DEA Rescheduling Paves Way for Pharma and Biotech


The impending DEA rescheduling of marijuana to a Schedule III controlled substance presents a momentous opportunity for everyone in the industry. Cannabis processing labs would especially benefit, according to Prodigy Processing Solutions (PPS).

Cannabis processing labs extract and purify oil from the cannabis plant to produce consumable goods containing THC, CBD and a variety of other cannabinoids. Due to federal illegality, these operations have been limited to recreational or medicinal cannabis production and geographically confined to individual states or have operated as resource-intensive multi-state operators (MSOs).

The rescheduling of marijuana would allow labs to diversify revenue streams, exponentially increase profits and expand their geographic reach worldwide.

Opportunities for Cannabis Research

PPS states that under Schedule III, cannabis-derived compounds will be federally legal as active ingredients in prescription medications. By pivoting towards pharmaceutical and biotech research and development, cannabis labs can unlock numerous lucrative possibilities for contract research and manufacturing with nationwide and international distribution.

The funding for this additional research can come from the pharmaceutical sector, which boasts significantly higher profit margins compared to traditional cannabis markets. Its gross profit margins average 77% and net income margins around 14%, according to PPS. Pharmaceutical companies offer a lucrative landscape for cannabis processors to grow.

How Labs Can Prepare for Rescheduling

To capitalize on this groundbreaking opportunity, PPS suggests that state-licensed cannabis labs will need to upgrade their operations to meet FDA GMP (Good Manufacturing Practices) standards, obtain DEA registration and comply with additional regulatory guidelines.

Marc Beginin, CEO of PPS, emphasizes the transformative potential of this shift, stating, “By aligning with FDA regulations under Schedule III, cannabis processors can harness their expertise to drive innovation in pharmaceutical and biotech R&D, positioning themselves at the forefront of a growing industry.”

As the global pharmaceutical contract manufacturing market is projected to grow from $172 billion in 2023 to $330 billion by 2033, North American cannabis processors have a unique opportunity to capitalize on this trend. Prodigy empowers cannabis processors to embrace this paradigm shift and seize the vast opportunities that lie ahead.

“Our ASME and PSI certified extraction systems utilize only 316L pharmaceutical-grade stainless steel and are fully compliant with FDA cGMP and EU GMP standards,” continued Beginin. “Made in the USA, Prodigy’s systems are customizable to meet specific production needs while ensuring a smooth transition to pharmaceutical-grade production.”

In addition to its advanced extraction technology, Prodigy offers a comprehensive suite of ancillary equipment and services, including architecture, MEP design/build, product SOPs, certified extraction training and GMP integration for food and pharmaceutical compliance worldwide, the company states.

With Prodigy Processing Solutions leading the charge towards pharmaceutical-grade standards, the future of cannabis processing is set for unprecedented growth and transformation under Schedule III.