Shares of leading cannabis companies experienced a significant surge on Monday after US President Donald Trump drew attention to the potential benefits of hemp-derived cannabidiol (CBD) for senior healthcare.
Trump used his Truth Social account on Sunday to share a video produced by The Commonwealth Project (CTP), an advocacy group focused on integrating medical cannabis into mainstream healthcare for individuals over 65.
The market reacted strongly to the development. Shares in Tilray Brands, a medical cannabis company, jumped 41 percent during afternoon trading in New York. Cannabis-focused peer Canopy Growth surged 17 percent, while Cronos Group gained 13 percent. This market lift provides the sector with some hope after persistent regulatory uncertainty had knocked share prices over the past year.
The CTP video outlined several potential benefits of CBD use for seniors, including reduced pain and stress, improved sleep, and the slowing of disease progression. CBD is a compound found in cannabis that differs from tetrahydrocannabinol (THC), the component responsible for giving users a “high”.
The video explicitly called for Medicare coverage for CBD, the federal health insurance program for people in the US aged 65 and older. It also advocated for the education of doctors regarding the body’s endocannabinoid system, which regulates functions like mood and sleep.
Trump did not comment on the content of the video but his decision to share the video follows his recent statement that his administration was reviewing the possibility of reclassifying marijuana as a less dangerous drug.
Such a move at the federal level would follow efforts by ex-president Joe Biden to shift cannabis from a Schedule I drug to Schedule III. Reclassification would be pivotal for cannabis companies, as it would allow them to take advantage of standard business tax deductions from which they are currently barred.
Despite the renewed optimism, the sector still faces regulatory challenges.
For instance, Republican Senator Mitch McConnell, who championed the federal legalisation of hemp in 2018, recently sought to ban hemp derivatives containing a quantifiable amount of THC, the psychoactive ingredient found in cannabis.
The difficulty of producing CBD products without trace amounts of THC means such a ban could have adverse implications for US hemp growers. Furthermore, a bill in California is currently awaiting the signature of Governor Gavin Newsom that would ban the sale of intoxicating hemp products outside authorized dispensaries.