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Outlook: All eyes on FDA as food and supplement makers await regulatory pathway for CBD

08 October 2019 Jonathan Pegg

Congress did give the agency a nudge with new funding for research and a call for the agency to develop an enforcement discretion policy, but stakeholders are still waiting to hear FDA's timetable for action. FDA, however, has shown no signs it will be rushed into finding a regulatory route for CBD foods and supplements.

The agency has repeatedly said CBD cannot be added to foods or sold as a supplement because it was approved 2018 as the active ingredient in Epidiolex, a drug used to treat childhood epilepsy. The agency says that permitting such uses would require it to carve out an exception under the Federal Food, Drug, and Cosmetic Act (FDCA), a regulatory process that would take several years to complete. That timeframe is frustrating for supplement manufacturers and food companies eager to cash in on the booming market for CBD products. US consumers bought more than $200 million CBD supplements, ointments and infused foods and beverages last year, and the market is predicted to top more than $1.5 billion by 2025.

Nearly 25% of American adults - more than 60 million - have tried CBD and found it effective for pain, anxiety and other ailments, according to a 2018 survey by Consumer Reports. The position prohibits interstate sales of CBD foods and supplements, but several states - including Colorado, Maine, and Oregon have legalized CBD as a food and supplement ingredient - while others are following the federal agency's lead and prohibiting such uses or turning a blind eye. Food and supplement manufacturers see federal rules as critical to the future of the CBD industry, arguing the existing patchwork of rules is encouraging bad actors, endangering consumers and precluding them from a lucrative market. "There is clearly consumer confusion - there is a lot of uncertainty all around and that looks likely to continue," said Brian Ronholm, senior director of regulatory policy at Wilson, Sonsini Goodrick & Rosati. "The heavy lifting is going to be done by FDA and who knows how long that will take."

No special rules

FDA officials have repeatedly said the bar for an exemption to allow CBD use in foods and supplements is high and contend they need more data before moving forward with a potential rulemaking. "There's still much we don't know - about the consequences of long-term use, about the risks to vulnerable populations, and lots more," FDA Principal Associate Commissioner Lowell Schiller, the co-chair of FDA's CBD working group, said in Nov. 7 remarks at the Council for Responsible Nutrition's (CRN) annual conference in Carlsbad, Calif. "As we continue to work as rapidly as possible to figure out how to address this popular ingredient that until very recently was a controlled substance, it's important to remember that there are no special rules for CBD."

"Congress didn't put CBD in a special new class of products, subject to a special set of rules," Schiller added. "Under the framework recognized and preserved in the Farm Bill, we look at an FDA-regulated product containing CBD the same way as we would look at an FDA-regulated product containing any other substance. We apply the same tools and authorities and statutory provisions." But critics say FDA's approach ignores the threats to consumers and problems for manufacturers from a patchwork of rules. "Right now, different states have different rules and there is inconsistency," said Jonathan Havens, a partner with Saul Ewing Arnstein & Lehr. "I understand FDA's challenge. The FDA is not a public pressure agency, they are a public interest agency charged with protecting the public health. But the reality is this is a really big market and from a safety perspective, you want uniform standards."

The agency has effectively ignored the vast majority of CBD supplements and foods on the market and has only sent warning letters to CBD companies making overt therapeutic claims. The agency sent out 15 warning letters in late November, reiterating its concerns about the lack of CBD safety data and its policy that CBD is not Generally Recognized as Safe (GRAS) for use in human or animal food. FDA has also stepped up its warnings about the potential risks from CBD, telling consumers in a November alert that the limited data it has reviewed show "CBD has the potential to harm you, and harm can happen even before you become aware of it." FDA seems to be signaling to consumers "that they really view this product as unsafe, that they don't have enough data to make confident of its safety," said Jessica Wasserman, a partner in the Cannabis Law Group at Greenspoon Marder LLP. "Therefore, they can't bless it in any way, even at a certain dosage.

It seems like things are going to continue as they are." "I'm a little critical of FDA on this," Wasserman said, adding the agency is "scaring consumers" but ignoring the booming market for CBD products. "They always say 'safety first,' but this current situation is unsafe and they aren't showing any urgency," she said. Wasserman added that FDA's current policy also precludes supplement manufacturers from submitting New Dietary Ingredient notifications, but suggested the agency may have a more favorable view CBD as a supplement rather than a food ingredient.

The restatement that CBD is not GRAS "signals they are very uncomfortable with CBD in food," she said. Havens echoed the view that FDA may ultimately look more favorably on CBD supplements than foods, noting the agency's policy is that adding CBD to foods is a "prohibited act." By contrast, the agency says that CBD currently "doesn't meet the definition of a supplement," he said, and that the companies it has issued warning letters to have made "exaggerated health claims" on their products.

If the agency went after a company for "merely selling a CBD supplement, I question whether FDC could win in a court case," Havens said. FDA's policy does not appear aligned with the booming CBD market as "consumer demand for CBD continues to grow rapidly despite the lack of regulatory clarity," said Peter Matz, director of food and health policy for the Food Marketing Institute. Matz said his group's members - food retailers - are "confused about which CBD products can be sold legally and where" and also unsure about labeling requirements and quality standards.

"However, the bigger concern here is public health and safety in an unregulated CBD market," Matz said. "The absence of a clear pathway to market for these products means consumers currently face a variety of risks, from unsubstantiated health and benefit claims, to a lack of standardization in product labeling and packaging, to products that may not contain the ingredients they purport to contain." Another option for FDA would be to follow the advice of former FDA Commissioner Scott Gottlieb, who suggested FDA needs to put the onus on manufacturers to petition the agency to prove CBD can be safely added to foods through the submission of NDIs or food additive petitions, which would include reviews of toxicity studies. "These are the same standards any new food ingredients are held to," Gottlieb explained in an July 31 opinion piece published by The Washington Post. "Congress can help by passing language saying that the FDA doesn't need to issue a broad regulation on CBD and can instead rely on petitions filed by individual, prospective producers." In the interim, the FDA could exercise enforcement discretion to allow CBD to be marketed in food so long as the products meet certain conditions, Gottlieb suggested.

Pressure on Congress

Whether Congress has the appetite for Gottlieb's plan is unclear but pressure from stakeholders did result in a move in late December by lawmakers to push FDA to act more quickly. The FDA spending bill approved by Congress in December includes $2 million for the agency to study hemp-derived CBD and to begin work on an enforcement discretion policy for food and dietary supplements that contain the non-psychoactive cannabis ingredient. Language in the bill earmarks the funding for "research, policy evaluation, market surveillance, issuance of an enforcement discretion policy" of hemp-derived CBD product. Within 60 days of enactment of the appropriations bill, FDA is tasked with providing the Senate and House Appropriations Committees with "a report regarding the agency's progress toward obtaining and analyzing data to help determine a policy of enforcement discretion and the process in which CBD meeting the definition of hemp will be evaluated for use in products."

Lawmakers are also directing FDA "to perform a sampling study of the current CBD marketplace to determine the extent to which products are mislabeled or adulterated" and report to the committees within six months. But the language falls far short for many stakeholders and is unlikely to quell demands for lawmakers to intervene again. Wasserman said the directives from Congress are "all items FDA is doing anyway", adding that language in prior versions of the spending bill went further and mandated quicker action and immediate enforcement discretion. Supplement manufacturers were clearly hoping Congress would take a more aggressive approach. A coalition of supplement makers led by the Council for Responsible Nutrition (CRN) and the United Natural Products Alliance (UNPA), have urged lawmakers to amend the FDCA to craft an explicit regulatory pathway for CBD supplements.

In a memo released after the spending bill was finalized, UNPA officials said apparently FDA "was not supportive of the industry's language recommending an NDI pathway" for CBD dietary supplements and "insists on evidence that would support a dosage level." Wasserman suggested FDA's position that it lacks the needed safety data makes it unlikely Congress will force the issue and require it to take specific action to open the door for CBD foods and supplements. "IF FDA says this isn't safe, you don't want to push them too hard," Matthews said. Ronholm agreed that lawmakers are likely to be cautious about heaping too much pressure on FDA and meddling with its review of CBD. "FDA is just in a really tough spot," Ronholm said. "They have no safety data whatsoever but are being pressured to put together regulatory scheme. It is not fair to a public health agency."

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US food and supplement manufacturers, keen to take advantage of booming consumer interest in cannabidiol (CBD), remain frustrated by a patchwork of state regulatory regimes and the lack of FDA rules that would legitimize the market and allow for interstate sales of hemp-derived CBD foods and supplements.

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Posted 08 October 2019 by Jonathan Pegg, US Correspondent, IHS Markit

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