Legalization, Decriminalization, Regulation — What Does It Mean in Psychedelics?
September 8, 2022

Legalization, Decriminalization, Regulation — What Does It Mean in Psychedelics?

According to a 2017 National Survey on Drug Use and Health, 19.7 million American adults 12 and older lived with a substance use disorder while 8.5 million American adults lived with co-occurring mental health and substance use disorders – and these numbers continue to rise.   

The need to address this growing problem with new solutions has many people curious about the therapeutic potential of psychedelic medicine.  

But this is often followed by the question: are psychedelics even legal? The answer is nuanced. The legal status of psychedelic products and services depends on geographic location as well as the business model of the organization providing them.  


What Are the Different Psychedelic Business Models? 

In general, these organizations fall into three main categories: research and development of psychedelic medicines (through clinical trials); delivery of psychedelic-assisted therapies (such as telemedicine or clinic operators, which is what we provide at Numinus); and ancillary services to support these (such as legal and advisory services). There is also increasingly robust investment into these businesses, both from retail and institutional investors.   

These organizations have varying perspectives on how regulations around psychedelics should change – whether to legalize, decriminalize or regulate – which affect their operations and the development of the psychedelics sector.  

Let’s review the legal status of controlled substances, the impact on different business models, how policies can change, and why the legal status of psychedelics is fundamentally a health issue, not a criminal justice one. 


What is Legalization? 

Legalization means making a controlled substance permissible by law and removing criminal sanctions on its use and possession. The legalization of substances exists at the federal level in both Canada and the US, as well as the provincial level in Canada and state level in the US. 

 Currently, the only substances legally available across Canada are cannabis, alcohol, and tobacco. In the US, alcohol and tobacco are legal; cannabis is legal in certain states.  

 With legalization, there are still regulatory measures, such as age and vendor restrictions.

What is Decriminalization? 

Decriminalization means removing criminal sanctions on drug law violations or possession of controlled substances in small quantities. Other civil penalties, like small fines or warnings, could still apply under decriminalization.    

Decriminalization is an evidence-based policy strategy that speaks to a broad spectrum of possible practices and policies to address drug use; it can help move towards replacing legal punishment with care, such as treatment or access to educational programs.   

In Canada, British Columbia was the first province to announce its plan to decriminalize possession up to 2.5 grams of “hard drugs”, including opioids, cocaine, methamphetamine, and MDMA. This change will take effect starting January 31, 2023 until January 31, 2026, at which time it will be reviewed.   

In the US, Oregon was the first state to remove criminal punishment for small amounts of hard drugs, such as LSD, psilocybin, methamphetamine, MDMA, and heroin. On a municipal level, Denver was the first US city to decriminalize psilocybin. Cities that followed suit include Somerville, Northampton and Cambridge, Massachusetts; Ann Arbor, Michigan; Washington, DC; and Oakland and Santa Cruz, California. 


What is Regulation?  

Regulation means the conditions applied to a legal substance or specific use cases.
Ketamine is an example of a drug that falls under regulation in Canada and the US; ketamine is legal as an anesthetic medication in medical settings, while its “off-label use” is only regulated for legal use as a treatment of mental health conditions like PTSD and depression in ketamine-assisted therapy. “Off-label use” refers to the common healthcare practice of using an approved medication for an unapproved health indication separate from its primary approved use.
Governing bodies may also choose to regulate treatments that are unauthorized for use by the general public in unique cases or as part of clinical trials. For example, the Government of Canada has created the Special Access Program, which allows individuals to request access to psychedelic-assisted therapy using MDMA or psilocybin, making it regulated for legal use only with specific government permission.
In the US, MDMA is closest to possible regulated approval as a medicine when used in conjunction with therapy, as research data has shown positive results on those who suffer from PTSD. Data from a first phase 3 clinical trial showed a major benefit and a second confirmatory phase three trial is currently underway with a planned US FDA submission in 2023.
Another case of regulation in the US can be seen in Oregon, where psilocybin mushrooms have been legalized for use in a therapeutic setting under licensed supervision, with the state program for this going into force in January 2023.


Recent Developments in Drug Laws, Socioeconomic Implications, and Next Steps 

While changes like the recent move towards decriminalization in British Columbia and in Oregon have been promising, there are many challenges around building safe supply and standardized injection sites or locations for monitored consumption, improving education about and access to treatment, and addressing the disproportionate impact of current drug policy on racialized and other marginalized communities. 

A prominent behind this disproportionate impact on these communities is the War On Drugs campaign, which was implemented by the U.S. government in 1971 and continues today. The War on Drugs is responsible for harsh and unreasonable laws and punishment for the possession of illicit drugs in the United States. Despite the progress made in drug reform, the policies guiding the War on Drugs have hardly changed.   

Data from 2022 that shows the United States has the largest incarceration rates in the world. Police make over 1 million drug-related arrests each year on possession alone, and 1 out of 5 incarcerated individuals is in prison for drug possession. Of these incarcerations, 38% are Black Americans, even though Black Americans make up only 12% of the entire U.S. population.  

The next steps for drug reform will require a framework that prioritizes education, harm reduction, reconciliation, and intentional design for accessibility.  

Our Position on the Legal Landscape of Psychedelics at Numinus 

Here’s what our CEO, Payton Nyquvest, shared with regards to supporting local efforts to decriminalize psychedelics and their benefit for therapists. 

Over the last decade, new research has increasingly shown that psychedelic-assisted therapies can be effective for a range of mental health conditions, including indications such as depression, anxiety, addiction, and PTSD. We have also seen growing evidence that many conventional medications for mental illness, such as commonly prescribed antidepressants, often are not efficacious or have serious side effects that significantly decrease quality of life. 

Given this evidence, we need to build innovative but practical solutions that can be integrated into the healthcare system through collaboration with systems administrators, regulators and the many other stakeholders involved in public health, including the public itself. One avenue is to reassess current drug schedules, understanding the historical contexts that informed past policy decisions. Decriminalization and legalization will help to reduce stigma and provide education around the use of psychedelics in a safe and evidence-based environment. Only by considering the complex factors, systems and stakeholders involved in public health can we build solutions that are accessible and sustainable for the greater good.” 


Key Takeaways 

To transform mental healthcare, change needs to happen in parallel, from the socioeconomic and cultural realm to development of treatments. 

A move towards decriminalization and legalization could help to:  

  • Reduce stigma around substance use 
  • Minimize health risks associated with illicit substance use, such as overdose  
  • Foster greater awareness and community-building around mental health 
  • Increase safe access and standardized treatment
  • Encourage discourse around social impact, justice and reform  

While legalization and decriminalization alone do not equate to treatments that are 100% safe (as no clinical treatment has such a guarantee), they are major components of building infrastructure for accessible psychedelic medicine, alongside education, research and development. 


How Can I Learn More About Psychedelics?  

While we hope this article provides clarity on the legal and regulatory landscape of psychedelics, it’s a constantly evolving subject and we recognize you may still have questions.  

If you are currently using or are curious about using psychedelics, we encourage you to seek professional guidance to help guide you on your exploration. Numinus offers both group and individual services to support you.  



This article in no way promotes, condones, or facilitates illegal activity, and is strictly for educational and harm reduction purposes only. Please be aware that certain psychedelic substances still remain illegal in many jurisdictions, including Canada. This program and the contents of this website do not constitute medical advice, and are not a substitute for professional medical advice and treatment. 

 All information is per the time of this article’s publication. The regulatory landscape is quickly evolving, and some information is subject to change.