What happened

Shares of Aurora Cannabis (NASDAQ:ACB) were falling by 12.3% as of 3:23 p.m. EST on Friday. Shares of Aurora's fellow Canadian marijuana stocks Canopy Growth (NASDAQ:CGC) and HEXO (NASDAQ:HEXO) (TSX:HEXO) were sinking by 8.2% and 14.3%, respectively. Why? The initial euphoria over the U.S. House of Representatives Judiciary Committee's vote to pass a bill that would legalize marijuana in the U.S. evaporated.

So what

All three of these stocks soared earlier this week after the House Judiciary Committee voted 24-10 in favor of proposed legislation that would remove cannabis from the Controlled Substances Act, a change that would legalize cannabis at the federal level in the U.S. Investors reacted with wild enthusiasm over this milestone.

Rustic U.S. flag framed by cannabis leaves

Image source: Getty Images.

It didn't take long for reality to set in, though. As encouraging as the House committee's action was, there are several more hurdles to jump over before marijuana will be legalized throughout the U.S. And some of those hurdles are high ones (no pun intended).

The prospects of the proposed bill passing in the U.S. House of Representatives appear to be good. The problem is with the U.S. Senate, where Majority Leader Mitch McConnell (R.-KY.) remains opposed to marijuana legalization.

In addition, it's uncertain whether or not Senate Judiciary Committee chairman Lindsay Graham (R.-S.C.) would even bring a marijuana legalization bill before his committee. With both Sen. McConnell and Sen. Graham potentially standing in the way, it's quite possible that the U.S. Senate won't even take up the matter of marijuana legalization anytime soon.  

Now what

None of this should be unexpected for investors in marijuana stocks. The political process in the U.S. doesn't tend to move quickly. 

In the meantime, the best thing to do is to focus on the other opportunities for Aurora, Canopy, and HEXO. All three companies should benefit as the retail infrastructure in Canada expands.

These companies are also poised to enjoy revenue gains as the Cannabis 2.0 derivatives products market shifts into gear. However, the big prize of the U.S. cannabis markets opening up to these companies won't be happening for awhile.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.