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Within hours of passage of the 2018 Farm Bill, the FDA Commissioner released a long statement reiterating his agency's authority to regulate CBD and THC products. In so doing he issued a rebuke to the medical marijuana industry, reminding them that therapeutic claims without evidence are not permitted. Gottlieb offered some hope for consideration of regulatory approval pathways for CBD and THC additives in food. A public meeting is planned but he offered little detail on a timing. Industrial hemp and its CBD and THC products may be off Schedule I but they are still firmly in the FDA's regulatory grasp and will be regulated as a drug for the foreseeable future. The FDA's approach fits nicely into CRON's business model. Call the Shayne Laidlaw and Howard Penny on the Cannabis desk to learn more. |
Within hours of President Trump signing the 2018 Farm Bill, FDA Commissioner Scott Gottlieb issued a statement that said, loosely translated from the bureaucratic-ese:
“Not so fast, cannabis industry. Congress left us in charge of regulating CBD and THC and that we shall do.”
As we pointed out when the final conference report was issued, the Agricultural Improvement Act of 2018, more popularly known as the Farm Bill, explicitly preserved the FDAs current authority to regulate products containing cannabis or cannabis-derived compounds.
In the wake of the bill signing last night, Commissioner Gottlieb felt it was necessary to clarify that authority, “In short, we treat products containing cannabis or cannabis-derived compounds as we do any other FDA-regulated products – meaning they are subject to the same authorities and requirements as FDA-regulated products containing any other type of substance.”
Why did Commissioner Gottlieb feel the need to clarify his authority?
The industry, and certainly the expectations of investors, has gotten a good bit ahead of regulation. “We are concerned at the number of drug claims being made about products not-approved by the FDA that claim to contain CBD or other cannabis-derived compounds.” Gottlieb goes on to point out that it is unlawful to introduce food containing added CBD or THC product into interstate commerce, or to market CBD or THC products as, or in, dietary supplements.
The FDA plans to continue to enforce against companies that violate the law.
You will not be enjoying a CBD-infused Coors in Connecticut that was brewed in Colorado for some time.
Gottlieb isn’t all grinchy. The statement also includes an announcement that the FDA will hold a public meeting “in the near future” to discuss lawful pathways by which products containing cannabis or cannabis-derived compounds can be marketed and sold across state lines in food and dietary supplements. Doing so, the FDA suggests, would require them to continue to treat cannabis-derived additives as pharmaceuticals.
Unfortunately, “the near future” in government-land can mean anywhere from six weeks, to six months or more. The development of regulation that would permit cannabis or cannabis-derived products to be added to food, drink or dietary supplements as a pharmaceutical and thus permitted to travel across state lines could take another year or more and may not happen at all.
Gottlieb points out in his statement that approving cannabis-derived products in food or dietary supplements would require compliance with all other provisions of the Food, Drug and Cosmetic Act. They apparently had not fully researched the possibility of permitting such a practice and have left themselves room to reverse course on this commitment if necessary.
Complicating the timeline is the partial government shutdown of the government over funding for a border wall. About 40 percent of the FDA’s employees will be furloughed until the funding issues are resolved. The last major shutdown, which affected the entire government, delayed routine rulemaking at CMS by 3 months.
Gottlieb also announced that certain hemp-derived products that do not contain CBD or THC would now be classified as Generally Recognized as Safe (GRAS) and can be added to food and beverage products.
Those in the cannabis industry that saw the Farm Bill as a significant step forward are right. It is the pace of change they may not be quite prepared to accept. Developing a regulatory pathway for approval of certain cannabis and cannabis-derived products that conforms to the Food, Drug and Cosmetic Act could take years.
While the cannabis industry seems convinced opinion on de-control or even full legalization is uniform, the fact is that public health, safety and law enforcement officials remain skeptical. They get a seat at the table as the FDA tries to accommodate regulation that permits some use of THC and CBD.
Finally, even as the federal government relaxes the laws around products with CDB and THC they are doing so using traditional pathways for drugs. Drugs require some clinical evidence of efficacy and safety before they are cleared by the FDA. To date there is precious little evidence beyond anecdotes to support the myriad claims associated with CBD and THC, the four drugs approved by the FDA being the exception.
The Farm Bill will permit more research into the therapeutic benefits of cannabis-derived products, which in turn should make the FDA’s regulation of THC and CBD as drugs more efficient. It will also put more scrutiny on producers making medical claims unsubstantiated by evidence.
As part of its regulation of CBD and THC as a drug, the FDA will review and monitor manufacturing process and facilities. As any holder of Invacare and Zimmer know, the FDA is quite serious about safeguarding public health through careful monitoring of the manufacture of medical items and services.
Being regulated means the cannabis industry will have to be organized, efficient and sophisticated enough to seek and obtain the necessary approvals while managing their production safely. The Cannabis team recently went on a field trip to CRON's Stayner, ON facility and found confirmation of the company's sophitication. (Contact Sales@Hedgeye.com for access to our Cannabis sector)
As a purely recreational activity, CBD and THC consumption will have to wait for Congress to Act.
Call me, Shayne Laidlaw or Howard Penny over on the Cannabis desk with questions.
Emily Evans
Managing Director – Health Policy
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