Hemp Space Grew 3X The Rate Of Cannabis, Where Did Marijuana Get It Wrong?

Hemp is federally legal and cannabis is not. Is that the only difference between these related plants and the two markets they create? What should investors know about each market before jumping in? 

A serious conversation led by industry experts Bret Worley, CEO of MC Nutraceuticals; Norman Birenbaum, Senior Public Health Advisor at the Food and Drug Administration (FDA); Pamela Epstein, chief legal & regulatory officer at Terpene Belt Farms and Keith Bushfield president & CEO of Rexis Biotech. These professionals shared their expertise and advice at the recent Benzinga Cannabis Capital Conference in Florida on a panel moderated by Justin Swanson, partner at Bose McKinney and Evans. 

It's been more than five years since Donald Trump signed the 2018 Farm Bill, which effectively legalized hemp and hemp-derived products. Under the bill, hemp is considered to have 0.3% delta 9 THC. This, however, left many questions unanswered and numerous products without proper regulation. One often-asked question has been whether products derived from hemp are food or supplements.

The new Farm Bill was up for renewal in 2023 but failed to meet the deadline. As a result, the House extended the 2018 Farm Bill through Sept. 30, 2024.

While the industry eagerly awaits the new Farm Bill, Birenabum said not to expect too much. " Whether things fall in or outside of the definition of hemp, there’s a huge market that is there right now. It’s going to be very, very difficult to take a prohibitionist approach, to get all that toothpaste back in the tube."

Birenbaum cautioned that changes to the Farm Bill "will not provide a comprehensive regulatory structure or the type of regulatory certainty that's needed." 

Epstein followed up. "It is more difficult to be a multi-state hemp cannabinoid producer than a multi-state cannabis operator because you have more certainty within the packaging, labeling and advertising restrictions," she said referring to the lack of clear regulations across the hemp space. She added that investors and raw producers are interested in long-term sustainability, which is achieved through understanding the safety data and the toxicology behind new products. 

Integrity As The Basis 

Worley asked a pertinent question. "Where did marijuana get it wrong and where did hemp get it right?" Alluding to the fact that hemp space has grown three to four times the rate of marijuana. He asked the panelists what they thought was the correct regulatory framework.

Epstein explained that hemp registration is much easier than seeking a license that burdens applicants with thousands, if not millions of dollars worth of debt before ever earning a penny. Regarding an appropriate framework, hemp operators need to be responsible stewards to unlock the scheduling, she said. "Don’t be afraid of the word intoxicated. We are all selling intoxicants. Alcohol is an intoxicant. It’s not a scary word. It’s an honest integrity." 

Bushfield added that there's going to be "bad actors in every industry, doesn't matter who it is," which is why we need proper regulations.

"Our compliance department attitude is – let’s have every single warning we possibly can put on those cans, and we put it out there even if we don’t need it, even if we’re not required. So I think that has to happen across the board.

"So, if we all get together, put the right framework in place, the hemp is going to help the cannabis, the cannabis will help the hemp," Bushfield concluded. 

The panelists agreed on the importance of education and the fact that prohibition is not helping consumer safety or consumer health.

Photo by Jean Laurenceau