The cannabidiol, or as it is more commonly known, CBD, market is currently a booming $390 million industry, and is expected to hit at least $1.3 billion by 2022. But even as the CBD boom continues, cannabis companies lack the benefit of a clear legal and regulatory framework. The passage of the 2018 Farm Bill, the Food & Drug Administration's ("FDA" or "agency") statements that CBD cannot be added to food and dietary supplements, and the confusing patchwork of state laws either permitting or prohibiting the use of CBD in foods, dietary supplements, and other types of consumer products, have all created confusion regarding its legality. This has left cannabis companies with difficult choices to make as they attempt to avoid being the subjects of a federal or state enforcement action.

Given the continued growth of the industry, this Friday, May 31, 2019, the FDA is providing companies with a forum to share scientific information on CBD that may inform a new regulatory approach and could ultimately lead to a path forward. While the public hearing may just be the first step for cannabis companies seeking to legally market CBD, it will undoubtedly set the tone for future discussions and/or negotiations between FDA and industry stakeholders.

How We Got Here

On December 20, 2018, President Donald Trump signed the Agricultural Improvement Act of 2018 ("Farm Bill"). The Farm Bill legalized hemp and hemp products (so long as the concentration of THC in the hemp does not exceed 0.3 percent), and removed "hemp" from the definition of "marijuana" in § 102(16) of the Controlled Substances Act. The Farm Bill also permitted hemp-derived constituents like CBD, a non-psychoactive cannabinoid found in hemp, to be introduced into interstate commerce.

On the same day that President Trump signed the Farm Bill, Scott Gottlieb, M.D., then FDA Commissioner), issued a statement reminding the public that:

  • The Farm Bill still permits the FDA to regulate products containing cannabis or cannabis-derived compounds under the Federal Food, Drug, and Cosmetic Act and the Public Health Service Act;
  • CBD products that claim to diagnose, cure, mitigate, treat, or prevent diseases are subject to the FDA's new drug approval process; and
  • It is illegal to introduce foods containing CBD into interstate commerce, or to market CBD products as, or in, dietary supplements since CBD is an ingredient in an FDA-approved drug. The FDA can, however, issue a regulation permitting the use of a pharmaceutical ingredient in a food or dietary supplement.

Even after the FDA's statements, state lawmakers have continued to enact CBD laws which, sometimes, contradict federal law. A 2018 Colorado law, for example, permits all parts of the hemp plant to be added to food; after initially prohibiting the use of CBD in food, Maine abruptly changed course in 2019 after three months of public outrage to authorize such use. Other states such as Ohio prohibit sales of any type of CBD to the public, and regulators in California and New York City have followed the FDA's lead in banning the use of CBD in foods.

Overall, the federal and state laws addressing CBD are inconsistent and murky, making it difficult for national cannabis companies to safely operate.

Working Towards a Solution

The FDA has recognized that many stakeholders want clarity on the legality of CBD, and has gathered information, presumably to explore options for a regulatory framework for the ingredient, particularly in foods and dietary supplements.

On April 2, 2019, Dr. Gottlieb (who resigned from the FDA in March 2019) issued a follow-up statement outlining new steps that the FDA will take to advance the agency's continued evaluation of potential regulatory pathways for the lawful marketing of cannabis and cannabis-derived products. These new steps included:

  • A public hearing on May 31, 2019 that will enable FDA to obtain scientific data and information about the safety, manufacturing, product quality, marketing, labeling, and sale of products containing cannabis or cannabis-derived compounds;
  • The formation of a high-level internal agency group to explore potential pathways for dietary supplements and/or conventional foods containing CBD to be lawfully marketed, including a consideration of what statutory or regulatory changes might be needed and what the impact of such marketing would be on the public health;
  • Updates to its webpage, FDA Regulation of Cannabis and Cannabis-Derived Products: Questions and Answers, with answers to frequently asked questions on this topic; and
  • Issuing three warning letters to companies marketing CBD products with "egregious and unfounded claims that are aimed at vulnerable populations."

Forward Steps – May 31, 2019 Public Hearing

The FDA's public hearing will allow stakeholders to provide the agency with important information on several key topics, including:

  • Safety considerations raised by the widespread use of CBD, including the cumulative exposure to CBD if people access it across a broad range of consumer products;
  • The levels of cannabis and cannabis-derived compounds that could cause safety concerns, and how these compounds could interact with other substances such as drug ingredients;
  • Whether some threshold level of CBD could be allowed in foods without undermining the drug approval process or diminishing commercial incentives for further clinical studies;
  • How the widespread commercial availability of CBD could impact the desire to develop drugs with CBD; and
  • The risk that patients could forgo medical treatment by substituting unapproved products for approved medicines used to prevent, treat, mitigate, or cure a particular disease or condition.

FDA has also established a docket for public comments at www.regulations.gov (Docket # FDA-2019-N-1482), which will remain open until July 2, 2019. To date, the docket has received over 750 comments, and we expect that number to grow following this week's public hearing. While FDA is unlikely to take any immediate action, the public hearing may provide the cannabis industry with some further indications on how it perceives CBD and CBD-related products. As we wait, one thing remains fairly clear: FDA will not hesitate to take enforcement action against cannabis companies making egregious claims that place the public health at risk.