President Donald Trump’s executive order shifts cannabis from Schedule I to Schedule III and launches a Medicare pilot program for CBD products. Brandon Gomez unpacks what's next, the hurdles ahead and what shifted the president's stance on the drug.

President Trump has issued an executive order instructing the DEA to reclassify cannabis from Schedule 1 to Schedule 3, which would ease restrictions on medical research, banking, and taxes. The administration also announced a Medicare pilot program starting in April, allowing some seniors to receive up to $500 per year in hemp-derived CBD products.

The reclassification is not yet final, as it must undergo a formal challenge period and possible litigation. Congress has passed a ban on all hemp products effective November 2026, which could impact the pilot program. The executive order signals a calculated, medically-focused approach to cannabis reform, influenced by increased industry lobbying and the upcoming 2026 election cycle.

Trump signs executive order to reschedule cannabis

Our Brandon Gomez has more on why that move came about and why now. Hey, Brandon. Instead, investors clearly seeing more haze ahead. Still, the group holding solid gains month to date. Let's start with what actually happened yesterday. President Trump signed an executive order directing the DEA to reclassify cannabis from Schedule 1 to Schedule 3. Now, that eases restrictions on medical research, banking and taxes. The administration also launched a Medicare pilot program, allowing some seniors starting in April to receive up to $500 a year in hemp-derived CBD products. So why the pullback this week? Well, for starters, this isn't final yet. Once the DEA finalizes the change, there's a formal challenge period, likely litigation. And Carl, there will be challenges. Congress just passed a ban on all hemp products starting November 2026, including the very CBD products under this pilot. Now, the order does say that the White House will, quote, work with Congress to update the statutory definition of final hemp-derived cannabidoid products. But what that ultimately looks like remains to be seen. Now, beyond the logistics hurdle, Carl, the big question is, why now? Well, the president has long taken an anti-drug stance. But behind the scenes, there's been growing industry engagement, including TruLeaf CEO Kim Rivers, who was on D.C. or who was in D.C. yesterday, and intensified lobbying in Washington. Back in September, the president even shared a medical CBD commercial produced by longtime friend and supporter Howard Kessler. Now, you put all that together, and this EO is less a sudden shift and more calculated in timing. It's testing a limited medically-focused path to reform, not to mention appealing to states already moving ahead and keeping tighter controls in place as the 2026 election cycle starts to come into view here, Carl. A couple of things occur to us, Brandon. One is just how powerful is the lobby, since the business, the industry is relatively young, highly fragmented. A lot of it's Canadian. And then the other is the influence of RFK Jr. and what HHS thinks about all this. Yeah, absolutely. And I did reach out to HHS. They said this is in the hands of the White House. They didn't have a comment on the matter itself. But we do know that RFK Jr. has been a fan of these alternative medicines, you know, to date. But in addition to the lobbying efforts, we've really seen an uptick year over year in cannabis's influence in D.C. And I think that that really speaks to what you're seeing here. It's getting these surveys, these polls on the president's radar so that he can see that perhaps this is appealing to younger voters, to the senior voters as well, as we again head to this sort of 2026 midterm election process.

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