FDA’s CBD Public Meeting featured a full house of manufacturers, researchers, health professionals, trade association representatives, and other stakeholders.  Each speaker was given a few minutes to offer their input in response to FDA’s call for submissions relating to health and safety risks; manufacturing and product quality; and  marketing, labeling, and sales.  Here are key themes and highlights:

  • Opening Remarks:  Acting FDA Commissioner Ned Sharpless opened the meeting by acknowledging the “explosion” of consumer interest and the complexity of the task that FDA faces given hemp’s long prohibition:  “When hemp was removed as a controlled substance, this lack of research, and therefore evidence, to support CBD’s broader use in FDA-regulated products, including in foods and dietary supplements, has resulted in unique complexities for its regulation, including many unanswered questions related to its safety,” he noted.  He also responded to Congressional and stakeholder pressure to explore a pathway for CBD in foods and dietary supplements by noting that the agency has a high-level working group focused on the issue.
  • Regulatory Structure:  Per the Natural Products Association, approximately 1500 new CBD products have been introduced over the last three years.  Overwhelmingly, manufacturers and trade association representatives called on FDA to provide a predictable pathway to market, in large part by enforcing existing laws relating to product categories, such as DSHEA.  Multiple speakers discussed the history of hemp in the diet as the basis for treatment of hemp extracts as a safe dietary ingredient, with some acknowledging that CBD isolate could be continued to be regulated as a drug.  In addition, there were many calls to enforce quality standards such as GMPs, identity testing, product testing for contaminants, labeling requirements, and adverse event reporting.

The three to five year timeframe that FDA previously referenced for a potential new regulation was a significant concern to many stakeholders.  Several speakers called on FDA to issue guidance as it explores a potential pathway for CBD in foods.  One speaker, Douglas MacKay of CV Sciences, encouraged FDA to create a “lane” for different product categories, i.e., drugs, foods, dietary supplements, based on dosages and intended use, using omega-3s as an example of an ingredient that currently exists in similar “lanes.”

  • Consumer Use and Understanding:  Lisa Gill from Consumer Reports presented consumer survey data with several interesting findings, including the following:  26% of U.S. consumers have used CBD.  Of these, edibles are the most commonly used.

Consumers are most likely to obtain CBD from a cannabis dispensary.

And – perhaps most interesting from a public health perspective – many consumers replace OTC or Rx medications with CBD and are strongly of the opinion that it is effective.

  • Marketing and Labeling:  Many speakers expressed concern over aggressive product claims, questionable manufacturing and testing practices, and adulteration with not just THC but other contaminants.  Several speakers presented data based on product sampling and testing of CBD content, THC content, contaminants such as lead, pesticides, etc.  Generally speaking, the takeaway was that CBD products feature highly variable potency and contamination levels.  Two speakers who had conducted separate product surveys each found just one product that featured 100% of the amount of CBD listed on the label.  Others contained no CBD and some contained multiples of the label claim.  In addition, in one survey, 45% of products tested contained THC, although amounts detected were not indicated in the results presented.

  • Health and Safety Risks:  The World Health Organization report regarding CBD was cited by several speakers as support for the general safety and lack of evidence of addictive properties.  However, key concerns noted included limited understanding of potential drug interactions between CBD and other medications and, in particular, the dose/effect relationship between such interactions.  GW Pharmaceuticals and academic researchers acknowledged the potential for CBD-associated liver damage discovered during the Epidiolex trials and other studies.  Other speakers encouraged FDA to review data gathered from state medical marijuana programs (some of which include CBD products) relating to adverse events and drug interactions.  The effect of cumulative exposure from several product types was also cited as an area requiring further research.
  • Research Restrictions:  Researchers from several universities throughout the countries as well as practitioners of several specialties presented findings based on clinical studies and patient treatment with CBD and medical marijuana.  While their interests varied, they universally supported more research into the safety and efficacy of CBD and expressed concern about their ability to access market-grade product for research.  In particular, they cited restrictions relating to DEA scheduling, DEA’s delay in issuing cannabis permits, the inferior quality of cannabis (marijuana) that is obtainable from the U of Mississippi (the only federally-sanctioned site for cultivation), the IRB process, and related gating steps that are required for clinical studies as barriers to pursuing research.

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Throughout the day, FDA panelists asked a variety of questions such as what the speakers believed are the health benefits of CBD, what support they have for that conclusion, the number of new manufacturers who have entered the CBD market over the last few years and the degree to which they are following GMPs, and the body of evidence relating to food producing animals and pet products generally.

As expected, the meeting was largely a listening exercise and the first step in a deliberative process.  Comments can be filed until July 2.

Assembly Bill 228 is a promising piece of legislation that could soon bring an end to California’s prohibition on adding hemp-derived CBD to foods, beverages, and cosmetics.  The bill, in its current form, would add two provisions to the California Health and Safety Code clarifying that food, beverages, and cosmetics are “not adulterated by the inclusion of industrial hemp, as defined in Section 11018.5, or cannabinoids, extracts, or derivatives from industrial hemp.”  The provisions would further provide that such items “that include industrial hemp or cannabinoids, extracts, or derivatives from industrial hemp shall not be restricted or prohibited based solely on the inclusion of industrial hemp or cannabinoids, extracts, or derivatives from industrial hemp.”

AB 228 stands in direct contrast to the California Department of Public Health’s (“CDPH”) current policies.  As we wrote about here, in July 2018, CDPH released a set of FAQs that included a summary of the agency’s position on CBD being added to foods:

Until [1] the FDA rules that industrial hemp-derived CBD oil and CBD products can be used as a food or [2] California makes a determination that they are safe to use for human and animal consumption, CBD products are not an approved food, food ingredient, food additive, or dietary supplement.

Neither of these thresholds have been met: The FDA’s position is still that hemp-derived CBD cannot be used as a food, and AB 228, as amended, does not explicitly state that hemp-derived CBD products are safe to use for human and animal consumption.  Further, the CA bill does not list dosage thresholds for use in any product.

Despite this official position, CDPH’s FAQ is not law, and it has not been systematically enforced.  While hemp CBD products are widely available in California, passage of AB 228 seems likely to expand that state’s market even further by clarifying and sanctioning a pathway to market.  While FDA retains jurisdiction over foods transported in interstate commerce, the size of California’s economy and the number of states that currently allow CBD in foods is pushing toward critical mass and geographic distribution, potentially making FDA’s role in regulating this issue even more complex.

The Alcohol and Tobacco Tax and Trade Bureau (“TTB”) recently updated its guidance on inclusion of hemp ingredients in beverages containing alcohol. Here’s a summary:

• It remains TTB’s policy that it will not approve any formulas for alcohol beverages that contain ingredients that are controlled substances under the federal Controlled Substances Act.
• TTB is continuing to consult with the FDA on the use of ingredients derived from hemp.
• After consultation with FDA, TTB is returning for correction any applications for formulas containing “hemp” ingredients – other than ingredients derived from hemp seeds or hemp seed oil.

In short, TTB is following FDA’s position that it is unlawful to introduce or deliver for introduction into interstate commerce a food to which CBD or THC has been added. This topic is slated for a full day of discussion at the public hearing that FDA is holding on May 31.

For those readers who may be new to regulation of alcohol and how this relates to FDA, here’s the high-level:

• The Federal Alcohol Administration Act (“FAAA”) governs interstate commerce of wine, spirits, and malt beverages as defined in the statute. TTB is the agency charged with administering the FAAA.
• Unlike FDA, TTB requires that labels and formulas for products within its jurisdiction must be submitted prior to sale.
• Not all alcohol beverages fall within the FAAA, however, leaving FDA with jurisdiction over products that fall outside of the stated definitions.
• Transport in interstate commerce is required for either agency to have jurisdiction.

This isn’t the end of the story, though. As with all things related to CBD, state laws regarding inclusion of CBD in food products and alcohol are a patchwork, including some at the local level as we’ve written about here. Companies entering this space will want to sort through these complexities and follow the dynamic legal environment closely.

The FDA and FTC jointly issued warning letters to three companies selling CBD products online. The letters allege violations of the Federal Food, Drug, and Cosmetic Act (“FDCA”) and the Federal Trade Commission Act (“FTCA”). Although this is the first time the FDA and FTC have issued joint warning letters relating to CBD, the FDA has been involved in CBD enforcement for the past few years.

Since the passing of the 2018 Farm Bill, which descheduled hemp and hemp derivatives under the federal Controlled Substances Act, the FDA has become the primary federal regulator relative to foods, drugs, cosmetics, and dietary supplements that contain CBD from hemp. The FDA’s most visible enforcement on CBD products to date has been in the form of warning letters issued to online retailers of products labeled as dietary supplements that feature aggressive disease treatment claims. The FDA also tested CBD products in conjunction with warning letters issued in 2015 and 2016 to determine whether they contained the CBD levels listed on the labels.

In the letters from last week, the FDA turned its focus onto various CBD products marketed online as “drugs,” including “CBD Salve,” “CBD Oil,” “CBD for Dogs,” “Hemp Oil,” “CBD Softgels,” “Liquid Gold Gummies (Sweet Mix),” “Liquid Gold Gummies (Sour Mix),” and “blue CBD Crystals Isolate 1500mg.” The FDA determined that the companies’ websites contained claims about their CBD products that established them as unapproved “drugs” under section 201(g)(1) of the FDCA. The letters also referenced the FTC’s substantiation standard, stating the FTC had concerns that certain efficacy claims that were made may not be substantiated by competent and reliable scientific evidence. They also warned that violations of the FTCA may result in legal action seeking a Federal District Court injunction or Administrative Cease and Desist Order, possibly including a requirement to pay back money to consumers.

As noted above, these letters are unique, as it is the first time the FDA has issued a joint FDA/FTC warning letter relating to CBD. This is also the first time the FDA has referenced the FTC’s substantiation standard or threaten any specific penalty for violations of the FTCA. For companies marketing CBD, it is important to keep in mind that although the market has flourished despite a host of regulatory uncertainties, it is the regulators’ opinion that the rules regarding advertising and health claims are clear. Competent and reliable scientific evidence remains the standard.

Over the last few years, however, the FTC’s health claim enforcement has featured several false cure-type products. Cases against Regenerative Medical Group, Cellmark, iV Bars, and Nobetes challenged unproven representations for products promising to treat Parkinson’s disease, macular degeneration, cancer, multiple sclerosis, and diabetes. Although we have yet to see the FTC announce any settlements relating to CBD products, these letters signal that FDA is not alone in its concern over aggressive CBD treatment claims.

The warning letters can be found here:

Advanced Spine and Pain, LLC (d/b/a Relievus)
Nutra Pure LLC
PotNetwork Holdings, Inc.

On March 5, 2019, FDA Commissioner Scott Gottlieb, M.D. and FDA/CFSAN Director, Susan Mayne, Ph.D., released new independent test results confirming asbestos contamination in certain cosmetic products sold by Claire’s and Justice retailers.  The agency also issued a safety alert warning consumers not to use the cosmetic products sold by Claire’s that had tested positive for asbestos that, at the time, had yet to be recalled.  FDA announced a voluntary recall on March 12th.

The FDA statement issued in conjunction with these actions stressed the importance of cosmetic safety and key challenges presented by the cosmetic provisions of the federal Food, Drug and Cosmetic Act (FDCA). The FDA noted that the provisions, which have not been updated since the law was enacted in 1938, do not require cosmetic manufacturers to test their products for safety. Thus, the agency called on the cosmetic industry to do more to ensure product safety, noting that FDA has “only limited tools” regarding cosmetics and is “dependent on manufacturers” that “bear critical responsibilities” related to product safety.

The FDA statement laid out a number of steps the agency is taking “to reinforce the obligations of manufacturers” to ensure the safety of the cosmetic products they market. As FDA determines further steps it should take to protect consumers, the agency has identified a few action items to better understand the cosmetic industry:

  • Working “with cosmetics manufacturers and requesting information about what procedures they use to ensure their cosmetics are safe” and that “talc used in any cosmetic product is free from asbestos”;
  • Investigating how manufacturers source talc with appropriate traceability, and whether they test raw talc and/or their finished products;
  • Determining how many cosmetics products contain talc; and
  • Evaluating whether manufacturers have received adverse event reports associated with talc-containing products.
  • FDA also expressed a commitment to take other actions based on the agency’s existing authority under the FDCA “by leveraging [such] authorities to the greatest extent.”  This includes:
  • Making determinations if certain cosmetic ingredients should be prohibited or restricted;
  • Testing products made with talc and taking the necessary regulatory and enforcement actions; and
  • Creating an interagency working group to propose draft standards to improve consistency for talc testing.

In addition, the FDA statement calls upon cosmetic firms to take the following voluntary actions, which are not currently required under the FDCA for cosmetic products manufacturers:

  • Register cosmetic products and list ingredients, including talc, that are used in their cosmetic products with the Voluntary Cosmetic Registration Program; and
  • Proactively report adverse events involving cosmetic products to the CFSAN’s Adverse Event Reporting System.

The statement suggests that the current “outdated” FDCA cosmetic framework, and the limited resources available for FDA’s cosmetic programs, are impediments to ensuring cosmetic safety and consumer protection. To remedy this, the agency proposes working with stakeholders and Congress to “modernize” the scope of FDA’s cosmetic authority in light of “the industry’s significant expansion.” Potential legislative action may have elements that resemble the FDA Food Safety Modernization Act (FSMA), enacted in 2011, and other FDCA provisions that currently apply to foods. As FDA explained:

To improve consumer safety and secure our mission for years to come, a more modern approach could include tools that are tailored for cosmetics, including appropriate frameworks for registration and listing of products and their ingredients, good manufacturing practice regulations, company reporting of adverse events, access to records (including consumer complaints) during routine or for-cause inspections, mandatory recalls, disclosure of known cosmetic allergens on a product’s label, and ingredient review.

FDA’s actions have been met with congressional approval as at least one congressman has indicated that legislative action may already be in the works. On March 5, 2019, Energy and Commerce Chairman Frank Pallone, Jr. (D-NJ) released a statement commending FDA’s commitment to ensuring the safety of cosmetics noting:

Every day millions of Americans assume the cosmetics they use are safe, but unfortunately that is not always the case. The reality is that cosmetics are one of the least regulated consumer products on the market and FDA acknowledged today that the agency does not have the necessary authority to oversee the industry. . . . Unfortunately, FDA does not currently have the authority to mandate a recall on the products. Examples like Claire’s refusal to voluntarily recall their asbestos-tainted products demonstrates the need to modernize the current regulatory framework for cosmetic and personal care products to ensure that FDA can act to protect consumers when industry fails to do so. That is why I have already begun the process of circulating a bipartisan discussion draft on a proposal to update our laws for the first time in over eighty years.

On March 7, 2019, Senators Feinstein (D-CA) and Collins (R-ME) introduced a co-sponsored bill entitled, the “Personal Care Products Safety Act.” The bill is designed to expand FDA’s authority to regulate personal care products, including by authorizing FDA to: review the safety of at least five cosmetic ingredients annually; recall unsafe products; establish new labeling requirements; establish adverse event reporting requirements; and require companies to register with FDA annually and provide the agency with information concerning their products’ ingredients.  The bill would also direct FDA to issue Good Manufacturing Practices regulations and authorize the agencies to collect user fees from product manufacturers to fund these activities.  A number of companies and health and consumer organizations support the bill.

FDA’s recent announcement indicates it recognizes the growth of the cosmetic industry and is subsequently seeking ways to increase its regulatory oversight. We will continue to keep you posted with any updates in this space.

The National Milk Producers Federation (NMPF) yesterday submitted a citizen petition to FDA related to the use of dairy terms such as “milk,” “yogurt,” “cheese,” “ice cream” and “butter” in the statements of identity for non-dairy plant-based substitutes. The petition argues that the use of these standardized dairy terms to name non-dairy foods falls short of FDA requirements, “falsely implies that the non-dairy substitutes are equivalent to and interchangeable with standardized dairy foods,” and “fails to disclose the material facts concerning how these non-dairy substitutes differ from standardized dairy foods or adequately distinguish non-dairy substitutes derived from different plant sources.”

The NMPF petition asks that the Agency: (1) take enforcement action against misbranded non-dairy foods that substitute for and resemble reference standardized dairy food(s) but are nutritionally inferior to the reference food and include the name of the reference food in the statement of identity; and (2) amend section 101.3(e) of FDA regulations to codify policies that permit use of standardized dairy terms for non-dairy substitutes that resemble and substitute for the same reference dairy food only under defined conditions.  The latter proposal to amend section 101.3(e) would be limited in the following notable ways:

  • The proposal applies only to “non-dairy foods that substitute for and resemble standardized dairy foods,” which are defined as foods that contain no single dairy ingredient or combination of dairy ingredients in amounts that are sufficient to constitute major ingredients and that substitute for and resemble a food that is a standardized dairy food (e.g., “milk,” “yogurt,” “cheese,” “ice cream” and “butter”).
  • The proposal applies distinct requirements depending on whether the non-dairy substitute food is nutritionally inferior or nutritionally equivalent to the reference standardized dairy food:
    • For nutritionally inferior non-dairy substitute foods, the statement of identity could identify a reference standardized dairy food, provided that either: (1) the name of the food were qualified through use of the legally defined term, “imitation”; or (2) the name of the food were qualified through use of the term “substitute” or “alternative” and material differences including nutritional inferiority and performance limitations were disclosed.
    • For nutritionally equivalent non-dairy substitute foods, the statement of identity could identify a reference standardized dairy food, provided that the name of the food were qualified through use of the term “substitute” or “alternative” and material differences, including performance limitations, were disclosed.
  • The proposal would not apply to non-dairy foods that do not: (1) substitute for and resemble a standardized dairy food; and (2) reference the standardized dairy food substituted for and resembled as part of its statement of identity (i.e., would apply to “oat milk, “ but not “oat beverage”).

The Statement of Grounds in the NMPF petition argues that the enforcement and regulatory actions the petition asks FDA to undertake are amply justified on statutory, regulatory and First Amendment grounds, and advance FDA’s consumer protection and public health policy objectives.

The NMPF petition was filed in the wake of the agency’s recent request for public comment on related issues, which resulted in more than 13,000 comments being filed in the FDA docket.

The U.S. and other companies that export foods, additives, colorings, etc. to the European Union (EU) should take notice: new legislation applicable to the agri-food industry is being billed as one of the world’s “most transparent” laws raising potential concerns about protecting proprietary information from competitors.  Controversy surrounding the use of genetically modified organisms and the associated herbicide glyphosate paved the way for a European citizens’ initiative, which ultimately led to a legislative proposal by the European Commission to enhance public confidence in risk assessment of foods.  The ensuing regulation on the transparency and sustainability of the EU risk assessment in the food chain will amend the EU’s General Food Law Regulation, a law that was adopted following a series of food incidents in the late 1990s.

The revised regulation aims to ensure that market approvals related to the food chain by the European Food Safety Authority (EFSA) are founded on reliable, objective and independent studies and risk analysis.  It will entail automatic publication of all studies and information submitted to EFSA to support the authorization of a proposed product or ingredient.  It appears that this data will be uploaded early in the approval process, a decision opposed by industry groups.  In addition, the law will establish a database of studies for EFSA to verify whether all relevant research on a substance is considered in evaluating market applications.  The intent is to deter corporations from withholding unfavorable data.  In addition, stakeholders and the general public will be invited to join consultations to help identify any omitted information and ensure EFSA’s comprehensive access to evidence.

For obvious reasons, negotiation of the new legislation was plagued by thorny issues around business information as the legislators struggled to strike a balance between the protection of intellectual rights and commerce and exposing business secrets in a more transparent risk assessment process.  The final acquired text is not yet publicly available but it appears that confidentiality of information will be able to be maintained where companies provide a “verifiable” justification for doing so.  According to a document reportedly seen by Politico, companies will be able to seek confidential treatment of information on: “the manufacturing or production process, including the method and innovative aspects thereof, as well as other technical and industrial specifications inherent to that process or method, except for information which is relevant to the assessment of safety.”                                                                                                                                                                                                                                                                    The revised regulation requires formal approval of the European Parliament and the Council of the EU.  It is scheduled to take effect 20 days after its publication, however, operative provisions will be delayed for some time to come.

This morning, the FDA announced its intention to engage in greater oversight of the dietary supplement industry.  The announcement also conveyed that the Agency had sent 12 warning letters and five advisory letters to companies over the prior two weeks.  Some of these letters were jointly issued by FDA and the Federal Trade Commission, focusing on what the two agencies consider to be illegal and deceptive claims in advertising and labeling for products intended to treat Alzheimer’s and other serious diseases such as diabetes and cancer, rendering the products unapproved new “drugs” rather than “dietary supplements” under federal law.

In his statement, FDA Commissioner Scott Gottlieb stated an intent to step up FDA efforts to improve product safety and police deceptive claims.  Amongst other initiatives, Mr. Gottlieb stated that the Agency is developing a new “rapid response tool” to alert the public if a supplement contains an illegal ingredient or poses a health risk.  While supplement manufacturers should be pleased that efforts are being made to weed out bad actors, they should also be concerned about unintended consequences that might result from use of such a rapid response tool.  The damage to a brand from an FDA alert could be significant.

Gottlieb also indicated that FDA is working to “develop [new] guidance for preparing [new dietary ingredient] NDI notifications” to help ensure that the regulatory framework is both sufficiently flexible and adequately protects public safety.  As part of its work to modernize the NDI process, FDA is also planning to update its compliance policy regarding NDIs.  Mr. Gottlieb also weighed in on the idea of creating an FDA registry, whereby supplement manufacturers would be required to list products and ingredients.  The registry, presumably, would allow FDA to concentrate enforcement efforts, but before it could be created, Congress almost certainly would need to act.  Gottlieb’s statement seemed to acknowledge this, and he cited the possibility of “dietary supplement exclusivity” similar to the exclusivity presently enjoyed by drug manufacturers as another potential issue ripe for congressional consideration.

In order to concentrate on these issues and others affecting industry and consumers, Mr. Gottlieb reported that he has established a Dietary Supplement Working Group at the FDA, “comprised of representatives from multiple centers and offices across the agency.”  The Working Group will report directly to the Commissioner and will review “organizational structures, processes, procedures and practices in order to identify opportunities to modernize our oversight of dietary supplements.”  In addition to these steps, FDA will conduct a public meeting this spring that will focus on “responsible innovation and safety.”  All stakeholders are invited to provide comment on “how the FDA should strengthen the dietary supplement program for the future.”

Much of the justification for increased oversight is centered on what FDA has characterized as a startling increase in the number of dietary supplements generally, and adulterated and misbranded supplements specifically.  Whether the framework that FDA will put in place is narrowly conceived to address this problem, without creating unnecessary and burdensome requirements on reputable companies, remains to be seen.  Stakeholders should monitor these developments closely and consider engagement through public comments or participation at the public meeting given Gottlieb has made clear that the Agency wants to hear both from industry and consumers as it assesses how best to move forward.

The passage of the 2018 Farm Bill capped off a momentous year for cannabidiol, or CBD, a non-psychoactive derivative of cannabis.  As we wrote about here, the year kicked off with the rescission of the Cole Memo, the DOJ’s policy statement regarding enforcement in states where cannabis is legal.  The feared enforcement uptick never materialized, though.  By mid-year, FDA approved Epidiolex, a prescription drug made from CBD isolate for treatment of rare forms of epilepsy.  Later in the year, Sen. Majority Leader McConnell (R-KY) saw opportunity with the Farm Bill update to expand industrial hemp legalization at the federal level.  Following conference committee work to iron out differences, the House and Senate passed the final version in mid-December and the President signed it on December 20.

As companies consider the business opportunity, it’s important to separate the myths regarding what the Farm Bill did from the realities.

Myth #1:  CBD Is Fully Legal Since It’s Not A Controlled Substance Anymore.

It’s more complicated than that.  Regulation exists at the federal and state levels.  At the federal level, the 2018 Farm Bill de-schedules industrial hemp and various derivatives thereof, including CBD, from the Controlled Substances Act when produced in compliance with a state hemp program.  Industrial hemp is defined as cannabis (Cannabis sativa L.), and derivatives of cannabis with extremely low (less than 0.3 percent on a dry weight basis) concentrations of the psychoactive compound delta-9-tetrahydrocannabinol (THC). This means that the DEA no longer has jurisdiction over CBD from industrial hemp because it is no longer illegal under federal law.  DEA retains jurisdiction over CBD from marijuana because it remains a Schedule I substance.  The DEA isn’t the only relevant regulator, though.  The FDA and the states also have jurisdiction.  Read on.

Myth #2:  FDA Has Approved CBD So The Claims I’m Seeing Online Must Be Substantiated.

FDA has only approved Epidiolex for treatment of rare forms of epilepsy.  This approval does not mean that other CBD claims are approved or that FDA agrees that CBD can be lawfully used in other products.

FDA’s position is that CBD from any source is an active drug ingredient.  FDA has voiced this position in warning letters and reiterated it just last week.  The agency also highlighted its continuing concern about consumer safety and disease treatment claims featured on unapproved CBD products. Finally, FDA acknowledged the public’s growing interest in CBD’s potential therapeutic capabilities and expressed a commitment to consider whether there are circumstances in which certain cannabis-derived compounds might be permitted in a food or dietary supplement.  Although not specific to CBD, FDA announced that three hemp ingredients – hulled hemp seeds, hemp seed protein and hemp seed oil – may be legally marketed in foods under the conditions set forth in their respective GRAS notices.

Myth #3: The 2018 Farm Bill Preempts All State Laws.

On the issue of preemption, Section 10113 of the 2018 Farm Bill expressly does not preempt laws that are more stringent than those found in the Bill regarding the production of hemp. See Sec. 297B(a)(3)(A) (“No Preemption. – Nothing in this subsection preempts or limits any law of a State or Indian tribe that (i) regulates the production of hemp; and (ii) is more stringent than this subtitle.”).

However, Section 10114(b) of the 2018 Farm Bill does provide: “No State or Indian Tribe shall prohibit the transportation of shipment of hemp or hemp products produced in accordance with . . . Section 10113[] through the State or the territory of the Indian Tribe, as applicable.” Section 10114(b) thereby clearly preempts any state law prohibiting shipment of industrial hemp through a State or territory of an Indian Tribe.

It also arguably preempts any State law prohibiting the sale of industrial hemp in a State or territory of an Indian Tribe, so long as the hemp was produced (in another state) pursuant to the requirements of Section 10113. Unfortunately, it is not clear whether Section 10114(b) of the Farm Bill preempts State laws disallowing sales of industrial hemp. It will likely take litigation to decide the extent of the preemption, if any, regarding sale of industrial hemp in States which have laws disallowing such sales.  The National Conference of State Legislatures maintains a helpful chart of states that have established such programs here.

In addition, there is a patchwork of state-level product considerations.  For example, California expressly follows FDA’s position that CBD cannot be lawfully be used in foods or dietary supplements.  By contrast, New York expressly allows CBD in dietary supplements when the products meet other program requirements.  Companies should consider these types of regulations on a state-by-state and product-by-product basis.

Myth #4:  Since CBD is Legal, There Is No Risk in Selling It

While the 2018 Farm Bill provided needed clarity as to the status of industrial hemp at the federal legal, this remains murky territory.  There has been localized enforcement in many states, frequently involving confusion about the product.  Companies seeking to sell CBD should consider their specific products in conjunction with the other federal and state considerations discussed above.

The year ahead will bring more changes.  Companies should be sure to stay informed to properly evaluate the risks and opportunities.

The DEA announced last week that it is placing certain drug products that have been approved by the FDA and which contain cannabidiol (CBD) in schedule V of the Controlled Substances Act. The action places FDA-approved drugs that contain CBD derived from cannabis and no more than 0.1 percent tetrahydrocannabinols in Schedule V.

Schedule V drugs are those considered to have lower potential for abuse than drugs in Schedules I – IV.  For reference, cannabis and heroin are Schedule I, cocaine and Ritalin are Schedule II, Tylenol with codeine is Schedule III, and Xanax and Ambien are Schedule IV.

Importantly, this does not render all CBD in the Schedule V category.  DEA expressly limited the classification to FDA-approved drugs, which currently consists of just one product – Epidiolex.  Cannabis remains a Schedule I substance and cannabis-based CBD generally remains scheduled as a derivative of cannabis.

DEA’s move provides certainty for drug makers seeking to introduce a CBD drug similar to Epidiolex, but would not apply to products with greater than .1 percent tetrahydrocannabinols.