FDA Schedules First Public Hearing On CBD, Sends Warning Letters To 3 Companies

In what could potentially be a breakthrough for the U.S. CBD market, the Food and Drug Administration announced the first public hearing to obtain more data about CBD products. The announcement comes as the FDA and FTC is sending warning letters to three companies that sell CBD products, accusing them of false advertising. 

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What Happened

The May 31 hearing is set to obtain scientific data and information regarding the safety, manufacturing, product quality, marketing, labeling and sale of products containing cannabis or cannabis-derived compounds. 

The regulator plans to obtain information related to health and safety risks of CBD; manufacturing standards; methods of testing of products containing CBD; how these products are labeled; and how consumers are warned about risks associated with them. 

On Tuesday, the FDA and FTC sent joint warning letters to three companies: Nutra Pure, PotNetwork Holdings Inc POTN and Advanced Spine and Pain.

The agencies said the companies are falsely advertising CBD supplements, claiming they can treat diseases such as cancer and Alzheimer's. The companies in question have 15 days to address the issues and notify the FTC. 

Why It's Important

The 2018 Farm Bill signed into law in December legalized hemp and hemp-derived CBD, but also authorized the FDA to regulate CBD products.

This creates a problem because CBD is an active ingredient in an approved drug — GW Pharmaceuticals plc GWPH's Epidiolex — which means that CBD products violate the FD&C Act and could potentially undermine the drug approval process. 

Nevertheless, CBD products have been steadily making their way to the shelves of retailers like DSW Inc. DSW, Walgreens Boots Alliance Inc WBA, and CVS Health Corp CVS. 

Establishing a clear set of regulations for CBD products could remove many uncertainties and incentivize more retailers to start offering CBD products, while consumer packaged goods companies could warm to the space and develop new products. 

"We think this is a huge step forward for consumers that are clearly very excited about having CBD included in everything from topicals to infused foods and beverages. You are seeing a surge of businesses coming out with products," said Tim Moxey, founder of the CBD and cannabis edible company botanicaGLOBAL. 

"Having guidelines and rules from the FDA would allow the industry leaders to seriously commit to introducing hemp-derived products that consumers are already familiar with in states that have cannabis existing laws." 

What's Next

The FDA said it does not intend for the May 31 hearing to result in any decisions or regulatory action, but expects the event to be an "important step" in the agency's continued evaluation of cannabis and cannabinoids in FDA-regulated products. 

"I anticipate that the FDA will decide to stop throwing up the red flags about using CBD in food due to safety concerns," Celeste Miranda, CEO of MACE Media and CBD Expo Tour, told Benzinga. 

"I think they will hit hard on testing and proper labeling as well as rigid standards on making no claims." 

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