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FDA Playing Catch-Up As Growers and Manufacturers Wait to See How CBD Will Be Regulated

In December of 2018, Congress passed the farm bill, which, among other things, broadened the ways in which hemp can be cultivated and transported. While hemp can be used to create a variety of products, the market for cannabidiol, a hemp extract commonly known as CBD, is attracting the most attention by far. CBD is said to promote relaxation without the psychoactive effects of the THC compound found in marijuana, and manufacturers have been adding the compound to everything from beverages to shampoo since the bill passed. However, CBD’s inclusion as a key ingredient in a drug that the FDA has already approved, coupled with questions about whether to consider it a dietary supplement or a drug has slowed the regulatory response, illustrating what can happen when a market is created or legalized before regulatory structures are in place to govern it. Manufacturers and producers are waiting to hear how the FDA will police the CBD market as they prepare to take advantage of a potentially lucrative opportunity.

The 2018 farm bill allows for the broad cultivation of hemp and permits the transfer of products derived from hemp across state lines for commercial and other purposes. This means that CBD that’s derived from hemp (not cannabis) can be legally shipped between states with some restrictions. Once the bill was signed into law, the FDA quickly pointed out that they had the authority to regulate the CBD market because they had recently approved the first CBD-based drug—an epilepsy treatment called Epidiolex. However, prescription drugs are regulated much more tightly than dietary supplements, and with CBD being used in food, beverages and cosmetics, it’s not clear that the compound sits firmly in one category or another.

One major problem that the FDA must wrestle with is the fact that thousands of CBD-containing products are already on store shelves. CBD oils are readily available on Amazon and CVS began selling CBD products in March as part of a distribution deal with a company called Curaleaf. Should CBD be classified as a drug, these products would need to be removed from the market and subjected to the same lengthy, thorough review experienced by Epidiolex. While this seems increasingly unlikely, the FDA is in fact targeting products that make potentially false claims about the benefits of their CBD-containing products. Manufacturers who claim that their products cure certain diseases or otherwise provide medical benefits will face increased scrutiny even though the administration hasn’t finalized its regulations. The FDA has also made it clear that CBD cannot be added to food and beverages, and states including New York and Maine have mandated that CBD-infused food and beverage products be pulled from shelves. With so many CBD products already available in stores and online, it’s unclear how the administration will keep up their policing efforts. For now, the exploding demand for CBD has swiftly overwhelmed the FDA’s capacity to police it.

In response to this challenging combination of high demand and regulatory uncertainty, CBD producers and manufacturers are clamoring for FDA guidance on what they can sell and how they can sell it. While the FDA was initially very clear that they had the authority to police the CBD market, what’s less clear is how exactly they plan to do it. Several states have interpreted the FDA’s initial statement on their own, while in January several lawmakers involved with crafting the 2018 farm bill formally asked the FDA to clarify how they plan to regulate CBD. All of this has been complicated by FDA commissioner Scott Gottlieb’s resignation announcement in March, and the fact that regulations can sometimes take years to formalize. How Gottlieb prepares his successor could have a major impact on how the FDA moves forward after his departure. Meanwhile, more and more CBD products are appearing in the market.

Commissioner Gottlieb appeared before the House Appropriations Committee in February, where he said that a public meeting has been planned for this month to start the process of developing new rules to regulate CBD. Unfortunately, the murkiness of CBD’s classification and the fact it’s very rare for a medicine and a food or dietary supplement to contain the same ingredient could result in a long, slow process. One possibility is that the FDA will designate hemp extracts, including CBD, as “generally recognized as safe,” which would place it in the same category as other common food ingredients like vanilla extract or salt. Gottlieb, for his part, has offered that perhaps products with high concentrations of CBD should be required to meet the more strict regulatory requirements for drugs, while less potent products can be regulated as dietary supplements.

However much progress is made in this month’s meetings, the FDA’s final decisions have the potential to impact thousands of products and businesses. Particularly given the high demand for CBD and its potential for various applications, the debate about this compound—its value, classification and efficacy—is far from over.

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