
The DEA indicated it could revisit the matter if the Ninth Circuit Court remanded the case.
The DEA indicated it could revisit the matter if the Ninth Circuit Court remanded the case.
The legality and safety of Delta 8 THC remains uncertain, yet it continues to attract entrepreneurs and investors.
Hemp was legalized in 2018, but CBD remains in a legal gray area.
The Daily Hit is a recap of the top financial news stories for February 15, 2023.
Twitter Eases up on Cannabis Marketing
Cannabis companies will be able to market their brands and products on Twitter in the U.S., reversing long-standing rules on whether marijuana should be advertised on the platform in the country. U.S. companies also can market their delivery services, labs, growing technology, search engines, and events on at least one platform. Read more here.
Virginia GOP Lawmakers Kill Recreational Cannabis Bill, Again
Republicans in the GOP-controlled Virginia House of Delegates have again torpedoed a bill that would have launched a recreational cannabis market in the state next year, possibly killing the last chance the existing medical marijuana industry had of starting adult-use sales in the near future. Read more here.
Cannabinoid Drug to Treat Autism Receives Phase 2,3 FDA Trial Funding
Zelira Therapeutics Ltd (ASX: ZLD) (OTCQB: ZLDAF) received $8.6 million in funding from U.S.-based investment firm Cantheon Capital LLC to conduct phase 2 and phase 3 clinical trials for its proprietary and patented protected HOPE-1 product targeting autism spectrum disorder via a special purpose vehicle (SPV). Read more here.
Union Square Travel Agency Dispensary Opens in New York City
UNION SQUARE TRAVEL AGENCY: A CANNABIS STORE, opened on Feb, 13. The store has a robust portfolio of products from New York farmers including premium flower, pre-rolls, edibles, vapes, accessories, and more, many from BIPOC and woman-owned brands. Watch video of the grand opening here.
DEA Rules Synthetic Cannabinoids Not Hemp, Still Banned
The U.S. Drug Enforcement Administration has taken a stance – albeit fairly quietly – that synthetic cannabinoids such as Delta-8-THCO and Delta-9-THCO are still controlled substances and thus illegal, even if they’re derived from hemp. Read more here.
Trulieve Cannabis
Multistate operator Trulieve Cannabis (OTC: TCNNF) donated an additional $5.5 million to efforts to legalize adult-use marijuana in Florida. According to Orlando Weekly, the Tallahassee, Florida-based company has donated a total of $25.5 million so far to the Smart & Safe Florida campaign, which is working to get adult-use legalization on the November 2024 ballot. Read more here.
Pennsylvania Department of Health
The Pennsylvania Department of Health is again suing Spotlight PA in an attempt to keep information about how patients obtain a medical marijuana card secret from the public. This time, the health department does not want to reveal how often individual physicians approve patients for the medical program — information that could help identify outliers who might be bending or breaking the state’s rules. Read more here.
Louisiana
Gov. John Bel Edwards (D) said Louisiana residents will see a government clampdown on unregulated THC products that can cause a person to get high. The governor and legislators may also seek to tweak a related law about hemp products during the Louisiana Legislature’s spring session. Read more here.
The federal agency has not been publicizing its stance, however.
An active Drug Enforcement Administration (DEA) pharmaceutical cannabis license holder, Biopharmaceutical Research Company completed a $20 million Series A fundraise. BRC said the raise will help it aggressively scale its operations and increase its product offering, conduct sponsored research, and execute its go-to-market strategy.
“Receiving our DEA Schedule I registration in 2021 allowed us to significantly advance our research capabilities, optimize our cannabis growing operation, and produce novel cannabis-derived products in a federally compliant manner. This significant new financial infusion will further accelerate our ability to grow as a business, while establishing BRC as an industry leader,” said George Hodgin, BRC CEO. “Intrinsic not only provides us with the cash we need to scale aggressively, they also bring a wealth of experience in the pharmaceutical space. We’re so grateful to the Intrinsic team and to our other partners for seeing the high-growth potential of our work.”
According to the statement, BRC said that in 2021 it was one of a small number of American companies awarded a production license from the DEA to produce clean, consistent, and compliant cannabinoids for federally approved researchers across the United States. BRC said it has partnered with academic research institutions including Washington State University and the University of California-Davis.
The round was led by Intrinsic Capital Partners, with participation from Argonautic Ventures, Achari Ventures, AFI Capital Partners, Delta Emerald Ventures, Self Health America (SHAC) and a number of preeminent family offices.
“BRC has exactly the kind of high-growth potential our fund looks for in a company,” said Intrinsic Managing Partner Howard Goodwin M.D. “They’re a mission-driven company with excellent leadership in a high-growth industry, and we’re thrilled to have engaged with a business that is already in a significantly advantageous position given their unique ability to be fully compliant with the DEA.”
For years, the University of Mississippi had been the only legal place for cannabis to be grown for the government. However, in May 2021 the DEA opened the program up to other third-party applicants. “Pending final approval, DEA has determined, based on currently available information, that a number of manufacturers’ applications to cultivate marijuana for research needs in the United States appears to be consistent with applicable legal standards and relevant laws. DEA has, therefore, provided a Memorandum of Agreement (MOA) to these manufacturers as the next step in the approval process.”
That sparked several companies to apply for DEA approval. The Scottsdale Research Institute in Arizona received approval in May 2021 and Biopharmaceutical Research Co. in California received approval shortly thereafter. Royal Emerald Pharmaceuticals in California, received approval in December 2021, followed by Groff North America, based in Pennsylvania, in March 2022 and California-based Irvine Labs in April 2022. More recently, Bright Green (NASDAQ: BGXX) stated in its prospectus, “In May 2021, we entered into the MOA with the DEA, which outlines the terms of the DEA’s conditional approval of Bright Green to proceed through the DEA’s registration process, as described above. The MOA with the DEA is effective for a one-year term, renewable for up to four additional one-year terms. These terms are agreed to by both the DEA and BGC, and the MOA is filed under DEA Document Control Number W20078135E. There is no guarantee that we will obtain the necessary authorization now, or in the future for renewal purposes.”
The pressure is ramping up on the U.S. Drug Enforcement Administration (DEA) as more lawyers, clinicians, researchers, investors and business owners working in the psychedelics industry are demanding clear answers about how the DEA should be evolving on its drug scheduling and enforcement strategy.
Right now, LSD, psilocybin, MDMA and peyote (mescaline) are all listed by the DEA as Schedule 1, meaning they have been determined to have a high potential for abuse and no accepted medical use.
The DEA’s Schedule II of supposedly less harmful drugs include cocaine, oxycontin, fentanyl and Adderall.
Less harmful? In 2021, the United States suffered more fentanyl-related deaths than gun- and auto-related deaths combined, according to the DEA. There were 1,305 deaths from cocaine in the first six months of 2021 in Florida alone.
Clearly, these Schedule II drugs are much worse substances than the psychedelics listed on Schedule 1. This misguided scheduling of psychedelics represents an insight into the contradictions and plain bad decision-making within the DEA that is coming under increased scrutiny.
Here is a list of more actions that are mixing up the DEA in a tangled web of two-steps-forward-three-steps-back events over just the last year:
– October 13, 2021. Novamind Inc. (CSE: NM | OTCQB: NVMDF | FSE: HN2), a mental health company specializing in psychedelic medicine, announced it was been granted two Schedule 1 licenses from the DEA: one for Dr. Reid Robison, Novamind’s chief medical officer, and one for Dr. Paul Thielking, the company’s chief scientific officer. The DEA licenses are required for research sites planning to host clinical trials for psilocybin, enabling principal investigators to store and administer this controlled substance.
– November 4, 2021. Cybin Inc. (NEO:CYBN) (NYSE American:CYBN), announced that it was granted a Schedule I manufacturing license from the DEA for the company’s research lab in the Boston area.
– January 14, 2022. The DEA shocked industry watchers with a proposed rule putting relatively obscure psychedelic substances on Schedule 1—4-Hydroxy-N,N-diisopropyltryptamine (4-OH-DiPT); 5-Methoxy-alphamethyltryptamine (5-MeO-AMT); N-Isopropyl-5-Methoxy-N-Methyltryptamine (5-MeO-MiPT); N,N-Diethyl-5-methoxytryptamine (5-MeO-DET), and N, N-Diisopropyltryptamine (DiPT). The DEA based their decision on scientific and medical evaluations by U.S. Department of Health and Human Services (HHS) from 2012, after the DEA had been gathering information about the substances since 2008… leading to suspicions about the January, 2022 timing of this scheduling proposal which came just a day after the National Institutes of Health hosted a two-day psychedelics workshop about research gaps and opportunities in psychedelic drug development. The DEA proposal immediately prompted a flurry of outrage from the psychedelics community. Nearly 600 comments were collected, ranging from sarcastic historical review to downright disbelief. DEA identified 31 domestic suppliers of one or more of the listed substances; thirty of the 31 domestic suppliers are not registered with DEA to handle controlled substances and, if the proposal became DEA policy, would have to turn in their supplies. They would not likely be able to buy a DEA license. The DEA reported that it expected the lost sales to these small businesses to be minimal.
– January 18, 2022. U.S. Congressman Earl Blumenauer (D-OR) led a bipartisan group of six lawmakers in urging the DEA to stop blocking terminally ill patients’ access to therapeutic psilocybin treatments.
– May 9, 2022. More than a dozen activists staged a “die-in” outside the DEA headquarters in Arlington, Virginia, demanding that the DEA allow patients with life-threatening conditions to legally access psilocybin. 17 are arrested.
– July 6, 2022. DEA reported that it received numerous comments and four requests for a hearing on their proposed rule, as provided in 21 U.S.C. 811(a). They scheduled a public hearing on the rule for August 22, 2022.
– July 19, 2022. Dr. Sunil Aggarwal, who specializes in palliative care and is the co-founder and co-director of the AIMS Institute, an advanced integrative medical care facility for patients living with chronic and serious illness, sued the DEA, along with other plaintiffs, over their policy and pattern of “flagrant Freedom of Information Act abuse” regarding requests for the DEA to provide information about reclassifying psilocybin from a schedule I controlled substance to a Schedule II controlled substance. The plaintiffs also requested a waiver about access to psilocybin for limited therapeutic use under state and federal Right to Try Laws (RTT).
– July 20, 2022. U.S. Senators Cory Booker (D-NJ) and Rand Paul (R-KY), supported by Rep. Nancy Mace (R-SC) and Rep. Earl Blumenauer (D-OR), introduced legislation to clarify the Right to Try Act (RTT), which permits/allows eligible patients to have access to eligible investigational drugs. RTT is designed to allow terminally ill patients to have access to Schedule I drugs for which a Phase 1 clinical trial has been completed. Specifically, the Booker/Paul legislation, the Right to Try Clarification Act, would remove any obstacle from the DEA’s Controlled Substances Act and Schedule I substances listing to get access to drugs such as MDMA and psilocybin.
– July 22, 2022. The DEA’s scheduling proposal is withdrawn. “Upon further consideration, DEA has determined that it is appropriate to submit a new request to the Department of Health and Human Services (HHS) for an updated scientific and medical evaluation and scheduling recommendation for these substances. DEA is withdrawing the proposed rule and notice of hearing that was published in the Federal Register on July 6, 2022, and is canceling the public hearing and terminating the pending hearing proceedings. DEA may issue a new proposed rule in the future regarding these substances if warranted.”
Bright Green (NASDAQ: BGXX) is a cannabis company with no revenue that just began trading on the NASDAQ, despite the exchange’s insistence that it won’t list U.S. cannabis companies due to the product being federally illegal. Bright Green plans to produce cannabis for research purposes with the Drug Enforcement Agency‘s (DEA) blessing, which seems to be the reason why the NASDAQ has allowed the company to trade. It would be considered federally legal cannabis. The stock is trading at $26.
Bright Green states in its prospectus, “In May 2021, we entered into the MOA with the DEA, which outlines the terms of the DEA’s conditional approval of Bright Green to proceed through the DEA’s registration process, as described above. The MOA with the DEA is effective for a one-year term, renewable for up to four additional one-year terms. These terms are agreed to by both the DEA and BGC, and the MOA is filed under DEA Document Control Number W20078135E. There is no guarantee that we will obtain the necessary authorization now, or in the future for renewal purposes.” Previously, only the University of Mississippi held such authorization.
Green Market Report has asked the DEA to confirm this agreement but has not received a response as of yet.
The company only has two employees a Chief Executive Officer and a Chief Financial Officer. No one on the board has any cannabis experience whatsoever and mostly comes from the automotive industry. Plus, the company is already involved in two lawsuits one of which is involving the company’s former CEO John Fikany. Terry Rafih is the Chairman of the Board and Edward Robinson is BGC’s Chief Executive Officer and Director. Robinson was the Chief Executive Officer of BMW Financial Services for the America’s Region from April 2005 to December 2016. Douglas Bates resigned as Chief Financial Officer in March 2022. Saleem Elmasri was appointed as his replacement in March 2022.
“We plan to sell cannabis to research institutions pursuant to our conditional approval from the DEA. Sales of THC cannabis products will be made only via bona fide supply agreements from existing DEA registrants, and not directly to consumers. Following final approval from the DEA, Bright Green will receive a Controlled Substances Bulk Manufacturing License to cultivate and manufacture cannabis for sale to federally funded research institutions and other purposes. There is no guarantee that we will receive final approval from the DEA.”
The company has also said that it plans to sell high CBN and CBG cannabis directly to consumers if and when cannabis legalization occurs at the federal level. “We also plan to leverage our cultivation, research, and manufacturing facilities to develop and commercialize approved medical cannabis products to sell to DEA registered pharmaceutical producers. BGC plans to sell mostly extracted oils from medicinal plants grown in these high-tech facilities and processed onsite through a proprietary system that vertically integrates the genetically altered growth of the plants to conform to automated growing systems. Once the two larger greenhouses are constructed, we estimate we can process 5,000 pounds of dry plant biomass per day to produce 220 pounds of distillate, which can create 85,000,000 milligrams of cannabinoids per day.”
The company must be hoping that by going public it will raise the money necessary for the lofty building ambitions. It had a negative operating cash flow of $1,656,575 in the fiscal year ended December 31, 2021, and $513,337 for the year ended December 31, 2020. The company’s filing states it only has $1.2 million in cash on hand as of the end of 2021.
The company said it plans to spend $76 million in 2022 on its greenhouse facilities, $161,200,000 in 2023, and another $60,000,000 in 2024 for a total of $297 million.
BGC owns a 70-acre parcel of land, on agricultural property, which includes an existing 22-acre greenhouse structure. The company also owns a 40-acre parcel of land nearby and holds options for two additional 300-acre properties which are adjacent to the owned properties (one is known as the “Candelaria” property, and the other is known as the “Azuz” property). The existing 22-acre greenhouse will be used to cultivate non-cannabis herbs and medicinal plants.
In addition to the existing greenhouse, BGC will be undergoing new construction to establish a state-of-the-art facility headquartered on our property in Grants, NM that will include two 57-acre greenhouses and a two-acre University Greenhouse (the “Fast Start University Greenhouse”) to begin housing our cannabis research, development, cultivation and manufacturing operations. This first greenhouse facility will have a production capacity for 50,000 cannabis plants at all times of differing maturity levels. Additionally, we estimate we will harvest approximately 300,000 mature plants per year (with multiple harvests per year).
The Fast Start University Greenhouse will house our research and development facility pursuant to potential partnerships and other arrangements with leading U.S. universities. The Fast Start University Greenhouse is expected to be complete by October 2022 though there may be delays due to global supply chain issues. “Our first harvest will be complete approximately two months from the date of completing construction. We will take a phased approach to the build out of Phase 1 and Phase 2 and will plant intermittently as phases of each greenhouse reach completion with estimated planting dates to be completed in tranches as follows: March 2023, September 2023, March 2024, September 2024.”
The BGC process says it will draw on expertise from Aurora Larssen Projects, which has completed over 50 fully legal cannabis projects in jurisdictions throughout the world. However, BGC “has not entered into a formal agreement with the company.” Aurora Larssen is owned by Aurora Cannabis (NASDAQ: ACB). BGC says it will start with tissue cultures from Nordic Supreme, which will provide proven cannabis genetics from Denmark, and then have best practices developed by Aurora Larssen.
The company is already facing two lawsuits before even getting started. These cases are listed in the company’s filing:
Bright Green Corporation v. John Fikany, D-1333-CV-2020-00231, State of New Mexico, County of Cibola, Thirteenth Judicial District. In this matter, the Company filed a complaint for declaratory judgment against the former acting Chief Executive Officer of the Bright Green Group of Companies, an entity unrelated to the Company, to determine if defendant is entitled to 5,000,000 shares of the Company’s common stock, based on a failure to fulfill agreed-upon conditions precedent to earning such shares from the Company. Defendant counterclaimed and filed a third-party claim against Lynn Stockwell, founder and a director of the Company, and Ms. Stockwell’s husband, for claims including wrongful termination and breach of contract. The Company denies defendants allegations and have set forth arguments refuting defendant’s counterclaims and third-party claims. The case is in the discovery phase. The Company is exploring potential dispositive motions against the counter and third-party claims.
Bright Green Corporation v. Jerry Capussi, D-1333-CV-2020-00252, State of New Mexico, County of Cibola, Thirteenth Judicial District. In this matter, the Company and defendant, a former consultant of BGGI, a predecessor to the Company, have each filed claims for declaratory judgment seeking to determine by court order whether defendant is entitled to (i) shares of common stock in the Company (amounting to no more than 108,000 shares) or (ii) fair market value of defendant’s equity ownership of BGGI. The lawsuit is in early discovery stages, and we are preparing arguments for a summary judgment motion. There are no claims for specific monetary liability against either party.
Biopharmaceutical Research Company LLC
Groff NA Hemplex LLC
Irvine Labs, Inc.
National Center for Development of Natural Products
Royal Emerald Pharmaceuticals Research and Develop
Scottsdale Research Institute
A group of defendants recently took on the federal government to protect their rights of using the psychedelic ayahuasca in their religious ceremonies. But things didn’t go their way.
The case involved the seizure of ayahuasca and the arrest of members of the North American Association of Visionary Churches (NAAVC), a California non-profit interdenominational association of visionary churches; and Arizona Yage Assembly (AYA), another California non-profit church.
Opposing them according to their original complaint filed May 5, 2020, were defendants William Barr on behalf of the Department of Justice (DOJ); Uttam Dhillon on behalf of the Drug Enforcement Administration (DEA); Chad F. Wolf on behalf of the Department of Homeland Security (DHS); Mark A. Morgan on behalf of Customs and Border Protection; and Thomas Prevoznik, deputy assistant administrator of the DEA Department of Diversion Control.
And.. the United States of America.
According to court documents (case 3:20-cv-03098-WHO), here is what happened: On April 22, 2020, NAAVC and AYA were notified that their joint property, a container of ayahuasca ordered for the use of NAAVC and AYA, had been seized by DHS during the customs process. Three other shipments of ayahuasca were allegedly seized by DHS between April and December 2020.
This was an outrageous act, the AYA lawyer said in the complaint because organizers and members of the churches believe that the experience of communion through ayahuasca is “the receipt of Divine Love and wisdom by the congregation.”
Lawyers said that the administration of sacramental ayahuasca to congregants is protected as free exercise, but that it is “burdened by the proscriptions of the controlled substances act (CSA) and the DEA’s denial of regulatory services to visionary churches; and that the DEA is required to issue a certificate of exemption to AYA, to grant it a DEA number, and to “provide it with all regulatory services necessary to allow the importation and dispensing of ayahuasca to its congregation.”
But the DEA, as usual, is a hard nut to crack. It has a policy of denying regulatory services to visionary churches and refusing all requested religious exemptions from the CSA until and unless compelled by court order—which has happened separately with two Brazilian churches using ayahuasca, according to the complaint.
The DEA doesn’t seem interested in working with churches for the specific needs of religious ceremonies. It has guidance for such a thing, but there are legal trapdoors in it for the organizations who go through that guidance, the AYA/NAAVC lawyers allege.
DEA’s reports to oversight agencies show no staffing expenditures for employees to consider the needs of churches and religious persons seeking exemptions from the CSA on religious grounds. DEA has no individuals uniquely tasked with evaluating requests for exemptions from the CSA on religious grounds, the complaint noted.
NAAVC and AYA attorneys tried using the first amendment and American history, citing that “diversity of religion gave fertile soil to an attitude of tolerance that, aided by the effort of principled advocates within the religious and legal communities, ripened into the commitment to universal religious freedom that the nation now embraces,” adding that “religious expression, like secular expression, is accorded the highest level of Constitutional protection.”
When DHS seized their ayahuasca shipments, it caused the parties to “suffer the seizure of sacramental ayahuasca destined for sharing with congregations in free exercise of their right to practice visionary communion in sacred ceremony,” the complaint stated. “The dangers of seizures of the sacrament, invasion of religious services, and arrest of church leaders and congregants are clear and present dangers to the visionary church community,” according to the complaint as outlined in court documents.
What really happened, they explained, was classic enforcement overreach by the DEA against churches entitled to exemption. After all, ayahuasca is an herbal preparation that is not listed as a drug of abuse in the 2020 DEA resource guide “Drugs of Abuse.”
The church’s complaint reminded both parties that the courts have recognized that ayahuasca is almost exclusively consumed in religious ceremonies. “Visionary churches whose sacrament is ayahuasca are using a sacrament that in itself affirms their claim of religious sincerity. The very activity of drinking ayahuasca confirms their religious intent, because it is a demanding visionary experience that delivers rewards commensurate with sincerity.”
Plus, as the churchs’ lawyers pointed out, the DEA had a peyote regulatory system that was devised exclusively for the benefit of the Native American Church (NAC). The DEA established the peyote regulatory system pursuant to statutory authorization. Why not ayahuasca?
The DEA regulatory regime covers the distribution of peyote from its sole point of origin in Texas, where “peyoteros” registered with the DEA collect the sacred cactus and may lawfully deliver it to any Native American who presents a “Certificate of Indian Blood.”
Neither the Native American Church nor its branch churches register with the DEA, and the last DEA registrant to handle a peyote button in the supply chain is the DEA-licensed peyotero. The NAC and its congregants are not subject to DEA registration or any other regulatory requirements.
So is the DEA saying: Peyote good, ayahuasca bad?
Bottom line: Without ayahuasca, AYA does not have a religious practice to share, and AYA congregants are unable to practice their religion, the complaint stated. The CSA effectively coerces the AYA and NAAVC to act contrary to their religious beliefs by the threat of criminal sanctions. The complaint added that the potential for prosecution under the CSA “places substantial pressure on AYA, its founder, and the congregation to modify their behavior and violate their beliefs, forcing them to choose between either abandoning religious principle or risking criminal prosecution.”
But later, as an amended complaint made its way through the district court of the Northern District of California, then got transferred to the District of Arizona, Senior District Judge Roslyn Silver dismissed most of the claims brought against federal and local law enforcement by religious organizations that use ayahuasca in their ceremonies, finding among other things that the plaintiffs haven’t suffered a legal wrong necessary for their Administrative Procedure Act (APA) claim. The APA outlines rulemaking procedures, addresses other agency actions such as issuance of policy statements, licenses, and permits, and provides standards for judicial review if a person has been adversely affected or aggrieved by an agency action.
Additionally, the DEA guidance issue became a sort of deal-breaker. Judge Silver found that the DEA guidance does not require the churches to do anything, or prevent them from doing anything, and therefore has not caused an actual or imminent injury. That’s not what the AYA/NAAVC lawyers thought in their original complaint filing. “The DEA’s use of the guidance as a ruse to present the appearance of a legitimate path for visionary churches to obtain regulatory services was an act of conscious indifference that caused compensable injury to the civil rights of plaintiffs.”
The DEA claims the churches lost their case due to procedural error on the part of the churches; the churches say that the DEA is sidestepping its role in regulating and managing the use of ayahuasca in religious ceremonies, and appears to be holding onto obstacles for any U.S. church to legally use ayahuasca.
This case helps illustrate, once again, that reforms are needed at the DEA to handle psychedelics, as they work through clinical trials, get regulatory help from the FDA, and continue to be a legal part of certain indigenous religious ceremonies dating back hundreds if not thousands of years.
It may take some time. In fact, right now, the DEA is blocking access to psilocybin for terminal cancer patients, and advocates are planning protests May 9 at the DEA headquarters in Washington, D.C., citing the Right to Try Act that allows terminally ill patients to seek drug treatments.
When you see various agencies of the U.S. government getting involved in psychedelics, or changing their stance even a little (such as the DEA), that signals that the industry has hit its stride.
Avenues of development open up, investor confidence increases, and researchers sense the ability to achieve goals that not only science but government supports. It begins to feel like everyone is on the same page.
Here’s a look at what various government agencies are doing about psychedelics:
– DEA. The Drug Enforcement Administration seems to want to help the psychedelics industry more than ever, but can’t help adding caveats about what that progress looks like. For example, the DEA reported in the Federal Registry on October 18, 2021 that there has been a significant increase in the use of schedule I hallucinogenic controlled substances for research and clinical trial purposes (MDMA and psilocybin chief among them), and that it has approved new applications for schedule I research registrations and new applications for registration from manufacturers and corresponding quota applications to grow, synthesize, extract, and manufacture dosage forms containing specific schedule I hallucinogenic substances for clinical trial purposes. The DEA also reported that it supports increased production quotas proposed for 2022 compared with production quotas for these substances in 2021. That’s good news for the industry—followed by more bad news. On January 14, 2022, the DEA proposed placing five tryptamine hallucinogens(4-OH-DiPT, 5-MeO-AMT, 5-MeO-MiPT, 5-MeO-DET, and DiP) on schedule I of the Controlled Substances Act. If finalized, this action would impose the regulatory controls and administrative, civil, and criminal sanctions applicable to schedule I controlled substances on anyone who handles (manufacture, distribute, reverse distribute, import, export, engage in research, conduct instructional activities or chemical analysis with, or possess), or proposes to handle these five specific controlled substances. That could be a problem for Field Trip, a psychedelics therapy company. “Field Trip’s FT-104 is a prodrug of 4-OH-DiPT, so this will add some paperwork and delays to their efforts in the U.S.,” Matt Baggott, co-founder and CEO of Tactogen, a pharmatech company, wrote in a tweet about the DEA news. “It’s worth noting that HHS provided DEA with an analysis of these compounds in 2012 and DEA failed to act until now. This raises the question of whether this scheduling is in response to the increased interest in psychedelic medicine.”
– FDA. Probably the most active government psychedelics supporter is the Food and Drug Administration because of the critical role it plays in assessing any drug that wants to be FDA-approved and sold to the public. The agency has picked up the pace in its work with psychedelics. But it is still charged with an exceptional sense of prudence when working to legitimize novel compounds. In a commentary published in the American Journal of Medicine in January, Attorney Matt Lamkin, associate professor at the University of Tulsa College of Law, discussed the role of the FDA as research into psychedelics explodes. “Incorporating psychedelic drugs into clinical practice will require peeling back multiple layers of legal prohibition, clarifying prescribing guidelines, and developing treatment models that work for drug makers, physicians, and payers.” He went on to cite various achievements of the FDA and psychedelics: granting breakthrough therapy status to expedite the development and review of multiple psychedelic drugs; approval in 2019 of esketamine as a therapy for treatment-resistant depression; the promising results from an FDA-approved phase 2 trial of psilocybin as a treatment for major depressive disorder; and in June, when researchers published results from a phase 3 trial—the final phase before seeking FDA approval—studying 3,4-methyl-enedioxymethamphetamine (MDMA) as a treatment for posttraumatic stress disorder. Still, Lamkin was cautious about how and what the FDA could do. “Although the psychedelic research revival is yielding promising results, challenges remain before these drugs will find their way into clinical practice. Yet this plodding process could enhance the likelihood that these therapies will actually take root,” Lamkin wrote. “Given the longstanding skepticism toward psychedelic interventions, moving too swiftly might risk a backlash that could further stall research. Proceeding both with caution and openness offers the best hope for harnessing the potential benefits of these drugs while mitigating their risks.”
– NAS. The National Academies of Science, Engineering and Medicine is focusing more attention on the psychedelics arena. For example, on March 29, the NAS will be conducting a workshop exploring psychedelics and entactogens as treatments for psychiatric disorders. The NAS noted on its website about the workshop that, with activity and interest in this field continuing to grow, the workshop “will provide a venue to explore strategies for harnessing the potential of these agents to combat mental illness.” Invited speakers will discuss the neurobiology of the therapeutic effects, strategies for optimizing the safety, efficacy, and patient stratification, and lessons learned that may help the identification of new classes of therapeutic agents. The workshop will explore the unique challenges and considerations presented by compounds that induce profound changes in consciousness, including those related to clinical trial design, medical ethics, and the psychosocial contexts of drug administration. The workshop is sponsored by the Department of Health and Human Services and the National Science Foundation.
– NIH. The National Institutes of Health discussed psychedelics favorably at the National Institutes of Health’s FY22 Budget and the State of Medical Research hearing before the Subcommittee on Labor, Health and Human Services Education and Related Agencies on May 26, 2021. “I think as we’ve learned more about how the brain works we began to realize that these are potential tools for research purposes and might be clinically beneficial,” Francis Collins, director of the NIH said, referring to psychedelics such as psilocybin and MDMA. Collins said there has been a resurgence of interest in psychedelic drugs, which for a while “were sort of considered not an area that researchers legitimately ought to go after.” Additionally, on October 20, 2021, Johns Hopkins Medicine announced that the National Institute on Drug Abuse (NIDA) within the NIH, had awarded a grant of $4 million to fund a study using psilocybin as a therapeutic agent for smoking cessation. It is the first grant awarded by the United States government for research on psilocybin for tobacco use in 50 years. The multi-site, three-year study will be led by researchers with Johns Hopkins Medicine in collaboration with researchers at the University of Alabama at Birmingham.
– NSF. The National Science Foundation is stepping up its support of psychedelics studies. One example is a study on how psilocybin and LSD work on brain activity, funded in part by an NSF grant for a six year study of various interdisciplinary training elements for complex networks and systems.
–USDA. The U.S. Department of Agriculture is on the lookout for ketamine. According to a Consumer Reports analysis of data from the Food Safety and Inspection Service, a branch of the U.S. Department of Agriculture, trace amounts of ketamine may have appeared in the U.S. meat supply more often than was previously known, pointing to new testing technologies that can better show what’s in meat today. The data for Consumer Report’s assertion came from the USDA’s Food Safety and Inspection Service (FSIS), the agency responsible for ensuring the safety of the U.S. meat supply. Emilio Esteban, chief scientist for the FSIS, said that the results should be discounted because they came from unconfirmed screening tests. “These results are credible enough that you would expect the government to take the warning signs seriously,” says James E. Rogers, Ph.D., who was a microbiologist at the FSIS for 13 years before becoming director of food safety research and testing at Consumer Reports. “You would hope the results would prompt the agency to look into why these drugs may be present, what risks they could pose, and what could be done to protect consumers.”
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