The United States administration is expected to move to reclassify marijuana as soon as Wednesday, Axios reported, citing an official familiar with the matter, sending US stocks of cannabis-related companies higher.
The decision to reclassify marijuana would represent one of the most significant federal changes to marijuana policy in decades, removing barriers to researching the drug's potential use cases. In December, US President Donald Trump signed an executive order directing the loosening of federal regulations on marijuana, paving the way for reclassification.
The move could lead to the psychoactive plant being listed alongside common painkillers, ketamine and testosterone as a less dangerous drug.
It would also likely reshape the cannabis industry by lowering tax burdens and make it easier for companies to secure funding, benefiting firms like Canopy Growth, Tilray Brands, Trulieve Cannabis.
US-listed shares of Canopy surged 23 per cent while Tilray rose 15 per cent following the Axios report.
The Justice Department and its Drug Enforcement Administration did not immediately respond to requests for a comment. The decision to reclassify marijuana rests with the DEA.
Marijuana is the most widely used illicit drug in the world and the United States. Nearly one in five US residents use it a year, according to the US Centers for Disease Control and Prevention, Reuters reported in December.