July 8, 2026
The DEA's long-awaited hearing on moving marijuana from Schedule I to Schedule III of the Controlled Substances Act opened June 29 and, per the administrative law judge's schedule, must conclude no later than July 15. Week one put the government's scientific case on the record — and gave opponents their first sustained chance to attack it. For operators, the next seven days will shape the evidentiary record that determines whether Schedule III survives its all-but-certain court challenges.
The proceeding is the formal, on-the-record phase of the rescheduling rulemaking. The DEA's hearing notice set presentations from June 29 through July 14, with the hearing to conclude by July 15. The government — DEA, defending its own proposed rule — presents witnesses supporting the Schedule III recommendation, while seven designated participants, all of whom oppose rescheduling, are permitted to present evidence and cross-examine.
That alignment is the structural oddity of this hearing: the agency that spent decades defending Schedule I is now the party defending marijuana's medical value, while prohibition-oriented groups sit across the aisle as the only cross-examiners.
The government opened with Dominic Chiapperino, director of the controlled substance staff at FDA's Center for Drug Evaluation and Research, who walked through the agency's finding that marijuana has a currently accepted medical use and a lower abuse potential than Schedule I and II comparators.
Cross-examination centered on the FDA's revised "two-factor" test for currently accepted medical use. Opponents attacked the analysis on day two, pressing the FDA on why it departed from the older five-factor framework — and drawing an acknowledgment that cannabis could not have satisfied the prior test. That admission is the fulcrum of the opposition's legal theory: if the medical-use finding required a new test, the finding is vulnerable on review. Cannabis Business Times reported that DEA's counsel came out aggressively in defense of the two-factor framework.
Outside the hearing room, the Justice Department filed a brief opposing an attempt by a drug-testing trade group and a pharmaceutical company to pause the proceedings, arguing the movants' real stake is financial: they profit from marijuana remaining in Schedule I. The government defending its rescheduling rule against industry incumbents is a posture worth noting — it signals DOJ intends to see the rule through the administrative process rather than let it stall.
The second week belongs largely to the designated participants. Smart Approaches to Marijuana began its presentation July 6; the same day, Harvard Medical School psychobiology professor Bertha Madras — a longtime rescheduling opponent — testified that products sold through state dispensaries are not developed under pharmaceutical standards. Additional participants, including victim-advocacy and state-level witnesses, are scheduled through July 14.
Expect the opposition to hammer three themes: the two-factor test's novelty, the gap between dispensary products and FDA-approved drugs, and impaired-driving data. None of these must persuade the administrative law judge to block rescheduling outright — the goal is building a record for appeal.
The hearing does not end with a scheduling decision. It closes the evidentiary record on which the ALJ will issue a recommended ruling; the DEA administrator then issues a final rule, and litigation is widely expected regardless of outcome. We covered what was at stake when the hearing opened and the participants and notice-of-intent filings earlier in the cycle.
For operators, the practical question is §280E. Schedule III would end the tax code's disallowance of ordinary business deductions for plant-touching companies — the single largest financial swing in the industry. Some operators have already filed refund claims or adjusted reserves in anticipation; the §280E stay motion we covered previously shows how contested that timing question remains. Nothing in week one changes the prudent posture: model both scenarios, document reserve decisions, and make no irreversible tax elections until a final rule is effective. Talk to your counsel and tax advisors before acting.
FDA's Dominic Chiapperino testified on marijuana's medical value and relative abuse potential; opponents pressed him on the agency's revised two-factor medical-use test.
A revised FDA analysis for determining "currently accepted medical use." An FDA official acknowledged during cross-examination that cannabis could not have passed the agency's prior five-factor test.
Presentations run through July 14, and the hearing concludes no later than July 15, 2026.
No. It builds the evidentiary record for the administrative law judge's recommendation. A final rule comes later, and litigation is expected either way.
DOJ opposed a drug-testing trade group and pharma company's motion to pause rescheduling, arguing they profit from marijuana remaining in Schedule I.
This article is for informational purposes only and is not legal advice. Consult your counsel before making compliance or tax decisions.
The DEA's long-awaited hearing on moving marijuana from Schedule I to Schedule III of the Controlled Substances Act opened June 29 and, per the administrative law judge's schedule, must conclude no later than July 15. Week one put the government's scientific case on the record — and gave opponents their first sustained chance to attack it. For operators, the next seven days will shape the evidentiary record that determines whether Schedule III survives its all-but-certain court challenges.
The proceeding is the formal, on-the-record phase of the rescheduling rulemaking. The DEA's hearing notice set presentations from June 29 through July 14, with the hearing to conclude by July 15. The government — DEA, defending its own proposed rule — presents witnesses supporting the Schedule III recommendation, while seven designated participants, all of whom oppose rescheduling, are permitted to present evidence and cross-examine.
That alignment is the structural oddity of this hearing: the agency that spent decades defending Schedule I is now the party defending marijuana's medical value, while prohibition-oriented groups sit across the aisle as the only cross-examiners.
The government opened with Dominic Chiapperino, director of the controlled substance staff at FDA's Center for Drug Evaluation and Research, who walked through the agency's finding that marijuana has a currently accepted medical use and a lower abuse potential than Schedule I and II comparators.
Cross-examination centered on the FDA's revised "two-factor" test for currently accepted medical use. Opponents attacked the analysis on day two, pressing the FDA on why it departed from the older five-factor framework — and drawing an acknowledgment that cannabis could not have satisfied the prior test. That admission is the fulcrum of the opposition's legal theory: if the medical-use finding required a new test, the finding is vulnerable on review. Cannabis Business Times reported that DEA's counsel came out aggressively in defense of the two-factor framework.
Outside the hearing room, the Justice Department filed a brief opposing an attempt by a drug-testing trade group and a pharmaceutical company to pause the proceedings, arguing the movants' real stake is financial: they profit from marijuana remaining in Schedule I. The government defending its rescheduling rule against industry incumbents is a posture worth noting — it signals DOJ intends to see the rule through the administrative process rather than let it stall.
The second week belongs largely to the designated participants. Smart Approaches to Marijuana began its presentation July 6; the same day, Harvard Medical School psychobiology professor Bertha Madras — a longtime rescheduling opponent — testified that products sold through state dispensaries are not developed under pharmaceutical standards. Additional participants, including victim-advocacy and state-level witnesses, are scheduled through July 14.
Expect the opposition to hammer three themes: the two-factor test's novelty, the gap between dispensary products and FDA-approved drugs, and impaired-driving data. None of these must persuade the administrative law judge to block rescheduling outright — the goal is building a record for appeal.
The hearing does not end with a scheduling decision. It closes the evidentiary record on which the ALJ will issue a recommended ruling; the DEA administrator then issues a final rule, and litigation is widely expected regardless of outcome. We covered what was at stake when the hearing opened and the participants and notice-of-intent filings earlier in the cycle.
For operators, the practical question is §280E. Schedule III would end the tax code's disallowance of ordinary business deductions for plant-touching companies — the single largest financial swing in the industry. Some operators have already filed refund claims or adjusted reserves in anticipation; the §280E stay motion we covered previously shows how contested that timing question remains. Nothing in week one changes the prudent posture: model both scenarios, document reserve decisions, and make no irreversible tax elections until a final rule is effective. Talk to your counsel and tax advisors before acting.
FDA's Dominic Chiapperino testified on marijuana's medical value and relative abuse potential; opponents pressed him on the agency's revised two-factor medical-use test.
A revised FDA analysis for determining "currently accepted medical use." An FDA official acknowledged during cross-examination that cannabis could not have passed the agency's prior five-factor test.
Presentations run through July 14, and the hearing concludes no later than July 15, 2026.
No. It builds the evidentiary record for the administrative law judge's recommendation. A final rule comes later, and litigation is expected either way.
DOJ opposed a drug-testing trade group and pharma company's motion to pause rescheduling, arguing they profit from marijuana remaining in Schedule I.
This article is for informational purposes only and is not legal advice. Consult your counsel before making compliance or tax decisions.
