What marijuana reclassification could mean for health treatments

This story was republished with permission from Modern Healthcare and written by Alex Kacik.

The federal government is poised to remove marijuana from the most dangerous class of drugs, which could open up more clinical treatments and research opportunities.

The Justice Department is recommending reclassifying marijuana as a Schedule III drug, down from a Schedule I drug. Its proposal, which would need to be cleared by the White House Office of Management and Budget, could allow researchers to investigate marijuana’s clinical applications more broadly.

Related: Federal addiction treatment dollars off-limits for marijuana

Still, many questions remain as to how marijuana would be used, how open providers and patients would be to marijuana as a medical treatment, and what coverage and payment for such treatments would look like.

Here’s what to know about how marijuana could be used in the clinical setting.

What are Schedule I drugs?

Schedule I drugs, including marijuana, heroin, psilocybin, and ecstasy, have the most regulatory restrictions on research, supply, and access since the Drug Enforcement Administration deems them high risk and without currently accepted medical use.

That means the Health and Human Services Department, the Food and Drug Administration, and DEA must approve researchers’ marijuana-related studies, posing a significant barrier to entry. Only the University of Mississippi farm has federal approval to grow marijuana, and only some strains and potency levels.

Even so, the limited research on marijuana and psilocybin has shown that they can be used to treat post-traumatic stress disorder and depression, among other ailments.

Will marijuana be used more widely?

More than 8.3 million people reported using doctor-recommended marijuana in 2020, according to a 2023 study published in the American Journal of Preventative Medicine. While that number is expected to increase if the federal government reclassifies marijuana, it’s unclear what use of the drug will look like in the clinical setting.

Even in more traditional drug approvals, it tends to take time for treatments to be widely accepted by providers and patients.

“The widespread adoption of marijuana-based treatments in clinical settings would likely be a gradual process that depends on the accumulation of evidence, regulatory decisions and shifts in professional and public perceptions,” said Tony Yang, a health policy professor at George Washington University.

Take biosimilars, which are less expensive copies of biologic drugs made from living organisms, as an example. While the Food and Drug Administration has approved around 50 biosimilars since 2015, biosimilar use has been relatively slow as patients and providers become more familiar with the products and the regulatory approval process.

For instance, certain biosimilars used as immunosuppressants, as synthetic forms of insulin, and to stimulate white and red blood cell production only gained 23% market share three years after they hit the market, according to a first-quarter market report from Samsung Bioepis.

Who would pay for marijuana?

Providers’ clinical use of marijuana may also hinge on reimbursement.

Lingering questions remain on whether health insurance plans and payers, including Medicare and Medicaid, would cover medical marijuana prescriptions, as well as what copayments would be implemented, Yang said. Other questions include whether physicians would be reimbursed for medical marijuana-related patient evaluations and follow-up visits, how dispensaries would be reimbursed and if payment policies would be affected by discrepancies between state and federal laws, he said.

Medicare and some insurers already cover Epidiolex, an epilepsy drug made from marijuana.

Even if Medicare and other commercial insurers don’t initially cover marijuana, there is a growing set of venture capital funds for ketamine and marijuana-derived drugs that may provide funding, said Cody Powers, a principal at the consultancy ZS, which focuses on pharmaceuticals.

“I would expect those funds to initiate fundraising off of this development at some point,” he said.

Several insurance companies and associations that represent insurers declined to comment, but some insurers argued in a recent court case that federal law prevents them from paying for marijuana. Even if marijuana is reclassified, Schedule III drugs are still illegal under federal law.

Medical marijuana patients and a marijuana dispensary in New Mexico filed the lawsuit in state court in 2022 against several insurers, alleging they should pay for marijuana used to treat mental health. The pending lawsuit has since been transferred to a New Mexico federal court.

How could reclassifying marijuana affect health care research?

Reclassifying marijuana would make it easier for researchers to access and study marijuana.

To study Schedule I drugs, research institutions must thoroughly document how they plan to distribute, receive, and track the drugs, Powers said. The regulations are much easier to meet for Schedule III drugs, likely leading to more studies, as long as there’s demand from drug makers and providers, he said.

Schedule III drugs have a low risk for of abuse and have some medical value, according to the DEA. Under that classification, academics and scientists would have more flexibility to study different marijuana strains, extracts and formulations, Yang said.

“With the reduced regulatory barriers, the reclassification could pave the way for more clinical trials to evaluate the efficacy of marijuana-based treatments for various medical conditions,” he said.

Several academic health systems and provider associations declined to comment on how reclassifying marijuana could impact research.

At some point, research findings will pave the way for FDA approval, said Monica Hon, vice president at the health care consultancy Advis.

“To be recognized as a viable choice for treatment would legitimize marijuana at a national level,” she said.

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