DEA Excluded MMJ, Only FDA-Pathway Developer with $10M in Research, from Rescheduling Hearing

When an agency excludes the party with the most directly relevant evidence from its own rulemaking proceeding, it invites a court to later find that the record is incomplete—and to set aside the resulting rule. That is precisely the scenario MMJ International Holdings claims is unfolding as the DEA presses forward with marijuana rescheduling without hearing from the only company actively pursuing a botanical cannabinoid drug through the FDA’s rigorous approval pathway. For regulatory lawyers, the case is a textbook example of how administrative convenience can collide with the fundamental requirement that agencies consider all relevant factors before making a final decision.

The U.S. Drug Enforcement Administration’s process to consider rescheduling marijuana under the Controlled Substances Act took a contentious turn when it excluded MMJ International Holdings from its administrative law judge (ALJ) hearing. According to a company press release, MMJ is the only entity developing botanical cannabinoid medicines through the Food and Drug Administration’s formal drug approval pathway—a detail that goes to the very heart of the legal question at issue: whether marijuana has a ‘currently accepted medical use.’ By shutting MMJ out, the DEA arguably deprived its own rulemaking record of the most directly relevant scientific and regulatory evidence, raising serious concerns under the Administrative Procedure Act and principles of due process.

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Drug Enforcement Administration’s process to consider rescheduling marijuana under the Controlled Substances Act took a contentious turn when it excluded MMJ International Holdings from its administrative law judge (ALJ) hearing.

MMJ’s story is one that would seem tailor-made for the hearing. Over nearly eight years, the company secured DEA registrations, pursued FDA Investigational New Drug applications, developed standardized botanical soft-gel capsules under pharmaceutical manufacturing standards, generated chemistry, manufacturing and controls (CMC) data, completed stability testing, and invested more than $10 million. These are precisely the types of evidence that federal law contemplates when determining ‘currently accepted medical use’—reproducible chemistry, standardized dosing, adequate safety data, physician oversight, and reliable clinical trials. Yet when MMJ sought to present this body of work, the DEA deemed the issues to be ‘questions of law’ and excluded the company, effectively sidelining the one party that had done what Congress envisioned for controlled-substance medicines.

The agency’s reliance on its 1999 order rescheduling dronabinol—a synthetic THC formulation in soft gelatin capsules—as precedent is equally perplexing. The 1999 order addressed a single, FDA-approved synthetic cannabinoid. Here, MMJ is pursuing the same FDA approval pathway for a botanical cannabinoid product, not merely a synthetic isolate. The two are legally and scientifically distinct, and the DEA’s failure to recognize this distinction may signal an overly narrow interpretation of its own precedent, one that could be vulnerable on judicial review. In fact, the press release asserts that the hearing witness debates covered precisely the topics MMJ had addressed through its FDA work, reinforcing the argument that the DEA’s decision to exclude was arbitrary and capricious.