DEA Registers Over 900 Medical Marijuana Shops in Seven States

The U.S. Drug Enforcement Administration issued its first federal registrations to medical marijuana dispensaries on Friday. The agency approved more than 900 state-licensed shops in Alabama, Florida, Mississippi, South Dakota, Texas, Virginia, and West Virginia, according to a Justice Department release.

This move follows an order signed by Attorney General Todd Blanche in April. That order shifted state-licensed medical marijuana from Schedule I to Schedule III. Schedule I is reserved for drugs with high abuse potential and no accepted medical use, such as heroin. Schedule III carries less strict regulatory controls.

The registration process legitimizes the industry in the 40 states with medical marijuana programs. It also opens the door for major tax relief. For years, these businesses could not deduct ordinary expenses like rent, labor, or advertising on federal returns because the drug was federally illegal. Industry leaders have described this tax structure as financially damaging.

Blanche stated that regulated distribution from these shops will ensure broader access to chronic pain treatment and improve public safety. The department did not identify the specific businesses in the initial release.

Nearly 7,000 other cannabis producers, manufacturers, and distributors have applied for registration, the DEA said. Applicants must complete a pre-registration investigation and implement security, recordkeeping, and inventory controls for handling controlled substances.

Steph Sherer, founder of Americans for Safe Access, called the approvals a victory for patient access. She noted that the registrations were issued just days before the 30th anniversary of California legalizing medical marijuana. Sherer said the federal government is finally recognizing the dispensaries that patients established over the last three decades.

Uncertainties remain regarding how the DEA will regulate these businesses. State laws often allow operators with some criminal history to run licensed shops, a practice aimed at mitigating the drug war. It is unclear if the federal agency will adopt that approach. Additionally, many states have merged recreational and medical markets. The administration has sought to reschedule marijuana more broadly, but it is not yet clear how the DEA will treat businesses handling both adult-use and medical cannabis.

Chris Lindsey, vice president of policy at the American Trade Association for Cannabis and Hemp, described the progress as a positive step. He said the industry is now watching to see what operational requirements the registered companies must follow.