Seyfarth Synopsis: CBD is "thriving" in the current regulatory environment, but is it doing so illegally?
As former U.S. Food and Drug Administration (FDA) Commissioner Scott Gottlieb opined last week, "the CBD craze is getting out of hand. The FDA needs to act." Since the passage of the Farm Bill in December of 2018, there has been a marked uptick in interest in the cannabidiol (CBD) space from businesses and users alike. Congress explicitly preserved the FDA's authority to regulate CBD-containing products to ensure that they are safe and that their claims are valid. Current federal law expressly allows for the distribution of hemp-derived CBD products that contain 0.3% tetrahydrocannabidiol (THC) or less to be sold, with certain caveats. The FDA has provided clarity that hulled hemp seed, hemp protein powder, and hemp seed oil can be legally used in foods. Other CBD products, however, are still subject to various state law regulations as well as the U.S. Food, Drug, and Cosmetic Act (FD&C Act), which requires FDA pre-market approval for drug products. Currently, the FDA treats CBD products aimed at human or animal consumption as drugs and therefore they cannot be distributed without prior approval or a rulemaking exception (more on this below). The following is a brief update on recent developments within the federal regulatory regime of CBD products.
FDA's Regulatory Efforts
In light of the enactment of the Farm Bill, along with growing activity and interest in CBD products, the FDA has taken initial steps toward exercising greater oversight—with a goal of devising a more robust regulatory regime. In March of 2019, the FDA established a Working Group to determine the possible legislative pathways to regulate CBD. Specifically, the group aims to "make recommendations" on CBD legislation to Congress.
On May 31, 2019, the FDA's Working Group held a public hearing for stakeholders to share their experiences and challenges with CBD products, including information and views related to product safety. The public hearing attracted over 100 speakers and 2000 participants. In addition, the Working Group invited the public to submit written comments (the "Public Docket"), which closed on July 16, 2019. Dr. Amy Abernethy, the Principal Deputy Commissioner and Acting Chief Information Officer and head of the Working Group, recently Tweeted:
"We are enthusiastic about research into the therapeutic benefits of CBD products but also need to balance safety. To understand the breadth of issues and gather data on safety we have conducted a public hearing, reviewed the medical literature, and have an open public docket."
Elaborating on this statement, on July 25, 2019, Dr. Abernethy testified before the Agriculture, Nutrition and Forestry Committee where she stated that providing clarity on the regulatory status of CBD products is an FDA priority, but cautioning that based on the FDA's review of Epidiolex (the first CBD-approved drug), CBD is not risk-free. She stressed that, to the FDA's knowledge, adequate studies simply have not been done, leaving the FDA without adequate information for science-based decision-making about CBD. The FDA is collecting data to fill these gaps. The Working Group is in the process of reviewing published medical literature and other available information from industry sponsors. In addition, as of July 29, 2019, the FDA received over 4400 comments on the Public Docket, which will add to the Working Group's active review. The FDA is also meeting with other federal agencies and state counterparts, trade organizations, and patient groups in a quest for data.
The FDA is living up to its previous statement that it would apply both a "rigorous and science-based approach" to formulating its regulations on CBD products. And now, it appears, based on Dr. Abernethy's public comments, the FDA is primed to roll out a report on its progress later this summer or early fall.
FDA's Enforcement Efforts
Meanwhile, the FDA is seeking opportunities to provide regulatory clarity wherever possible. In 2019, the FDA issued warning letters to four companies marketing and selling CBD products. In each instance, the companies were selling products with flagrant disease-related claims that the FDA had not approved for the treatment or prevention of any ailments. The FDA has historically been passive in its oversight of CBD products. The recent shift underscores the need for companies to both understand and adhere to federal regulations over such products.
In its most recent warning letter, dated July 22, 2019, the FDA asserted that Curaleaf Inc., (based in Wakefield, Massachusetts) marketed unapproved products that qualified as "drugs" with improper labeling as defined under the FD&C Act. The FDA explained that Curaleaf's products, advertised both through its online store and on social media sites, were aimed at the "diagnosis, cure, mitigation, treatment, or prevention of disease and/or intended to affect the structure or any function of the body." The FDA specifically found that Curaleaf marketed its CBD products online with unsubstantiated claims that they treated (among other things) cancer, opioid withdrawal, pain and pet anxiety, and Alzheimer's disease. For example, on one of Curaleaf's pages entitled "How to Use CBD Oil for Anxiety," the company explains that "CBD can successfully reduce anxiety symptoms, both alone and in conjunction with other treatments" and that "CBD oil can be used in a variety of ways to help with chronic anxiety."
The FDA requested that, within fifteen working days, Curaleaf respond with the specific steps it has taken to remedy the violations. The FDA cautioned that, without prompt action, legal action may follow, including seizure and injunctions. On Friday, July 26, 2019, Curaleaf responded, noting that it has taken steps to review all inaccurate statements about CBD products from their websites and social media platforms. It has since removed from its site the specific offending statements previously identified by the FDA. CVS, one of the nation's largest drugstore chains, has also removed Curaleaf products (CDB lotion and transdermal patches) from its shelves.
The Working Group is continuing to collect and review information relevant to the science of CBD, as well as investigating possible pathways for regulating CBD. Under section 331(ll) of the FD&C Act (21 U.S.C. 331(ll)), the FDA prohibits the sale of products containing an ingredient that has been treated as a drug or involved in clinical trials, without prior FDA approval. This requirement is not without exceptions—some of which explicitly apply to CBD or could apply to CBD. One such exemption is that the drug was marketed in food before any approval and before substantial clinical investigations involving the ingredient were instituted. Another exemption exists if "the Secretary, in the Secretary's discretion, has issued a regulation, after notice and comment, approving the use of such drug or such biological product in the food." Accordingly, the Secretary of Health and Human Services could exercise his authority and expedite the pathway for use of CBD in food products; although, any proposed regulation would take time to draft and be subject to public comment. The FDA won't have to get too creative in finding a legal way to permit the use of CBD in food products, but any such action will have to wait until the Working Group has gathered enough science to inform its decision on the safety of CBD.
In addition to the anticipated FDA regulations and further guidance on CBD, activity at both the state and federal level add another layer of complexity that companies should consider. Both states and Congress are taking active measures to promote increased regulation of cosmetics and, on the other side, seeking to deregulate cannabis, which may consequentially affect CBD products. Increasingly fragmented state laws regarding marijuana and related products will further pressure the FDA to respond to confusion in this space. As for Congress, pending pieces of legislation aim to provide, more generally, stricter guidance on cosmetics and personal care products ingredients, labeling, and testing.
Two key pieces of legislation, one from each chamber of Congress, deserve attention, primarily for topical CBD products. First, Sens. Dianne Feinstein and Susan Collins reintroduced their " Personal Care Products Safety Act" (S. 726) in March of 2019. This Act would amend the 80-year-old FD&C Act in a variety of ways, including, but not limited to: requiring the FDA to review ingredients and other non-functional constituents for safety at a rate of at least five ingredients per year; requiring cosmetic ingredient statements for all cosmetics and fragrances, including the range of possible amounts of each ingredient; requiring ingredients, warnings and statements on professional products; and requiring complete label information (including manufacturer contact information) to be made available online in connection with online sales.
Second, Representative Jan Schakowsky's pending bill entitled the " Safe Cosmetics and Personal Care Products Act of 2018" (HR 6903) likewise aims to amend the FD&C Act. While the bill is currently under review by several committees, it aims to require disclosure of all ingredients in beauty and personal care products, including fragrances. It also aims to outright ban toxic substances (e.g., carcinogens) from such products. The House, in June of 2019, has also set aside funds to further aid the FDA in setting guidelines for CDB products.
To further complicate matters, there has been a flurry of activity at the state level. Governor Andrew Cuomo of New York, for example, in July of 2019, signed into law a bill decriminalizing marijuana. Hawaii has also done so in the same timeframe. These are just two additional examples of a patchwork of states that have legalized marijuana usage. With such activity at both the state and federal level, CBD finds itself in a unique, complicated legal environment, which we continue to monitor.
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