DEA Letter to Georgia Board of Pharmacy Raises Novel Legal Issues

[Note from the editor: This article is about a letter that the DEA sent to the GA Board of Pharmacy that I wrote for the American Journal of Endocannabinoid Medicine. It is reprinted here with permission. You can read the article in its original form by clicking here.]

On November 27, 2023, the Drug Enforcement Administration (DEA) issued a warning letter to the Georgia Board of Pharmacy (GBP) stating:

“All DEA registrants, including DEA-registered pharmacies, are required to abide by all relevant federal laws and regulations. A DEA-registered pharmacy may only dispense controlled substances in Schedules II-V of the Controlled Substances Act. Neither marijuana nor THC can lawfully be possessed, handled, or dispensed by any DEA-registered pharmacy.”

The letter was a response to regulations regarding Georgia’s medical marijuana program (MMP) approved by Governor Brian Kemp in September 2023.¹ Approval of the regulations was the final step for pharmacies to start dispensing marijuana to registered patients in the state. In this article, I discuss the novel legal issues raised by the DEA’s letter and the likely outcome of a legal dispute. 

Background

Georgia passed a law legalizing medical marijuana in 2019. The law called “Georgia’s Hope Act,” authorizes the oversight of the regulated licensing of limited in-state cultivation, production, manufacturing, and sale of “low THC oil” to registered patients by the Georgia Access to Medical Cannabis Commission. Under Georgia law,² “low THC oil” means “an oil that contains not more than 5 percent by weight of tetrahydrocannabinol (THC) and an amount of cannabinol (CBN) equal to or greater than the amount of THC.” As an aside, because CBN is primarily a product of degraded THC not found in substantial quantities in the cannabis plant, it is likely the legislature intended to require an “equal or greater amount” of cannabidiol (CBD) rather than CBN, and this was overlooked in the final version of the law. Whether this apparent typo will raise legal issues regarding the formulation of compliant low THC oil in the future is unknown. A registered patient may possess up to 20 ounces of low THC oil. 

As described by the Georgia Department of Public Health (DPH) on its patient registry website,³ the state’s MMP is limited, only allowing registered patients to avoid criminal prosecution if they possess no more than the allowed amount of low THC oil. The MMP does not extend to marijuana, infused foods, or products for inhalation. 

Georgia’s MMP is unique in that it authorizes pharmacies to dispense low THC oil. No other state authorizes pharmacies to dispense marijuana. Despite the MMP’s limited scope, many pharmacies in the state have been eager to start dispensing low THC oil to patients. As reported by PBS News Hour,⁴ “Andrew Turnage, executive director for the Georgia Access to Medical Cannabis Commission, said the pharmacy rule is ‘definitely big news that helps both our licensees and especially our patients[.] It will put access in virtually every county in the state’.” 

Novel Legal Issue

Given that Georgia is the only state that allows pharmacies to dispense medical marijuana, the DEA’s letter to the GBP is unprecedented. It also raises novel legal issues. Pharmacies must register with the DEA and the state(s) they operate in to dispense controlled substances. As stated in the letter from the DEA to the GBP, a DEA-registered pharmacy may not dispense substances listed in Schedule I of the Controlled Substances Act (CSA). Marijuana and THC are both listed in Schedule I. In the case of Georgia’s MMP, pharmacies are in a legal conundrum. The GBP specifically authorizes them to dispense a Schedule I controlled substance, low THC oil; however, they are specifically prohibited from doing so by the DEA. In other words, a state-licensed pharmacy that dispenses low THC oil in accordance with Georgia law but in violation of federal law is compliant with 1 of the 2 sovereign government entities under which it is licensed (ie, Georgia), but is noncompliant with the other government body (ie, the United States). What is the likely outcome if a pharmacy proceeds to dispense low THC oil despite the DEA’s warning?

Analysis

It may be surprising to hear that the DEA has a weaker legal position. First and most importantly, a provision in federal law known as the Rohrabacher-Farr Amendment⁵ prohibits the Department of Justice (DOJ) from spending funds to interfere with the implementation of state medical cannabis laws. Federal courts have ruled that the Amendment prevents the DOJ, which includes the DEA, from prosecuting individuals for marijuana crimes when their actions are compliant with their state’s medical marijuana laws. (The Amendment’s protections do not extend to participants in adult-use, sometimes referred to as “recreational,” state marijuana programs.) For this reason, it is unlikely a Georgia pharmacist who dispenses low THC oil in compliance with the state’s MMP could be prosecuted. However, this does not conclude our legal inquiry, which questions whether the DEA can revoke a pharmacy’s federal license to dispense controlled substances based on dispensing low THC oil. Although this is an untested legal issue due to Georgia’s MMP being unique, the amendment’s broad language seems to preclude the DEA from revoking a Georgia pharmacy’s registration under these circumstances, as doing so would require it to spend funds. 

The DEA has a weaker legal position because federal law does not appear to authorize it to revoke a pharmacy’s registration in these circumstances, regardless of the Amendment. Under 21 USC §824(a),⁶ the DEA may deny, revoke, or suspend a pharmacy registration upon a finding that the registrant:

1. has materially falsified any application filed pursuant to or required by this subchapter or subchapter II;
2. has been convicted of a felony under this subchapter or subchapter II or any other law of the United States, or of any State, relating to any substance defined in this subchapter as a controlled substance or a list I chemical;
3. has had his State license or registration suspended, revoked, or denied by competent State authority and is no longer authorized by State law to engage in the manufacturing, distribution, or dispensing of controlled substances or list I chemicals or has had the suspension, revocation, or denial of his registration recommended by competent State authority;
4. has committed such acts as would render his registration under section 823 of this title inconsistent with the public interest as determined under such section; or
5. has been excluded (or directed to be excluded) from participation in a program pursuant to section 1320a–7(a) of title 42.

The only provision that appears to apply to these circumstances is subsection 4, which requires a finding that the pharmacy has committed acts that would render registration “inconsistent with the public interest.” Absent specific authorization by the state of Georgia, the DEA could easily find that a pharmacy that dispensed marijuana or THC without authorization acted inconsistently with the public interest as doing so is a violation of federal law. However, given that Georgia authorizes this activity, it would be difficult for the DEA to carry its burden to find the pharmacy’s actions inconsistent with the public interest because the state of Georgia has specifically found that dispensing low THC oil is in the public interest. If the Amendment remains in effect, we will not likely see this second legal issue litigated. The Amendment comes up for renewal in February 2024. If it is not renewed, an admittedly unlikely outcome because it has been renewed for many consecutive years, this issue may arise. If so, I anticipate that Georgia pharmacies will prevail. 

Conclusion

The DEA’s warning to the GBP about Georgia’s limited but unique MMP raises novel legal issues. Fortunately, the GBP and its authorized pharmacies currently have the upper hand as the DEA is not permitted to spend any funds to interfere with a state’s medical marijuana program. Additionally, and notwithstanding the Amendment, the findings required to revoke a pharmacy’s license to dispense controlled drugs would be difficult to prove when a pharmacy acts in accordance with state law. 

References:

1. Rules and Regulations of the State of Georgia. Chapter 480-52: Retail pharmacy requirements for dispensing low-THC products. Accessed January 14, 2024. https://rules.sos.ga.gov/gac/480-52
2. Rules and Regulations of the State of Georgia. Chapter 360-36: Low THC oil. Accessed January 14, 2024. https://rules.sos.ga.gov/gac/360-36#:~:text=’Low%20THC%20oil’%20means%20an,than%20the%20amount%20of%20tetrahydrocannabinol.&text=’Physician’%20means%20an%20individual%20licensed,Chapter%2034%20of%20Title%2043
3. Georgia Department of Public Health. Low THC oil registry. Accessed January 14, 2024. https://dph.georgia.gov/low-thc-oil-registry
4. PBS News Hour. Georgia will be 1st state to allow pharmacies to sell medical marijuana. Accessed January 14, 2024. https://www.pbs.org/newshour/nation/georgia-will-be-1st-state-to-allow-pharmacies-to-sell-medical-marijuana
5. MJBizDaily. Judge invokes Rohrabacher-Farr in federal marijuana case. Published December 17, 202. Accessed January 16, 2024. https://mjbizdaily.com/district-judge-invokes-rohrabacher-farr-federal-cannabis-case/
6. §824. Denial, revocation, or suspension of registration. Accessed January 14, 2024. https://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title21-section824&num=0&edition=prelim

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January 19, 2024

Rod Kight is an international cannabis lawyer. He represents businesses throughout the cannabis industry. Additionally, Rod speaks at cannabis conferences, drafts and presents legislation to foreign governments, is regularly quoted on cannabis matters in the media, and is the editor of the Kight on Cannabis legal blog, which discusses legal issues affecting the cannabis industry. You can contact him by clicking here.