In Defense of Rescheduling
"Il meglio è l'inimico del bene" Italian Proverb, translated as “the best is the enemy of good.”
RIII will be a historic chapter in the march to full legalization of cannabis in the USA.
What’s not to like?
Plenty, according to a small but vocal minority of pro-cannabis Americans who lobby against rescheduling.
Let’s scrutinize a few of their arguments. RIII…
1. Doesn’t go far enough
I don’t know any person who believes reform should or will stop here. Not being perfect doesn’t mean RIII shouldn’t be celebrated for its symbolism and significant economic benefits. One can’t scoff at ~$250M in industry tax savings, greater tax equity, valuation lifts or the possibility for new developments such as uplisting to major US exchanges.
We also shouldn’t poo poo the impact of extra cash flow. This money will address balance sheet issues, be reinvested in operations, or given back to long suffering shareholders via dividends. The overall result will be more jobs, higher salaries and healthier firms.
Other criticisms focus on what RIII doesn’t do such as improving banking access and addressing federal criminal penalties for cannabis. This is a facile argument. RIII is not legalization. Expecting it to be is unrealistic and naive.
2. Will lead to Big Pharma's dominance of cannabis
This is a silly objection if you really care about getting more cannabis medicine in the hands of patients as quickly as possible. In the real world, you need well-capitalized and expert pharma companies that can fund drug R&D through an expensive and time-consuming FDA regulatory process. There are no shortcuts. RIII is a timely and essential first step along this long-overdue path. And to be clear, RIII does not preclude MSOs for undertaking drug development activities. In fact, it enables it.
Underpinning the opposition is a dislike of the US healthcare system and pharma sector. These are legitimate gripes. However, we need to be mindful that no federally legal market has redesigned their drug approval process or healthcare system to accommodate cannabis.
3. Only benefits the large MSOs
Strange. If anything, RIII levels the playing field by enabling ALL MSOs to avoid 280E versus what we have today where only the deep pocketed and legally connected MSOs can secure refunds. Yes, RIII could add compliance costs and hassle since RIII requires the FDA to regulate the entire plant and its commercial activities. However, these extra costs will pale in comparison to what MSOs pay with 280E. Moreover, there is value in having a single (albeit imperfect) regulator that can bring important oversight in areas like marketing claims.
Ask yourself: is the industry better off today with RIII or without? If you are objective and knowledgeable, the answer is obvious.
#rescheduling #280E #FDA #regulations #scheduleIII #taxes