheduling of Epidiolex is a step in the right direction. In fact, many companies went as far as issuing press releases applauding the DEA for its move and GW Pharma for its success.

Adding to these points, Jon Cooper, CEO of cannabinoid research company ebbu explained that, “By rescheduling this FDA-approved CBD medicine, the DEA is confirming there are legitimate medical properties to this cannabinoid, which is an historic step forward for cannabis and its many components. This move will eventually create further opportunities for research into the plant’s many other cannabinoids, and it will also kickstart the development of more cannabis-based products to address patient and consumer needs.”

Morris Denton, CEO of Texas-licensed medical cannabis cultivator-producer-retailer Compassionate Cultivation seemed to agree. “This acknowledgement by the federal government that CBD holds demonstrable medical use and low risk of abuse is groundbreaking,” he told Entrepreneur, calling Texas lawmakers to “take note for the upcoming legislative session as they consider potential expansion of the state medical cannabis program to include many other deserving conditions that could be helped with low-THC, high-CBD products.”

Meanwhile, Maruchy Lachance, a veteran of the nutraceutical space and the chief operations officer and co-founder of hemp-derived CBD cultivator-processor Boulder Botanical & Bioscience Laboratory noted that, “As has been successfully demonstrated in a majority of states, medical cannabis programs provide patients with a valuable treatment option to potentially ease their suffering and improve the quality of their lives. The DEA’s rescheduling will be the gateway for future development of CBD products and research into the practical uses for this important cannabinoid compound in everyday wellness, sports medicine and other treatments.”

Related: Why These Teenage Girls Started a CBD Lifestyle Brand

Evan Eneman is the co-founder of Snoop Dogg's VC fund Casa Verde Capital, co-founder of ELLO and National Cannabis Practice Leader for MGO/ELLO, and founder of Fiorello. In other words: a prolific cannabis investor and entrepreneur. So, when we asked him about the DEA’s latest move in cannabis, he had a lot to say.

“The re-scheduling of CBD-derived medicines by the DEA may feel like incremental progress, but in fact, it’s the foreshock of a seismic shift to come,” he said, mentioning a complete re-scheduling of CBD and, eventually, THC-based cannabis products was the ultimate goal, the real battle.

“While this move is seemingly limited in scope, it is just the first crack in the previously impregnable Federal stance on anything cannabis-related. Perhaps even more importantly, commonly accepted (and medically verified) use of cannabis-derived products has already, and will continue to, shift public perception of cannabis and its effects. Information is power,” Eneman concluded.