Biden gives cannabis industry a badly needed win

The U.S. Drug Enforcement Agency is recommending that cannabis be reclassified as a Schedule III drug, which would codify that it has medicinal value and is less dangerous than its current Schedule I designation, Axios has confirmed.

Why it matters: The U.S. cannabis industry needed a win, just days after one of its best-known companies, MedMen, filed for bankruptcy protection.

Venture capital investment in cannabis companies has fallen sharply in the past couple of years, totaling just $550 million in 2023 after hitting $3 billion in 2019 and $2.7 billion in 2021, according to PitchBook.

Publicly traded stocks also have slumped. Curaleaf shares, for example, opened yesterday down 70% from their 2021 highs.

The big picture: Rescheduling would allow cannabis companies to deduct business expenses on their taxes, which would particularly help dispensaries that typically operate on very tight margins.