A primer for Congress on the FDA and hemp.
A new Congressional Research Service report published Friday, called “FDA’s Oversight of Hemp-Derived Compounds,” serves as a primer on the topic.
In July 2023, a handful of members of Congress issued a Request for Information (RFI) that asked for submissions from stakeholders about how best to “provide a legal pathway” for “marketing” CBD products.
(More on that RFI below. The window for that closed on Friday, and we’ve got some submissions to share.)
“Some in Congress have continued to introduce legislation that would allow for the use of hemp-derived CBD and related substances in dietary supplements and as a food additive. This issue, or aspects of it, could be debated as Congress considers reauthorization of the next farm bill,” the CRS report continues.
The report covered areas like estimates of the retail value of hemp-derived cannabinoids, which vary “but likely exceed $2 billion annually in the United States.”
The report concludes with a look at recent Congressional hearings and legislation on the topic, including H.R. 4849/S. 2451, H.R. 1628, H.R. 1629, which would allow hemp-derived CBD and hemp-derived CBD-containing substances to be marketed as dietary food additives or supplements.
RFI on CBD closed. Here’s a look at what was submitted.
• CANNRA (read the submission): The 40-page response from the Cannabis Regulators Association, a group of state cannabis regulators, is focused on the specific complexities related to the regulation of hemp-derived cannabinoid products; state regulators, the submission notes, “understand those nuances better than anyone.”
CANNRA pointed out that the 2018 Farm Bill, essentially, pushed a lot of toothpaste out of the tube, and that no one should really be talking about just CBD.
“The language in the 2018 Farm Bill effectively legalized marijuana federally, without product
regulation, and called it ‘hemp,” the submission underscored (underlining CANNRA’s), and that a “comprehensive regulatory approach that accounts for all cannabinoid hemp products is urgently needed.”
But, federal regulation shouldn’t recriminalize, CANNRA noted, and “should set a floor, not a ceiling.”
“Federal regulations should create minimum standards for cannabinoid hemp products to ensure that consumer safety and public health are protected. However, states should be able to enact regulations that extend beyond federal minimums to further protect their communities and consumers,” the submission noted, adding that in lieu of federal regulation, it’s public health that’s most at risk.
• ATACH (read the submission): The American Trade Association of Cannabis and Hemp believes that non-intoxicating products made from hemp should be under the FDA’s regulatory umbrella to “merit a federal pathway for commercialization of products and the promotion of public health and safety.”
ATACH drew a strong line between CBD and other cannabinoids. ATACH also wrote that producers should not be creating synthetic intoxicating products from CBD, because it will “cause confusion given that most consumers are often told that hemp products are not intoxicating.”
“The regulation of cannabidiol (“CBD”) should not permit intoxicating products under the guise of
CBD or add to the proliferation of the massive unregulated gray market in hemp-synthesized
intoxicants that has taken place due to the Farm Bill,” ATACH wrote.
“Instead, non-intoxicating CBD products must be distinguished from intoxicants, and a real regulatory pathway must be provided federally for CBD products, just like other products in the US intended for human consumption. Cannabinoids produced from the cannabis plant should be regulated by the final product, with standardized considerations for dietary supplements and for food and beverage.”
• Natural Products Association (read the submission): NPA highlighted much about the current market for CBD products, which is characterized by a lack of consistent regulation and safety standards. More than 3,000 CBD products have entered the market in the past five years without clear regulatory guidelines from the FDA, for example, with some mistakenly assuming that such standards are already in place.
NPA noted that “no new framework is necessary” for CBD. “With the passage of DSHEA, Congress recognized the importance of nutrition and the benefits of dietary supplements in promoting public health. Products sold as dietary supplements come with a Supplement Facts label that lists the active ingredients, the amount per serving, as well as other ingredients, such as fillers, binders, and flavorings,” NPA noted.
“The FDA has established good manufacturing practices (GMPs) that companies must follow to help ensure their dietary supplements’ identity, purity, strength, and composition. These GMPs can prevent adding the wrong ingredient or too much or too little of the correct ingredient and reduce the chance of contamination or improper packaging and labeling of a product.”
• U.S. Hemp Roundtable (read the submission): This submission focused on areas like the market dynamics related to CBD, for example, at the pathway to regulation.
The Roundtable described the whiplash, of sorts, created by the 2018 Farm Bill. Hemp was legalized, igniting a surge of interest, but then the FDA almost immediately “reasserted its opinion that it is illegal to market CBD as a dietary supplement or to use CBD as a food additive.”
“The FDA’s comments, and its failure to develop a regulatory regime, cast a cloud over the industry, causing big box stores and major food and beverage brands to abandon plans to market CBD and other hemp extracts,” the Roundtable wrote.
The Roundtable suggests that cannabinoids be regulated differently based on whether they’re intoxicating.
“There should be two separate categories within existing regulatory frameworks that distinguish
products by their potential to cause impairment. This currently exists with regard to alcohol and
the 0.5% ABV limit under which a product like kombucha can be considered food,” the Roundtable wrote. “We strongly object to banning products that are potentially intoxicating merely due to that
potential.”
Latest litigation in New York: judge maintains CAURD program pause.
This Friday is the next hearing date in the legal battle that has paused, at least partially, the Conditional Adult Use Retail Dispensary (CAURD) rollout, meant to put “justice-involved” individuals at the front of the adult use retail rollout, but things don’t look too good for the program.
On Friday, Albany County Supreme Court Judge Kevin Bryant granted a limited injunction and ordered that regulators are “enjoined from further processing, approving or investigating pending applications for CAURD licenses” with the exception of “licensees who, prior to August 7, 2023, met all requirements for licensing.” Bryant asked regulators to provide that list of eligible licensees by the end of the day tomorrow. However, he also ordered that he would consider “on a case-by-case basis” any other entities that feel they should be “exceptions to this injunction,” so long as certain documentation is provided.
Bryant also ordered regulators to “begin finalizing applicable regulations for Adult Use Cannabis Licenses as set forth in Article 4 of the MRTA.”
Bryant said, essentially, that he would hold regulators’ feet to the fire: “Given the representations by Counsel for Defendants regarding the expected imminent approval of regulations and the Board opening an application process for all identified groups set forth in the MRTA, this Court will continue to require regular appearances from counsel before the Court to provide updates and to ensure that appropriate progress is being made to ameliorate whatever impediments exist to the approval of a process that arguably will make these proceedings moot.”
Notably, Bryant considered future legal battles in coming to his decision on the injunction, writing that “it is certainly conceivable that a successful challenge to the CAURD program could result in a finding that the licenses are invalid. In this light, a denial of the injunction would be a tacit endorsement from this Court of further expenditures in reliance of a program that is potentially in legal jeopardy.”
At the heart of current the legal challenges to the CAURD program is the argument that MRTA, the adult use legislation, included the following language: “the initial adult-use cannabis retail dispensary license application period shall be opened for all applicants at the same time.”
As of now, some pieces of the CAURD program remain intact, and could potentially go on to co-exist with the forthcoming (non-conditional) adult use licensing rollout. But what remains to be seen is whether continued challenges lead to the most extreme possible outcome: the closure of licensed, operational shops.
As for how many licensees might be on regulators’ list, OCM Chief Equity Officer Damian Fagon’s affidavit, on which we reported in this newsletter last week, provides a glimpse. The numbers are a bit convoluted but lend themselves to a safe guess (emphasis on “guess”) of somewhere below 100.
“Of the total 900 individuals that applied to the conditional adult-use retail dispensary (“CAURD”) program, no more than 79 more are eligible to be approved, and those approvals are on a rolling basis that can be made a secondary priority to opening the general licensing pool,” Fagon wrote.
“There are 453 provisionally approved CAURD licensees, but only 24 have final licenses and are authorized to sell cannabis products to consumers. The remaining 429 provisionally approved CAURD licensees are in various stages of final licensure, including looking for retail locations, providing required municipal notifications, obtaining certificates of occupancy for retail spaces, obtaining required insurance policies, entering labor peace agreements, planning for renovations and outfitting their retail dispensaries in accordance with the Office’s rules, hiring personnel, and submitting any additional required documentation,” he continued.
“By January 2024, the Office anticipates that at most 100 CAURD licensees will receive their final licenses and be authorized to sell cannabis products to consumers. Of these 100 licensees, fewer than 75 are likely to be open and operational by January 2024.”
NYC Sheriff’s Office is now targeting unregulated edibles makers.
NYC Sheriff Anthony Miranda spoke during a public safety briefing on Friday, noting specifically the “crack down on the illegal sale of baked goods containing cannabis.”
This is the first time Miranda has singled out edibles in this manner, and he highlighted recent “special targeted enforcement” on unregulated shops that sold “illegal baked goods that have cannabis in them.”
“Most recently, we had the opportunity to join forces with the Department of Health, who went out to do inspections on locations that were baking with cannabis and other products. And when we went out with them, they clearly had more significant authority about closing down some of the locations,” Miranda said. “The Department of Health had a significant amount of inspection authority to go into these locations. We accompanied them about doing additional enforcement, looking for additional products that may have been sold in these locations as well. We were able to secure locations that did result in two arrests at two different locations, and the seizure of all the baked goods.”
“Community complaints are extremely important. We want to make sure that you understand that we’re hearing the complaints and we’re actively investigating those complaints. And we not only do the enforcement on the street level, but we also do follow-up investigations, tracking the financials of a particular business, and finding out where the money’s going and who’s funding these locations,” Miranda continued.
By the numbers:
In July, the Sheriff’s Office conducted enforcement actions totaling:
• Civil penalties totaling nearly $4.5 million
• More than $2 million in products seized
Year-to-date:
• $22 million in civil penalties
• More than $12 million in cannabis products seized
+ More: Read Cannabis Wire’s two scoops from last week, which cover the growing impatience in the City Council toward Mayor Eric Adam’s office over how to rein in unregulated sales, and that at least one council member proposed a public health emergency over unregulated sellers.
