In an interview with conservative radio host Hugh Hewitt on Thursday, Attorney General Jeff Sessions cast doubt on the future of cannabis markets in the growing number of states that have legalized medical or recreational marijuana. "Marijuana is against federal law," Sessions told Hewitt, "and that applies in states where they may have repealed their own anti-marijuana laws."

The statement came in response to a question about the "rule of law," in which Hewitt suggested that "one RICO prosecution against one marijuana retailer in one state that has so-called legalization ends this façade and this flaunting of the Supremacy Clause." RICO is the federal racketeering statute, which has been used to bring cases against gangs and white collar criminals.

Sessions averred that curbing state-legal markets would be "a little more complicated than one RICO case," but he stated plainly, "I'm not in favor of legalization of marijuana. I think it's a more dangerous drug than a lot of people realize." (See also, What Does Weed Cost In Your State?)

The comments have knocked some medical marijuana stocks: GW Pharmaceuticals PLC's (GWPH) shares fell 4.6% from Wednesday's close to 1:00 p.m. EST Friday, while shares in Insys Therapeutics Inc. (INSY) and Cara Therapeutics Inc. (CARA) fell 1.9% and 6.1%, respectively. (See also, Top 4 Medical Marijuana Stocks to Watch for 2017.)

Marijuana is a Schedule I drug under the 1970 Controlled Substances Act, putting it on par with heroin, mescaline, LSD and ecstasy. Federal law views these drugs as having "high potential for abuse" and "no currently accepted medical use." During Thursday's interview Sessions elided marijuana use with the opioid epidemic, which he correctly pointed out was responsible for 120 overdoses per day. There is no documented case of marijuana overdose, although use of the drug has arguably contributed to accidental deaths.

Sessions has been vocal about his fears that the drug isn't being regulated enough. He has called Obama's lax approach "one of his great failures." "We need grown ups in Washington to say marijuana is not the sort of thing to be legalized," he said last year during a Senate Caucus hearing he had convened titled "Is the Department of Justice Adequately Protecting the Public from the Impact of State Recreational Marijuana Legalization?"

 

President Obama's Justice Department ordered its attorneys and law enforcement not to interfere except when the drug was being distributed to minors, its sale was funding illegal activities, it was being transported across state borders or in a few other scenarios that violated federal priorities. These instructions were issued in a memorandum known as the Cole Memo, after former Deputy Attorney General James Cole. (See also: The Marijuana Business: Growing Like a Weed)

During the Senate Committee confirmation hearing, Sessions was asked if he would follow the Cole Memo and he said,  "If I am fortunate enough to be confirmed as Attorney General, I will certainly review and evaluate those policies, including the original justifications for the memorandum, as well as any relevant data and how circumstances may have changed or how they may change in the future."

"I can see Jeff Sessions, an hour after taking the oath, rescinding the Cole Memo. I don’t think he’s necessarily going to do that, but he can. That leaves governors in very difficult places. It does not necessarily create policy change in itself, but what it does is create tremendous uncertainty," said the Brookings Institution's John Hudak in an interview with the Cannabist. A Justice Department spokesman told Politico in early March that the Cole memo continues to guide its policy.

The legal marijuana industry reached $7 billion in sales last year and generated half a billion dollars in sales taxes, according to Reuters. States like Colorado have been able to use this relatively new source of revenue for infrastructure and other expenses. Legal marijuana sales are expected to cross $20 billion in the next three years, according to ArcView Market Research.

 

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