It’s funny how things work out – sometimes you find yourself living in a sort of butterfly effect where the tail seems to wag the dog. In 2023, when we first started writing about the traction psychedelics were gaining as medicine, our goal was not to end up spending years covering the winding legal battle of a Washington physician to legally obtain psilocybin for terminally ill cancer patients to manage their pain. 

But here we are. To be clear, while we’re certainly interested in the fate of Dr. Sunil Aggarwal’s efforts, we’ve been following the case closely because it’s one of a few legal cases to shed light onto what courts and federal agencies may do when faced with a medicinal demand for psychedelics outside of the research context.

In his efforts to be able to administer psilocybin to his patients, Aggarwal employed a two-fold approach: (1) he attacked the status of psilocybin as a Schedule I drug, and (2) he tried to get around statutory requirements governing a physician’s right to distribute Schedule I drugs outside of the research context. Neither has been successful (yet).

DEA Says No to Rescheduling, but the Court Keeps the Door Cracked

As a reminder, here’s what happened when Aggarwal petitioned the DEA to reschedule psilocybin:

Since at least 2021, Dr. Sunil Aggarwal has been working to legally obtain psilocybin for terminally ill cancer patients undergoing end-of-life care. Because psilocybin is a Schedule I drug under the Controlled Substance Act (CSA), obtaining the drug to treat his patients was “practically and legally difficult” according to his lawyers. Aggarwal turned to the DEA, petitioning the agency to transfer psilocybin from Schedule I to Schedule II. The DEA denied the petition in a four-sentence letter. Aggarwal then looked to the Ninth Circuit.

The Ninth Circuit Court of Appeals in  Aggarwal v. U.S. DEA directed the U.S. Drug Enforcement Agency (DEA) to reconsider its decision not to transfer psilocybin from Schedule I to Schedule II. 

The Ninth Circuit sided with Aggarwal. The court held that the “DEA failed to provide sufficient analysis to allow its path to be reasonably discerned” and “failed to clearly indicate that it ha[d] considered the potential problem identified in the petition.” More specifically, the Ninth Circuit noted that the DEA failed to define “currently accepted medical use with severe restrictions,” which was the applicable standard for rescheduling on which Aggarwal relied. The court directed the DEA to clarify or reevaluate its position.

And, while the footsteps may not have been as swift as some would hope, we still stand by the predictions we made in 2023:

The Ninth Circuit’s refusal to accept the DEA’s out-of-hand dismissal of a petition to reschedule psilocybin is yet another step in what appears to be faster and faster footsteps towards the future. What that future holds is yet to be determined – though we will monitor closely – but whatever the future is it promises to be quite a ride.

Will the Right to Try Act Save Practitioners Who Don’t Conduct Research but Want to Administer Schedule I Drugs?

Perhaps realizing that convincing the DEA to reschedule psilocybin may be a tall task, Aggarwal tried his hand before the DEA and then the Ninth Circuit with another approach — trying to get around the Controlled Substance Act (CSA) by way of the Right to Try Act (RTT Act). Aggarwal challenged the DEA’s decision not to exempt him from registration under the CSA, but the FDA’s RTT Act didn’t turn out to be the rescuer he had hoped for.

Because it’s a Schedule I substance, the CSA dictates that psilocybin may only be produced, dispensed, or possessed in the context of a research protocol registered with the DEA and approved by the Secretary of Health and Human Services. In other words, psilocybin may only be dispensed by medical practitioners in the context of “bona fide research,” which requires the approval of the FDA (see21 U.S.C. § 823(g)(2)(A)). The DEA handles registration and “may, by regulation, waive the requirement for registration of certain…distributors, or dispensers if DEA finds it consistent with the public health and safety” (21 U.S.C. § 8222(d)).

The Food, Drug, and Cosmetic Act (FDCA) is even broader and “imposes restrictions on the…distribution of all drugs including but not limited to controlled substances” (21 U.S.C. § 331). Generally, before a new drug can be introduced to the market, it must go through the clinical trial process, but there are other ways. A patient, for instance, may attempt to access a new drug through the FDA’s expanded access program.

Where a prescription drug is a controlled substance, “the FDCA and CSA operate in tandem” and the person distributing the drug must comply with both statutes.

The FDA has also adopted the RTT Act, which is intended to expand access for eligible investigational drugs outside the clinical trail process. “The RTT Act exempts the drugs provided to eligible patients from specified statutory and regulatory requirements concerning drug labeling, marketing, clinical, testing and approval.” “To access an eligible investigational drug under the RTT Act,” an eligible patient’s physician applies directly to the drug’s sponsor, and the FDA is not involved in approving access.

Seeking psilocybin for his terminally ill patients, Aggarwal’s attorneys submitted a letter to the DEA asking the DEA “for authorization to access psilocybin for therapeutic use under state and federal RTT Acts and immunity from prosecution under the CSA.” His lawyers also asked that if it deemed registration was required under the CSA, that the registration requirement be waived.  

The DEA said no dice and clung tight to the CSA. In so doing, the DEA made a few things clear:

• “Practitioners who seek to dispense or possess [S]chedule I controlled substances must be properly registered as an approved researcher in accordance with the CSA and its implementing regulations.”
• The RTT Act does “not provide any exemptions from the CSA or its implementing regulations.”
• The RTT Act does “not give the DEA authority to waive CSA requirements.”

Doubling down, the DEA also declined Aggarwal’s request to initiate rulemaking to exempt him from the CSA’s registration requirement. The DEA provided the following as its reasoning:

• The DEA could not fully assess Aggarwal’s proposal because it was lacking in detail.
• Aggarwal’s desire to administer psilocybin to patients was not consistent with public health and safety. In making this particular finding, the DEA relied heavily on Congress’ determinations in designating psilocybin as a Schedule I drug that it has a high potential for abuse, no currently accepted medicinal use in treatment in the United States, and a lack of accepted safety for use under medical supervision.
• Aggarwal’s cited historical scenarios involving Schedule I controlled substances — including marijuana — were not persuasive.

The Ninth Circuit found in favor of the DEA, ruling that the DEA’s reasoning in blocking Aggarwal’s access to the DEA was not arbitrary and capricious.  While the Ninth Circuit didn’t declare the following reasoning the rule of land even within the Ninth Circuit, it did make clear that the DEA’s reliance on this reasoning is not arbitrary and capricious:

• “The CSA and FDCA together govern access to controlled substances for medicinal purpose.”
• “Although the RTT Act itself does not require FDA approval for eligible patients to access eligible investigational drugs, it does not exempt such drugs from the FDA’s Attorney-General-delegated oversight pursuant to the CSA.” “So DEA’s continued enforcement of the CSA’s registration requirement does not affect, modify, repeal, or supersede the FDCA as amended by the RTT Act.”
• The Ninth Circuit did not reject the DEA’s reliance on Congress’ determination, as codified in the CSA, that psilocybin has a high potential for abuse, no currently accepted medicinal use in treatment in the United States, and a lack of accepted safety for use under medical supervision.

So, What Does an Opinion Brushing Back One Physician on the West Coast Mean to the Psychedelics Industry More Broadly?

Proponents and physicians who are looking for easier access to psilocybin outside of the research context will see this as a significant step back. The DEA dealt a significant setback to the ability to rely on the RTT Act or to seek a waiver of registration. The Ninth Circuit didn’t really pull back the reigns. The DEA’s position that, even if a physician is able to obtain approval under the RTT, he or she still must obtain registration or a waiver under the CSA has now been approved (or at least not disapproved). And that position was pretty clear: The DEA is still in charge.

So, what does the opinion not mean? This opinion does not foreclose the efforts of physicians interested in conducting research blessed by the CSA and FDA. As we’ve previously reported, interest in researching psychedelics remains high and it appears capital does, too. Indeed, there are strong pushes for research in the federal, state, and private sectors with corresponding funding. There is no indication — and we have no expectation — that it will slow down any time soon, and the Ninth Circuit’s decision does nothing to change our thoughts on that point. Indeed, it appears to be, at least according to the DEA as approved by the Ninth Circuit, the clearest path forward.