The US Drug Enforcement Administration (DEA) recently released a new application process for medical cannabis businesses under its new Schedule III process.
Table of Contents
According to the Cannabis Business Times, companies have 60 days to register.
The DEA’s Medical Cannabis Registration Process
Under the DEA’s new Diversion Control Division, state-licensed medical cannabis manufacturers, distributors, and analytical labs can now use the new Form 225 to register to legally handle a controlled substance like cannabis under the Controlled Substances Act (CSA). So, state-licensed medical cannabis businesses can use the new Form 225 application process to register under the Controlled Substances Act.
DEA’s Diversion Control Division launched the new application process on October 5th for medical cannabis. The following companies can now register:
- Manufacturers (to cultivate, produce, process, package, label, and transfer cannabis)
- Distributors (to receive and transfer cannabis)
- Analytical Labs (to test cannabis)
This is more than five months after medical cannabis and cannabis products were ordered to be “immediately” rescheduled from Schedule I to III under the CSA by the acting US Attorney General Todd Blance.
The rescheduling action provides medical cannabis businesses with Section 280E tax relief under the Internal Revenue Code, where they get to write off their business expenses.
This is a prominent goal of many large adult-use cannabis companies and small companies who thought they’d benefit too.
Schedule III listing provides medical cannabis businesses with the recognition that their products have currently accepted medical use under federal law.
Federal Registration Details
Notably, registration is granted per physical location, not per person or per institution as a whole. Each place where controlled substances are stored, used, or dispensed generally needs its own registration.
Registration carries an application fee that DEA sets and periodically revises by rule. Processing time varies with application volume.
The DEA can deny, restrict, or revoke a registration on public-interest and compliance grounds set out in the CSA and 21 CFR 1301.36.
Form 225 is what gets a lab authorized to handle controlled substances in the first place, and what keeps that authorization current through renewal.
The controlled substance inventory is a recurring recordkeeping obligation under 21 CFR 1304.11 that applies once a lab is registered.
A lab can be current on its Form 225 registration and still be out of compliance on its inventory recordkeeping, or vice versa.
Federal Medical Cannabis Company Registration
The federal medical cannabis Form 225 registration has six sections:
- Section 1: Personal/Business Information
- 1b: Email Address Validation
- Section 2: Business Activity/Schedule
- Section 3: State License(s)
- Section 4: Background Information
- Section 5: Payment
- Section 6: Confirmation
The one-year, nonrefundable application fees are $3,699 for medical cannabis manufacturers, $1,850 for medical cannabis distributors, and $296 for analytical labs under the Form 225 tab.
Registration is granted per physical location. Each place where controlled substances are stored, used, or dispensed generally needs its own registration, rather than per person or per institution.
Typically, Form 225 is filed by two kinds of applicants:
- An institution registering a facility, core laboratory, vivarium, or pharmacy that supports several research groups
- An individual registering in their own name for a specific research program
Registration Revocation, Denial, or Restriction
The DEA can revoke, deny, or restrict a registration based on public-interest, state licensure problems, a registrant’s compliance history, and/or recordkeeping requirements.
The new federal medical cannabis regulation 21 CFR 1301.36 states that, “The Administrator may limit the revocation or suspension of a registration to the particular controlled substance, or substances, with respect to which grounds for revocation or suspension exist.”
