Cannabis Industry News Alert

The U.S. Food and Drug Administration (FDA) sent a shot across the bow of the cannabidiol (CBD) industry on November 25. The FDA disclosed that it issued warning letters to 15 companies “for illegally selling products containing [CBD] in ways that violate the Federal Food, Drug, and Cosmetic Act (FD&C Act),” and noted that it published “a revised Consumer Update detailing safety concerns about CBD products more broadly.” So, what does this mean for the industry?

These warning letters follow similar letters issued by the FDA and Federal Trade Commission (FTC) earlier this year, which we have discussed extensively in previous blog posts (here and here). Like the previous letters, the 15 new warning letters were issued to companies marketing CBD products as dietary supplements or treatments for serious illnesses, or selling food products to which CBD had been added.

The FDA echoed its concern with “unproven medical claims” regarding CBD in its consumer update, explaining that such claims can “lead consumers to put off getting important medical care.” The FDA also noted the additional risk to consumers posed by inadequate manufacturing controls, which can result in products containing unsafe contaminants or a different amount of CBD than the amount listed in their labels. And the FDA reaffirmed that CBD cannot be added to human or animal foods or items marketed as foods (such as flavored tinctures marketed as “great tasting”).

Is this the beginning of the end of the CBD industry? Probably not. While the FDA’s decision to simultaneously send 15 warning letters and publish a consumer update signals that the agency is closely watching the industry, the FDA essentially just doubled-down on its existing CBD guidance. Further, the FDA explained that its actions “come as the FDA continues to explore potential pathways for various types of CBD products to be lawfully marketed,” indicating that more fulsome regulatory guidance regarding CBD should be coming soon (we expect such guidance by the beginning of 2020). But given this recent enforcement spree, CBD companies would be well advised to thoroughly review their marketing and manufacturing processes and consult counsel regarding methods for mitigating their risk.