Ever since the U.S. Food and Drug Administration (F.D.A.) removed hemp from the Controlled Substances Act in 2018, food and beverage products containing cannabidiol (C.B.D.) have exploded onto the market. Despite this change and the booming market for these products, it remains illegal to introduce food containing added C.B.D. into interstate commerce or to market C.B.D. as a dietary supplement. This strange paradox of C.B.D.’s popularity but illegality provides a confusing marketplace and future that is indicative of the entire cannabis industry.
“Under F.D.A.’s law it can no longer be used as a food or dietary supplement because of that particular activity,” said Kathleen Sanzo, a partner and F.D.A. practice group leader for the law firm Morgan Lewis, at the Trends and Innovations Seminar sponsored by Sosland Publishing Company and organized by Food Business News. “What F.D.A. doesn’t object to is the use of hemp seed oil in food. The same day it issued its policy statement around the regulatory status of C.B.D., it also approved hemp seed oil as being generally recognized as safe.”
C.B.D. is the non-psychoactive component of cannabis derived from hemp, unlike its better-known counterpart tetrahydrocannabinol (T.H.C.), which provides the high that cannabis is known for. Even though hemp is no longer considered a controlled substance, the F.D.A. approved C.B.D. as an ingredient in drug products. Under the Federal Food, Drug and Cosmetic Act, this prohibits C.B.D. from use in food and beverages.
“The situation seems to be changing day to day,” Ms. Sanzo said. “It is both at the state and local level where authorities are running around saying you can’t sell food with C.B.D. because it’s an unsafe food additive. New York City is a perfect example. You have to maintain your current knowledge around state laws because that is where all of the action is.”
This fact has not stopped the food industry from tapping into C.B.D.’s popularity. It has been attributed to mood enhancement as well as stress, tension and pain relief with minimal research confirming its effectiveness. Despite this lack of research, consumers are keen to incorporate the substance into their daily life through food, beverage, dietary supplements or even beauty products.
In a study of U.S. trends in 2019, HealthFocus found that 53% of consumers were extremely interested in C.B.D. oil. A survey by the investment firm Cowen found that 6.9% of consumers have tried C.B.D. as a supplement. The Wall Street Journal reported that market research firm New Frontier Data estimated sales of C.B.D. products in the United States tripled between 2014 and 2017 to $367 million.
“That’s a market,” said Justin Singer, co-founder and chief executive officer of Stillwater Brands, at the Trends and Innovations Seminar. “I truly believe C.B.D. and other cannabinoids are an exceptionally promising class of bioactives, but if that is true then we need less optimism and more skepticism.”
The lack of regulation from the F.D.A., ever-changing state and local laws and C.B.D.’s popularity with consumers has created a Wild West marketplace. In a vacuum of standardization, consumers are at the mercy of suppliers and producers.
“People are using words that mean many different things,” Mr. Singer said. “Without good standards of identity, you can’t have a scientific conversation.”
Cannabis and hemp, he explained, are derived from the same plant — cannabis sativa. The difference is in the T.H.C. concentration. Cannabis grown for medicinal or recreational purposes contains T.H.C. concentrations greater than 0.3% by dry weight, while hemp is less than 0.3%. Within cannabis sativa, cannabinoids and terpenes are the major chemical constituents. T.H.C. and C.B.D. are 2 of 113 bioactive compounds that make up cannabinoids.
After that, extracting C.B.D. from hemp is a complicated process that takes refining.
“I think people, in their minds, confuse the process of deriving hemp seed oil versus C.B.D. oil,” Mr. Singer said. “The analog of hemp seed oil is olive oil. It’s an expeller process … C.B.D. requires much more control. It actually requires a great deal of effort to get down to the target product.”
It’s important for bakers and snack manufacturers to understand what they are looking for in C.B.D. ingredients and are getting them from a reputable supplier.
“C.B.D. is a new supply chain from seed to sale,” Mr. Singer cautioned. “It is sorely lacking in a lot of areas. You are used to having an infrastructure; you are used to being able to trust what people tell you. Stop that.”
In an effort to curb this and move toward oversight, the F.D.A. is acting on its regulatory powers over C.B.D. products. This spring, the F.D.A. sent warning letters to three companies marketing C.B.D. products with what the agency deemed were “egregious and unfounded claims that are aimed at vulnerable populations.”
Among the offending claims were that C.B.D. stopped multiple varieties of cancer cells, slowed the progression of Alzheimer’s disease, effectively treated substance abuse disorders and reduced withdrawal symptoms.
“I believe these are egregious, over-the-line claims, and we won’t tolerate this kind of deceptive marketing to vulnerable patients,” said Scott Gottlieb, M.D., former commissioner of the F.D.A. “The F.D.A. continues to be concerned about the proliferation of egregious medical claims being made about products asserting to contain C.B.D. that haven’t been approved by the F.D.A., such as the products and companies receiving warning letters today.”
While the F.D.A. may have tied up C.B.D. in food and beverage, the agency has scheduled a May 31, 2020, public hearing on how C.B.D. products may be marketed legally.
“The agency has and will continue to monitor the marketplace and take enforcement action as needed to protect the public health against companies illegally selling cannabis and cannabis-derived products that can put consumers at risk and are being marketed and distributed in violation of F.D.A.’s authorities,” Dr. Gottlieb said.
As the F.D.A. processes comments from industry players and the public, the agency will begin fencing in the C.B.D. food and beverage market.