WASHINGTON, April 22 (Reuters) – The U.S. government is expected to reclassify marijuana as early as Wednesday, sending stocks of U.S. cannabis-related companies higher, Axios reported, citing an official familiar with the matter.
The decision to reclassify marijuana would be one of the most significant changes to federal marijuana policy in decades, removing a barrier to research into potential use cases for the drug.
In December, U.S. President Donald Trump signed an executive order directing the relaxation of federal regulations on marijuana, paving the way for the reclassification.
The move could result in the psychoactive plant being classified as a less dangerous drug along with common painkillers, ketamine and testosterone.
It could also reshape the cannabis industry by lowering the tax burden and making it easier for companies to access capital, benefiting Canopy Growth, Tilray Brands, Trulieve Cannabis and others.
After the release of the Axios report, shares of Canopy, which is listed in the United States, soared 23% and Tilray shares rose 15%.
The Justice Department and its Drug Enforcement Administration did not immediately respond to requests for comment. Decisions to reclassify marijuana are made by the DEA.
Marijuana is the most widely used illicit drug in the world and in the United States. Nearly one in five U.S. residents uses it annually, according to the Centers for Disease Control and Prevention, Reuters reported in December.
(Reporting by Bhargav Acharya and Daphne Psaledakis, additional reporting by Padmanabhan Ananthan; Editing by Caitlin Webber)