BREAKING: Tilray stock jumps as White House moves to seek Schedule III for marijuana
Tilray stock is on the move after a policy jolt out of Washington. I can report the White House is preparing to seek the reclassification of marijuana from Schedule I to Schedule III under federal law. That step would mark the biggest federal shift on cannabis in half a century. It is already rippling through markets and into boardrooms today.
Tilray Brands, trading on the Nasdaq as TLRY, has swung sharply intraday. Shares recently traded near 10.88, up about 2 percent, after surging far higher in the premarket. The stock touched an intraday high above 12. The rally follows heavy buying across the cannabis sector as investors weighed what Schedule III could mean for taxes, banking, and research.
What Schedule III actually changes
Under the Controlled Substances Act, marijuana is now in Schedule I, the strictest category. Moving it to Schedule III would not legalize adult-use at the federal level. It would, however, unwind the most punishing barriers that have strangled legal operators for years.
- Section 280E relief, normal business deductions would return for state-legal operators
- Banking access, more lenders and card networks could engage with clearer federal cover
- Research and pharma pathways, FDA-regulated development could expand
- Compliance costs, lower risk premiums and insurance hurdles could ease
Ending 280E is the single biggest financial change. It can turn thin margins into real profits for compliant firms.
For citizens, Schedule III would not create a national right to possess or use cannabis. State laws would still control access. Possession policies, expungement, and record relief remain matters for Congress and the states unless the administration pairs this move with broader criminal justice actions.
Rescheduling is not federal legalization. State rules still govern who can grow, sell, and buy, and where.
Why Tilray is reacting now
This is a policy driven rally, not a meme spike. Tilray is one of the best known cross border cannabis and consumer brands, already listed on a major U.S. exchange. The company just completed a 1 for 10 reverse split on December 1, which tightened its float and added volatility. It also reported improving results this fall, including revenue above 200 million dollars and a stronger cash position. Today’s news goes to the heart of its U.S. strategy, which relies on clearer federal rules to unlock distribution, finance, and partnerships.
Even with today’s jump, Tilray trades well below its 52 week high near 23. The stock remains highly sensitive to policy headlines. That will not change until rulemaking is final and the tax code impact is settled by the IRS.
The legal path from here
A Schedule III change requires formal rulemaking by the Drug Enforcement Administration. Expect a notice of proposed rulemaking, a public comment period, and a final rule. Health and Human Services analysis supports the scheduling decision, and the Department of Justice must manage enforcement changes and guidance to prosecutors.
None of this is instant. The process could take months. Agencies will also need to update FinCEN guidance to banks and credit unions. That guidance, which today permits cannabis banking with strict reporting, could loosen as federal risk declines. Card networks and major lenders will still assess their own risk policies.
Civic stakes and citizen rights
For workers, safer banking means safer payroll and less cash on site. For patients, expanded research may speed credible dosing, labeling, and access to FDA approved cannabinoids. For small businesses, tax relief can fund compliance, wages, and hiring. For communities, fewer cash based operations can reduce theft risk and improve transparency.
But some big items are not solved by rescheduling alone. Congress would still need to act on expungement, interstate commerce, and broad consumer protections. States keep their licensing power. Tribal sovereignty concerns also remain, and deserve direct consultation.
What this could mean for Tilray’s fundamentals
If Schedule III sticks, Tilray’s U.S. growth math changes fast. Normal deductions would lift margins across retail, processing, and distribution. Lower compliance and finance costs would improve cash flow. Partnerships with pharmaceutical and wellness firms would face fewer federal barriers. Valuation models that assumed 280E forever will need a reset.
Investors should also watch two swing factors. First, the timing and content of the DEA’s final rule. Second, how the IRS applies 280E relief across tax years and entities. These pieces will drive how quickly the gains show up in earnings.
Frequently Asked Questions
Q: Does Schedule III legalize marijuana nationwide?
A: No. It reduces federal controls but does not create a national right to use or sell.
Q: Will 280E taxes go away for cannabis businesses?
A: Yes, for Schedule III substances. Once rescheduled, normal deductions should return, subject to IRS guidance.
Q: Can banks now freely serve cannabis companies?
A: Banking risk should drop, but compliance rules remain. Updated federal guidance will be key.
Q: What happens next in the federal process?
A: DEA proposes a rule, collects comments, then issues a final rule. That can take months.
Q: How does this affect patients and consumers today?
A: State laws still control access. Over time, research and labeling should improve under Schedule III.
Tilray’s surge is a real time verdict on policy, not hype. The market is pricing in a future with normal taxes, safer banking, and science driven development. The law still needs to catch up. Until it does, expect volatility, sharp moves, and a high stakes countdown to the final rule.
