Jessica Wasserman, Partner
Fasten your seat belts for the next stretch of the road toward fully national sales of hemp-derived CBD products. We predict that those who move quickly to meet first in class dietary supplement and food safety standards, as required by the Food and Drug Administration (“FDA”), will be the long-term winners in the national marketplace.
The 2018 Farm Bill was signed into law in December removing hemp and its extracts, cannabinoids and derivatives from the Drug Enforcement Agency’s list of controlled substances under the Controlled Substances Act. So long as the THC level in hemp-derived CBD products is at or below 0.3%, federally regulated institutions, such as pharmacies, banks, credit card companies and ecommerce sites now have a pathway for operations in the space. This is a watershed for the hemp industry moving us to the next phase, where there will be both opportunities and challenges.
The new set of challenges stems from the regulatory oversight of the Food and Drug Administration, which regulates food and dietary supplements. Food and dietary supplements, which according to the FDA, would include CBD products, cannot be marketed without FDA acceptance of the safety of the dietary supplement ingredient or food additive.
Hemp CBD companies would be lining up at FDA to gain these approvals but there is a hitch: for now, FDA’s position is that CBD has already been approved as a drug (Epidiolex) and so the same “article” cannot be a food additive or dietary supplement ingredient. The FDA will likely soften its position over time, but not immediately.
In this fluid environment, hemp-derived CBD companies should start the process of establishing and documenting food and dietary supplement safety according to FDA requirements as they are now. Food and supplement safety should be these companies’ highest priority.
In order to do so, CBD companies would take the following steps:
Begin the process of establishing the safety of the product by taking the steps to meet FDA’s requirement for “Generally Recognized as Safe” (GRAS). Establishing GRAS is a process that typically takes about 18 months to complete. The company must: 1) develop a science dossier of publicly available information showing that there is a consensus in the scientific community around safety for the specific use; 2) if needed, obtain a toxicology lab study; 3) convene an expert science panel. This is basis for FDA GRAS.
Establish Good Manufacturing Practices (“GMP”) product quality practices. FDA will require that CBD dietary ingredient suppliers and CBD food companies establish cGMPs (“Part 117”) and manufacturers of finished products (“Part 111”) according to the FDA requirements.
Greenspoon Marder can work with hemp CBD companies to take these important steps toward being first in class and ready for the national marketplace.
About Greenspoon Marder
Greenspoon Marder is a national full-service business law firm with more than 200 attorneys and 24 locations across the United States. Since our inception in 1981, our firm has been committed to providing excellent client service through our cross-disciplinary, client-team approach. Our mission is to understand the challenges that our clients face, build collaborative relationships, and craft creative solutions designed and executed with long-term strategic goals in mind. We serve Fortune 500, middle-market public and private companies, start-ups, emerging businesses, individuals and entrepreneurs nationwide.
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