MMJ International Holdings Enters Legal Fight Over CMS Hemp Pilot

"A federal pilot built on the 0.3% THC loophole is reshaping cannabinoid access policy-without FDA approval, without reimbursement transparency, and without advance market notice" stated Duane Boise, CEO MMJ International Holdings.

WASHINGTON, D.C. / ACCESS Newswire / April 9, 2026 / MMJ Holdings Throws Its Weight Into the Legal Fight

A cannabis biopharma company is seeking to join the federal lawsuit challenging the Centers for Medicare & Medicaid Services' (CMS) new hemp and CBD pilot program, adding a pharmaceutical voice to a government-sanctioned program allowing untested and unregulated hemp products into the marketplace.

MMJ International Holdings and its subsidiaries, MMJ BioPharma Labs and MMJ BioPharma Cultivation, have moved to join the lawsuit filed by Smart Approaches to Marijuana (SAM) and other plaintiffs against CMS and federal health officials.

The move comes after the court denied the plaintiffs' emergency request for a temporary restraining order on March 31, allowing the program to launch while the litigation continues. The court is scheduled to hold a preliminary injunction hearing on April 20.

SAM and its co-plaintiffs filed suit on March 30 in the U.S. District Court for the District of Columbia seeking to block CMS's new Substance Access Beneficiary Engagement Incentive, or BEI. The optional Innovation Center program allows participating organizations to discuss eligible hemp-derived products with Medicare beneficiaries and, under the model's rules, furnish them for symptom management.

CMS has argued that the BEI is not a broad Medicare coverage expansion and does not directly reimburse hemp or CBD products in the same way as a traditional Medicare benefit.

SAM has a long history of opposing cannabis reform and has consistently fought state legalization measures, cannabis banking legislation, and broader federal recognition of cannabis-derived products. In the current case, SAM argues that CMS created the pilot without going through the formal notice-and-comment process required under the Administrative Procedure Act.

The plaintiffs also contend that the program conflicts with the Federal Food, Drug, and Cosmetic Act and with CMS's own previous position that cannabis products are not eligible for Medicare coverage.

At the center of the case is a larger policy debate over whether CMS can use an innovation model to create a limited access pathway for hemp-derived CBD products before the FDA has approved them as prescription drugs. Supporters of the pilot say it could improve access for patients with chronic conditions. Opponents argue it effectively endorses unapproved substances without sufficient scientific or legal safeguards.

MMJ's position differs from SAM's broader anti-cannabis stance. The company has publicly argued that cannabinoid products should move through the FDA's botanical drug pathway before they receive federal reimbursement or endorsement.

According to court filings, MMJ describes itself as a developer of plant-derived cannabinoid therapeutics and says it has spent years pursuing cannabinoid drug development for Huntington's disease and multiple sclerosis. The company has repeatedly criticized the CMS pilot in a series of March press releases, warning that the government is moving toward reimbursement before scientific evidence and FDA review are complete.

In one March 27 statement, MMJ CEO Duane Boise said, "A soft-gel is a medicine; a gummy is a snack."

Federal defendants do not oppose MMJ joining the lawsuit. However, they are asking the court to reject the plaintiffs' request to delay the briefing schedule and postpone the April 20 hearing.

The government argues that MMJ has been publicly criticizing the BEI since early March and was aware of the lawsuit no later than March 31, when the company issued a press release linking directly to the complaint. Yet MMJ did not seek to join the case until April 7, less than 48 hours before the government's opposition brief was due.

According to the defendants, the timing suggests MMJ is being added not because of any urgent injury, but because the court raised questions during the March 31 hearing about whether the original plaintiffs have legal standing, unlike MMJ Holdings, which has invested millions over several years to build its cannabinoid drug development program.

MMJ sees the issue very differently. The company argues that it has spent years and millions of dollars pursuing the FDA botanical drug pathway, conducting research, seeking federal approvals, and building cannabinoid therapies for serious conditions such as Huntington's disease and multiple sclerosis. From MMJ's perspective, the CMS pilot creates an uneven playing field by allowing hemp-derived products to reach Medicare beneficiaries through a federal program without first meeting the same FDA standards that MMJ has been required to satisfy.

MMJ has repeatedly argued in public statements that the BEI could undercut companies investing in formal drug development while opening the door to products that have not undergone the same clinical testing, manufacturing controls, or regulatory scrutiny. In that sense, MMJ is not opposing cannabinoid medicine itself. Rather, it argues that if the federal government is going to support cannabinoid products, it should do so through the same approval process that pharmaceutical developers have been required to follow.

The filing further suggests that the government may contest MMJ's public statements that the FDA has accepted its investigational drug applications and that it has a federally authorized Huntington's disease program. Defendants said they may seek permission to submit confidential declarations under seal to address those claims.

Defendants additionally argue that MMJ cannot demonstrate irreparable harm because its alleged injuries, including reduced investor confidence, future competitive disadvantage, and lost earnings, are speculative and tied to products that remain years away from commercialization.

The government contends that delaying the case would create more uncertainty around the newly launched pilot program and could discourage healthcare organizations from participating while the lawsuit remains unresolved.

The court has not yet ruled on whether MMJ may join the case or whether the April 20 hearing will proceed as scheduled.

WRITTEN BY PAM CHMIEL

CONTACT:
Madison Hisey
MHisey@mmjih.com
203-231-8583

SOURCE: MMJ International Holdings