Executive and DOJ Orders Accelerate Support for Psychedelic Therapies and Medical Marijuana

Pharmaceutical industry stakeholders should take note of recent actions by the Trump administration that signal looser federal restrictions on substances such as psychedelics and marijuana.

The president’s April 18, 2026, executive order could speed approvals and open new funding opportunities for psychedelic research into therapies for patients with serious mental illness.

The DOJ’s subsequent final order rescheduling FDA-approved marijuana drug products and state-licensed medical marijuana from Schedule I to Schedule III of the Controlled Substances Act of 1970 (CSA) eases taxes and federal registration burdens for operators.

Taken together, these measures signal potential willingness to reduce barriers to alternative drug therapies, with wide-ranging implications for pharmaceutical companies, healthcare investors and state regulators.

Current Regulatory Status

Federal drug policy historically placed tight restrictions on psychedelics and marijuana. Under the CSA, most psychedelics are classified as Schedule I substances, a designation reserved for drugs deemed to have a high potential for abuse with no currently accepted medical use for treatment in the United States. This classification placed psychedelics such as psilocybin alongside substances such as heroin and LSD, inhibiting clinical research into their potential therapeutic applications.

Similarly, marijuana has remained a Schedule I substance under federal law despite a growing number of states legalizing or decriminalizing it for both medical and recreational use. In recent years, renewed interest in studying the potential benefits of certain psychedelics such as psilocybin in treating mental health disorders prompted the FDA in June 2023 to issue its first draft guidance for researchers investigating psychedelic substances as potential treatments, acknowledging these drugs’ potential therapeutic value while noting their potential for abuse.

Executive Order on Psychedelic Therapies

• The executive order directs the FDA commissioner to make the National Priority Voucher program applicable to psychedelic drugs that have received Breakthrough Therapy designations for treating serious mental illnesses.
• The order further directs the FDA and the DEA to establish a pathway for eligible patients to access investigational psychedelic drugs including ibogaine compounds under the Right to Try Act. Notably, this includes any necessary Schedule I handling authorizations for treating physicians and researchers. The Right to Try Act, originally signed into law in 2018, provides terminally ill patients with a pathway to access potentially lifesaving treatments even if those treatments are still undergoing FDA review.
• The order also requires the secretary of Health and Human Services (HHS) to allocate at least $50 million through the Advanced Research Projects Agency for Health (ARPA-H) to support and partner with state governments that enacted or are developing programs to advance psychedelic drugs for serious mental illness, including through federal funding, technical assistance and data sharing.
• In addition, HHS and the FDA are directed to collaborate with the Department of Veterans Affairs and the private sector to increase clinical trial participation and evidence generation surrounding experimental psychedelic therapies, with priority given to drugs that have received Breakthrough Therapy designations. The agencies are also directed to enter data-sharing agreements to help the FDA evaluate and approve these therapies more efficiently.
• The order also directs the attorney general to initiate and complete reviews of products containing a Schedule I substance that successfully completed Phase 3 clinical trials for a serious mental health disorder so that rescheduling can promptly proceed for products that receive FDA approval.

DOJ Final Order on State-Legal Medical Marijuana

In a separate but related development, the DOJ published a final order rescheduling certain categories of marijuana from Schedule I to Schedule III of the CSA. The order covers FDA-approved drug products containing marijuana and state-licensed medical marijuana products. Importantly, all other marijuana, including recreational marijuana, unlicensed bulk marijuana and synthetic THC, remains a Schedule I controlled substance.

The order is notable because the reclassification did not go through typical notice-and-comment rulemaking processes. Instead, the DOJ relied on the attorney general’s authority to schedule substances required to be controlled under international treaty obligations, which permits an expedited process.

For state-licensed medical marijuana operators, the order has several practical consequences.

• State medical marijuana licenses will no longer face the deduction disallowance under Section 280E of the Internal Revenue Code, which limits deductions for businesses involved in trafficking Schedule I or II substances. The order also encourages the Treasury Department to consider providing retroactive relief for prior tax years.
• The order creates a streamlined registration pathway for state-licensed medical marijuana operators. Entities with valid state licenses can use those credentials to satisfy the federal registration requirements, and the DEA must grant registrations unless doing so would conflict with public interest considerations or treaty obligations. Applicants that apply within 60 days of the order’s publication may continue to operate under their state licenses while their federal applications are pending, which should be processed within six months.
• The order reduces duplicative compliance burdens by allowing state-licensed entities to rely on their existing state recordkeeping, labeling, packaging and security requirements in place of federal ones, subject to certain conditions. It also provides a safe harbor for researchers who obtain marijuana from state-licensed sources for use in federally registered research programs.

Practical Implications for Stakeholders

Both the executive order on psychedelics and the DOJ final order on medical marijuana create several practical considerations for industry participants.

• Pharmaceutical companies developing psychedelic therapies should evaluate their clinical pipelines for eligibility under the Breakthrough Therapy and National Priority Voucher frameworks, as these designations may significantly accelerate regulatory timelines.
• Organizations engaged in psychedelic research or commercial product development should assess how the $50 million ARPA-H allocation and state-matching requirement may create new funding pathways.
• Healthcare organizations and clinician groups may want to consider integrating evolving clinical evidence into research protocols and patient counseling, especially for treatment-resistant mental health conditions.
• Companies operating in the medical and recreational cannabis space should evaluate how the DOJ final order may affect their compliance obligations.

Related Insights

These developments are part of a broader trend in which the federal government is moving toward fewer restrictions on drug products that have shown therapeutic promise. McGuireWoods is tracking these developments closely. For additional background and analysis, see our prior alerts: Interest in Psilocybin Continues to “Mushroom” for Potential Mental Health Treatment, which examines the evolving landscape for psilocybin at both the federal and state levels, including FDA clinical trial guidance and state programs in Oregon and Colorado; and What Trump’s Executive Order to Reschedule Marijuana and CBD Means for the Cannabis Industry, which analyzes the December 2025 executive order on marijuana and CBD rescheduling and the practical implications of that order for the broader cannabis industry.

McGuireWoods is closely monitoring the implementation of both the executive order and the DOJ final order, as well as related agency actions. To learn more about how these developments may affect your business, contact the authors or a member of the Healthcare & Life Sciences Industry Team.