The ECB said it had decided on a reduced ban of 15 months because the 21-year-old had admitted using the drug and shown remorse. It said the recommended punishment was two years.
Warwickshire said in a statement: "The club is very disappointed that one of its players has tested positive for a banned substance but is pleased to note that he has shown remorse and pleaded guilty to this serious offence."
It said Wagg's contract would be terminated but it would help him during his rehabilitation period.
