Cannabis stocks mark second day of gains as DEA confirms its review of marijuana's Schedule I classification

Cannabis stocks are notching their second day of gains after the Drug Enforcement Administration confirmed it's reviewing an August recommendation from the U.S. Department of Health and Human Services (HHS) to change the classification of marijuana to Schedule III from Schedule I under the Controlled Substances Act. In a letter to Rep. Earl Blumenauer, Democrat of Oregon, the DEA said it has "final authority" to make any rescheduling decisions. The Schedule III classification would potentially eliminate the costly 280E tax regime for cannabis companies that prevents state-legal cannabis companies from claiming customary business cost deductions. Curaleaf Holdings Inc. (CURLF) was up by 5%, after gaining 4.8% on Wednesday. Trulieve Cannabis Corp. (TCNNF) was up by 3.6% after a 2.2% rise on Wednesday. Green Thumb Industries (GTBIF) was up by 0.8% after gaining 3.5% in the previous session. Cresco Labs (CRLBF) rose 7.9%, after advancing by 8.2% in the previous session. Verano Holdings Corp. (VRNOF) was the outlier with a dip of 0.3% after rising 8.7% on Wednesday. TerrAscend Corp. (TSNDF) moved up by 1.1% after a 10.6% gain in the previous session. The Advisor Shares Pure U.S. Cannabis ETF (MSOS) rose 3% on top of a 5.6% jump on Wednesday. Under federal law, a Schedule 1 drug is defined as having no medical use. The classification includes heroin and LSD. Schedule III's definition allows for regulated medical use of a controlled substance.

-Steve Gelsi

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01-04-24 1355ET

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