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Fast Growing CBD Market Continues To Create Regulatory Challenges and Litigation Opportunity

April 13, 2021

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CBD and CBD-containing products are ubiquitous, yet there is significant misunderstanding about their regulatory status. CBD is cannabidiol, one of more than a hundred different active compounds that can be derived from the hemp plant. The 2018 Farm Bill changed the legal status of hemp, separating it from the Schedule 1 substance known as “marihuana” under the Controlled Substances Act. The effect was to decriminalize the plant that meets the definition of hemp, as well as its derivatives. But, as the Food and Drug Administration (FDA) was quick to point out just hours after the President signed the bill, FDA’s requirements relating to food, beverages, dietary supplements, cosmetics and other products regulated by the federal Food Drug and Cosmetic Act (FD&C Act) were not modified.

From a regulatory perspective, 2020 was “more of the same” from FDA. FDA continues to seek public input on the regulation of CBD, but has

California Prop. 65 Warning Requirement for THC Makes CBD, Hemp and Cannabis Products a Target

The California Proposition 65 warning requirement for THC took effect on January 3, making cannabis, hemp and CBD products a likely target for private enforcement actions.

Although under federal law CBD products are allowed to contain up to 0.3 percent THC, or Δ9-Tetrahydrocannabinol, no safe harbor level of exposure to THC has been established under Prop. 65.  That means private enforcers can argue that any detectable amount can subject a product to the Prop. 65 warning requirement.  Companies can work with consultants to develop a safe use determination for THC, but until it is established and accepted, enforcement actions will be a material risk.  Notably, the Prop. 65 listing applies to Δ9-THC, although the Prop. 65 requirements may still be triggered by residual Δ9-THC present in other THC products, like Δ8-THC distillates.

At the same time that THC was added to the Prop. 65 list, California’s Office of Environmental Health

FDA Reaches Voluntary Agreement with Manufacturers to Phase Out Certain Short-Chain PFAS in Food Packaging

The U.S. Food and Drug Administration has announced that manufacturers of certain per- and polyfluoroalkyl substances (PFAS) used for grease proofing in paper and paperboard for food packaging (for example, as coatings on some fast food wrappers, to-go boxes, and pizza boxes) have voluntarily agreed to phase out sales of these substances for use as food contact substances in the United States, following new analyses of data raising questions about potential human health risks from chronic dietary exposure.

Starting in January 2021, three manufacturers will begin a three-year phase out of their sales of certain substances that contain 6:2 FTOH for use as food contact substances in the U.S. marketplace.  It may take up to 18 months after the phase-out period to exhaust existing stocks of paper and paperboard products containing these food contact substances from the market. A fourth manufacturer informed the

FDA Extends Enforcement of New Nutrition Facts Label Another 6 Months

Although January 1, 2020 was the deadline for many companies to implement the new Nutrition Facts label, the FDA states on its Industry Resources on the Changes to the Nutrition Facts Label web page that it will not take any enforcement actions for the first six months, or until after July 1, 2020.

The FDA initially set a general compliance date of July 2018. Manufacturers with annual food sales of less than $10 million were given an additional year to comply. In May 2018, the FDA extended those compliance dates “by approximately 1.5 years.”

The FDA has provided the following example illustrating what’s different about the new Nutrition Facts label:

Importantly, the new label requires:

  • Declarations for “added sugars” in grams and as a percentage of Daily Value

Congress Presses FDA to Act on CBD Regulations

Following statements by the U.S. Food and Drug Administration that cannabidoil (CBD) in food and beverage products remains illegal, and amid the patchwork of state laws and enforcement actions, a group of U.S. lawmakers, led by Reps. Chellie Pingree (D-Maine) and James Comer (R-Ky.), have urged the FDA to “quickly adopt a policy of enforcement discretion and to consider issuing an interim final rule to regulate CBD as a dietary supplement and food additive while simultaneously moving forward with a robust framework for evaluating the safety and accurate labeling of these products.” The letter stated that the agency’s “current regulatory posture on CBD has created significant regulatory and legal uncertainty for participants in this quickly evolving industry. We are discouraged by FDA’s estimation that a rulemaking process could span 3 to 5 years. We believe there are more expeditious measures that FDA could take that would establish regulatory

FTC Warns Companies Against Advertising CBD Products as Treating or Curing Diseases

The U.S. Federal Trade Commission has announced that it sent warning letters to three companies that sell “oils, tinctures, capsules, ‘gummies,’ and creams containing cannabidiol (CBD),” a chemical compound derived from the cannabis plant. The letters warn the companies, which have not been identified, that “it is illegal to advertise that a product can prevent, treat, or cure human disease without competent and reliable scientific evidence to support such claims.”

The FTC states that each company marketed its CBD products as being able to “treat or cure serious disease and health conditions,” such as relieving “’even the most agonizing pain’ better than prescription opioid painkillers,” or treating cancer, Alzheimer’s disease, multiple sclerosis (MS), fibromyalgia, cigarette addiction, colitis, schizophrenia, anxiety, depression, Lou Gehrig’s Disease (ALS), stroke, Parkinson’s disease, epilepsy, traumatic brain injuries, diabetes, Crohn’s disease, psoriasis, and AIDS.

In the letters, the FTC urges the companies to review all

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