Last week, I received a call from a publicly traded, non-U.S. company that has developed a beverage containing CBD (cannabidiol, a non-psychoactive cannabinoid in cannabis). The company plans to produce this beverage in California and distribute it to select U.S. markets. Before scaling these operations, the company wanted to understand what clearances, if any, were required by the FDA.

Many products containing CBD ingredients are already on the U.S. market, from lip balms to CBD supplement oils. Still, the FDA has never recognized CBD as Generally Regarded as Safe (GRAS) for use in food and beverages and the FDA recently concluded that CBD products are excluded from the dietary supplement definition under section 201(ff)(3)(B)(ii) of the Federal Food, Drug and Cosmetic Act (FD&C Act).

In March, we wrote about warning letters issued by FDA to six cannabis companies, some of whose products were claimed to contain CBD. In each case, the FDA found that these companies’ websites promoted their products as “intended for use in the cure, mitigation, treatment, or prevention of disease.” As such, the FDA stated that the products must be regulated as drugs under the FD&C Act.

In the warning letters, FDA did not squarely address CBD’s legal status, which itself is controversial. The Drug Enforcement Administration (DEA) considers CBD a marijuana derivative and Schedule I drug being illegally marketed in violation of the Controlled Substances Act (CSA) and the FD&C Act. In 2013, CannaVest Corp.—a publicly held manufacturer and supplier of CBD oil—obtained a public letter from a Colorado attorney Robert Hoban, who opined that “the sale, production and distribution of CBD oil/products derived from imported raw material industrial hemp is not a violation of the CSA.”

Given this confusing structure and the trend toward states legalizing cannabis to varying degrees, threatening letters from the FDA are probably less likely to be sent to companies trading in CBD that: (1) only sell their products within the states that have legalized medical marijuana, (2) do not make claims as to proven health or medical efficacy without FDA approval; and (3) generally try to comply with existing FDA rules to the extent possible.

As in all areas of the cannabis industry, compliance with these recommended practices cannot guarantee that a company will escape regulatory scrutiny, or worse. Still, a compliance strategy should decrease risk exposure, including from truth-in-advertising claims brought by consumers. It also helps companies prepare for standard regulatory oversight that we hope to see soon from agencies like the FDA.

– Vince Sliwoski, for the Canna Law Blog

Attorney with Harris Moure