Tag Archives: dietary supplements

Jennifer Whetzel

Eating Your Words: How to Avoid Legal Issues Marketing Cannabis Consumables

By Jennifer Whetzel
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Jennifer Whetzel

Selling in a grey market isn’t for the faint of heart. You have to deal with the stigma surrounding your products and services, the potential for legal troubles, along with bureaucratic hurdles that all businesses face.

Acceptable marketing language surrounding consumable THC and CBD products encapsulates all of these issues, and it’s why everyone in the industry needs to pay close attention to what they’re saying. One innocent turn of phrase could have the Food & Drug Administration (FDA) shut down your business faster than you can say, “Oops.”

Avoiding this fate means making some adjustments to how you think about your marketing language, but this knowledge quickly becomes rote. Take a moment to learn how to protect yourself so that you can run your business rather than run afoul of the law.

Food, Drugs and Dietary Supplements

Scroll through Instagram for a few minutes and you’ll encounter a deluge of companies making claims about cannabis and CBD products. Many, if not most, are going about it incorrectly. Part of the confusion surrounds the fact that under the FDA’s rules, foods, drugs and dietary supplements are treated differently.

FDAlogoHow does the FDA decide what’s what? Based on how you advertise the product. If labeling suggests the substance is “intended for use in the diagnosis, cure, mitigation, treatment, or prevention of disease, or is an “article” (other than food) intended to affect the structure or any function of the body of man or other animals,” the FDA will regulate it as a drug.

The language and regulations surrounding drugs are extremely strict. On December 20, 2018, the FDA put out a statement reiterating that these rules are in effect for cannabis products. In other words, you can only make a drug claim if you have received approval from the FDA on your New Drug Application (NDA). Since approval requires hundreds of millions of dollars worth of clinical trials, this option is out of reach for most companies.

The rule states that you may not say that your product diagnoses, cures, mitigates, treats or prevents any disease, or any recognizable symptom of a disease. Disease is defined as: damage to an organ, part, structure, or system of the body such that it does not function properly (e.g., cardiovascular disease), or a state of health leading to such dysfunction it (e.g. hypertension). Examples of diseases would include cancer, multiple sclerosis, epilepsy, autoimmune diseases, Lyme disease and more. In other words, you couldn’t say your product “prevents memory loss due to Alzheimer’s” or “treats symptoms of fibromyalgia.”

If you’re making any claims about curing anything in your cannabis business name, product name, packaging, web copy, advertising or marketing materials, you are at risk for breaking these rules and getting caught. The FDA’s regulations dovetail with the Federal Trade Commission’s truth-in-advertising laws, which state that your claims must be backed by legitimate research (such as peer-reviewed journal articles or double-blind studies) and must not mislead consumers. These rules are already being enforced within the cannabis industry, so pay close attention to what you’re putting out there.

An example of a warning letter the FDA sent to a CBD products company making health claims

However, you can’t avoid penalties by using this kind of language and claiming your product is a dietary supplement or food, either. According to the FDA, products that contain THC or CBD cannot be sold as dietary supplements. Their reasoning for this decision is that THC and CBD are active ingredients in FDA-approved drugs, such as Epidiolex and Dronabinol. Active ingredients in approved drugs may not be introduced into the food supply as dietary supplements or otherwise.

The language rules surrounding food can be equally complex. Foods approved by the FDA can make nutritional claims about how a nutrient impacts the structure/function of the body, such as “Calcium builds strong bones.” The problem for cannabis products is that these statements need to be authorized or qualified by the FDA and have significant scientific evidence and consensus. However, this consensus doesn’t exist for THC and CBD, meaning that you’re barred from making these kinds of claims.

Note that these rules don’t just apply to human supplements. They also apply to ones for pets. Many people don’t realize that a supplement for a pet is considered an “illegal drug of low regulatory concern.” But if you add in THC or CBD, a supplement becomes an illegal drug of—you guessed it—higher regulatory concern.

At a Loss for Words?

By now, you may be wondering what you can actually say to market your product; it may feel as though there are more restrictions than guidelines. Fortunately, the FDA hasn’t left us completely out at sea.

Just because we’re in a strange place under federal law operating our businesses every day doesn’t mean that we should disregard fundamental rules and regulations that all businesses must follow. The FDA published a final rule in the Federal Register in 2000 defining strict rules that govern the types of statements that may be used on a label without prior review of the agency. These are called structure/function claims. According to the FDA, “Structure/function claims may describe the role of a nutrient or dietary ingredient intended to affect the normal structure or function of the human body.” In contrast, statements that claim to diagnose, cure, mitigate, treat or prevent disease require prior approval by the FDA and are only for products that are approved drugs. Don’t use any of those words. Ever.

You can use the following words in your cannabis product names, advertising or marketing, as long as you’re not connecting them to a disease state: restore, support, maintain, raise, lower, promote, regulate, stimulate. You must specifically state that the claim relates to a non-disease condition; otherwise, you’ll be in trouble with the FDA. To go back to an earlier example, you cannot say that your product “prevents memory loss due to Alzheimer’s.” However, stating that your product “helps maintain a healthy brain” is fine.

Just because we’re in a strange place under federal law operating our businesses every day doesn’t mean that we should disregard fundamental rules and regulations that all businesses must follow. Following these rules does more than keep our enterprises out of trouble. It reinforces the idea that our industry is responsible, legitimate, and—perhaps most importantly—here to stay.

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Hemp Products & Confusion Over FDA Remains

By Charlotte Peyton
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Hemp

The hemp industry is the marijuana industry’s half-sister. Both are variations of the plant Cannabis sativa and both were made illegal in 1937 with the passing of The Marijuana Tax Act. Despite this federal status, in recent years 33 individual states have legalized some type of medicinal marijuana use and 11 states now allow legal recreational marijuana within their borders. This prompted congress to modify the legality of hemp which was addressed in The Agricultural Act of 2014, but it only allowed hemp to be used for research purposes. The Agriculture Improvement Act of 2018 (known as the 2018 Farm Bill) that was signed into law on December 20, 2018 was a huge step forward for public access to hemp and hemp products. The 2018 Farm Bill legalized the growing of hemp in states with a state-mandated hemp program and removed hemp and its derivatives from Drug Enforcement Administration (DEA) Schedule I status. Schedule I drugs, substances, or chemicals are defined as drugs with no currently accepted medical use and a high potential for abuse. Some examples of Schedule I drugs are heroin, lysergic acid diethylamide (LSD), 3,4-methylenedioxymethamphetamine (ecstasy), methaqualone, and peyote. Consumers and the cannabis industry alike were very excited about this legalization of hemp…. but that was when the confusion began.

FDA & Hemp

FDAlogoWithin two hours of the 2018 Farm Bill being signed, the Commissioner of the FDA, Dr. Scott Gottlieb, issued a statement reiterating the FDA stance on cannabis products and cannabidiol (CBD) in products for human and animal consumption: “Congress explicitly preserved the agency’s current authority to regulate products containing cannabis or cannabis-derived compounds under the Federal Food, Drug, and Cosmetic Act (FD&C Act) and section 351 of the Public Health Service Act.” Currently the FDA only permits CBD products submitted as an Investigational New Drug (IND) Application as a pharmaceutical. There is only one such accepted CBD product, Epidiolex, manufactured by G.W. Pharma. All other CBD products are illegal for interstate shipment.

Every product for sale in the US which is either ingested or applied to a human or animal body has a regulatory category in the FDA. Hemp-derived CBD products will have to fit into one of those categories or it will not be legal. Many hemp manufacturing companies will argue with the illegality of CBD products, but it will get them nowhere. If you manufacture and sell hemp products inside of a state with a state mandated hemp program, you are legal and protected under state laws, but the minute you sell across state lines, it becomes the jurisdiction of the federal government and, more specifically, the FDA. Section 10113 of the 2018 Farm Bill states that (c) Nothing in this subtitle shall affect or modify:

  • (1) the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 301 et seq.);
  • (2) section 351 of the Public Health Service Act (42 U.S.C. 262); or
  • (3) the authority of the Commissioner of Food and Drugs and the Secretary of Health and Human Services- ‘‘(A) under- ‘‘(i) the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 301 et seq.); or ‘‘(ii) section 351 of the Public Health Service Act (42 U.S.C. 262); or ‘‘(B) to promulgate Federal regulations and guidelines that relate to the production of hemp under the Act described in subparagraph (A)(i) or the section described in subparagraph (A)(ii).”

There is nothing unclear about this issue. The same 2018 Farm Bill that hemp manufacturing companies use to justify the legality of hemp and CBD products is the same bill that spells out the authority of the FDA in this matter.

The mission of the FDA is “to ensure the safety, effectiveness, and security of human and veterinary drugs, vaccines and other biological products for human use, and medical devices.” The agency also is responsible for “the safety and security of our nation’s food supply, cosmetics, dietary supplements, products that give off electronic radiation, and for regulating tobacco products.” Health or medical claims not supported by clinical proof will not be tolerated. An unsafe, unclean or untested product will also not be tolerated in the marketplace.

CBD Oil vs. Isolate

The structure of cannabidiol, one of 400 active compounds found in cannabis.

Then there is the matter of CBD as either a full spectrum oil vs. an isolate…Unlike marijuana flower which is a very popular product, hemp flower is very rarely sold at the retail level. Full spectrum oil is extracted from the plant, and depending on the solvent used, produces an oil with the same, or close to the same, naturally occurring chemicals from the plant. The oil therefore, includes all the cannabinoids present along with any terpenes, lipids or other compounds present in the plant. Full spectrum oil is a botanical extract and is a dark thick oil. Isolate is produced by separating the constituents of the full spectrum oil by molecular weights or boiling points to have very pure chemicals in the 95%+ purity range. CBD isolate is a white crystalline substance and bears the greatest resemblance to a synthetic raw material and at its purest form cannot be distinguished as coming from a plant in the dirt or a synthesized chemical. Epidiolex is produced from hemp isolate and was approved by the FDA as a pharmaceutical. Full spectrum hemp oil is a botanical extract, often as an ethanol extraction. Full spectrum oil bears the greatest resemblance to a botanical dietary supplement. It remains to be seen what the FDA will allow in the future.

Product Labeling

The FDA has made it abundantly clear in numerous warning letters issued to the cannabis industry that drug claims (articles intended for use in the diagnosis, cure, mitigation, treatment or prevention of disease) regarding CBD, oil or isolate, cannot be made without pharmaceutical approval of the Drug Facts (Epidiolex) lest there be enforcement consequence.

An excerpt of an FDA warning letter sent to a CBD company in November of 2017

The labeling of other types of products are less clear. Dietary supplements are a category of foods with the FDA and as such both the labeling of dietary supplements and foods are dictated in 21 CFR 111, Food Labeling. Botanical dietary supplements frequently call out a chemical constituent within a particular botanical material or extract on the Supplement Facts Panel: Milk thistle seed extract containing standardized and labeled silymarin is such an example. Is this strategy acceptable for CBD with the FDA? What about “naturally occurring” CBD? Food claims are indicated in the Nutrition Facts, what can these be for CBD? Cosmetic product claims can only address articles intended to be applied to the human body for cleansing, beautifying, promoting attractiveness, or altering the appearance without affecting the body’s structure or functions. What is the purpose of CBD in a cosmetic?

FDA guidance would be very beneficial in all of these labeling areas, and there is hope. The FDA is promising public hearings this spring to discuss a path forward for having hemp food and dietary supplements. The FDA will ask for public comment and hopefully, there will be a lot of public comments provided to them. The public’s huge demand for CBD products will bear pressure on the FDA to at least listen and consider.

cGMPsRegulatory compliance will be difficult, and it will be expensive.

Those currently in the hemp manufacturing industry should pay attention and take the FDA seriously. If the FDA allows hemp products with CBD to be sold in the future, it will be the FDA who makes those regulations and those products will have to fit into an already existing FDA category: human food, animal food, dietary supplement, pharmaceutical or cosmetic. If you are a hemp product manufacturer, you must learn the applicable requirements for Current Good Manufacturing Practices (cGMPs) by hiring experienced FDA compliance personnel, and/or seeking out FDA regulatory consultants, to develop and implement a quality system accordingly:

  • 21 CFR 117, Current Good Manufacturing Practice, Hazard Analysis, and Rick-Based Preventative Controls for Human Food
  • 21 CFR 507, Current Good Manufacturing Practice, Hazard Analysis, and Rick-Based Preventative Controls for Food for Animals
  • 21 CFR 111, Current Good Manufacturing Practice in Manufacturing, Packaging, Labeling, or Holding Operations for Dietary Supplements
  • 21 CFR 210, Current Good Manufacturing Practice in Manufacturing, Processing, Packing, or Holding of Drugs; General
  • 21 CFR 211, Current Good Manufacturing Practice for Finished Pharmaceuticals
  • FDA Draft Guidance for Industry, Cosmetic Good Manufacturing Practice, June 2013

I believe in this industry and I am rooting for the pioneers who have taken all the risk thus far, but the level of denial of the FDA’s authority that I am hearing in the hemp industry community is disturbing to me because those companies will not manage the transition to a regulated future. Most don’t understand it and they don’t think it applies to them or their products. Regulatory compliance will be difficult, and it will be expensive. The hemp pioneers deserve to benefit from their labor and the risk they have taken. For those hemp product companies that do not think compliance is worth the effort or cost, there are many FDA-compliant human food, animal food, dietary supplement, pharmaceutical, or cosmetic companies that are waiting to take your business…


Editor’s Note: While Cannabis Industry Journal typically does not use the term ‘marijuana,’ the author here is speaking from a regulatory point of view and creates an important distinction. Peyton chose the word “marijuana” instead of “cannabis” because the FDA has chosen “cannabis” to refer to both marijuana and hemp. 

Product Labeling Law: A Primer and a Warning for California Cannabis Executives

By Jonathan C. Sandler
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What do you get when you combine a Schedule 1 federally controlled substance with a plethora of food, beverage and cosmetic entrepreneurs marketing new products to inexperienced users and then place that combustible combination into California’s plaintiff-friendly legal environment?

A lot of rich plaintiffs’ attorneys.

California continues to be a favored plaintiffs’ lawyers’ venue for filing consumer-related lawsuits against food and cosmetic companies. These lawsuits result in tens of millions in settlements each year and hundreds of millions in judgments. Staying current on statutes and trends is critical to doing business in California and cannabis companies are no exception.

While the Food and Drug Administration (“FDA”) has provided very little guidance on how cannabis products should be labeled, a lack of specific regulations does not mean that there are no applicable labeling requirements for cannabis. This is particularly true in states like California that have a multitude of statutes designed to protect consumers from false or misleading advertising and labeling. Below includes a brief list to help guide companies’ labelling processes:

  1. Look to available guidance for the relevant industries. For example, food labeling of cannabis products still requires compliance with other nutritional labeling statutes. The same goes for supplements and cosmetics. The Fair Packaging and Label Act (“FPLA”) regulates labeling of all “consumer commodities” as to net contents, product identity, and manufacturer’s, packer’s or distributor’s name and location.
  2. Consider the intended use of the product as well as the directions. For example, is the product meant to be consumed all at once or should it be consumed over a period of time? Depending upon the product, this question can affect whether compliance with the FDA dietary supplements guidance is required or whether the Food Drug and Cosmetic Act applies.
  3. Consider your supply chains. This can be one of the most difficult aspects for cannabis companies that are looking to expand, but need more supply. However, keeping track of ingredients is a critical aspect to being able to defend against lawsuits. In the past, cannabis companies have been sued because they have expanded their suppliers without assuring consistency in the products and then combining inconsistent ingredients into one common product that is now mislabeled. While the Bureau of Cannabis Control testing requirements should help with some of the cannabis information, all ingredients need to be tracked and the final products tested.
  4. Cannabis companies must label their products with applicable state laws. For example, the California Safe Drinking Water and Toxic Enforcement Act of 1986, better known as Proposition 65 (“Prop. 65”)is being used by the plaintiffs’ bar as a basis to sue cannabis companies.
    • Prop. 65 is a statewide initiative that regulates companies that make or sell their products in California in two ways: (1) it requires companies whose products contain certain levels of chemicals to provide clear and reasonable warnings. Prop. 65 does not ban or restrict the sale of chemicals on the list or their inclusion in products, but it requires warnings if the listed chemicals are included; and (2) It prevents companies from discharging these chemicals into the state’s water supply.
    • All companies doing business in California and all products manufactured or sold in California are subject to Prop. 65 with three exceptions: (1) the company has fewer than 10 employees, (2) government agencies, or (3) the products contain less than a threshold amount of the chemicals.
    • Penalties for violations can be staggering. Prop. 65 is enforced both by the California Attorney General and private lawsuits on behalf of the California Attorney General. The potential penalties for violations of Prop. 65 include a fine of up to $2,500 per day. Additionally, one of the largest drivers of litigation is that the private enforcers (plaintiffs’ bar) can recover their attorneys’ fees. The total amount paid in settlements in 2017 was over $25 million and of the more than $18 million in judgments, $13 million was attributed to attorneys’ fees.
  5. The California Consumers Legal Remedies Act (“CLRA”) is another California statute that is intended to protect consumers from false advertising and other unfair business practices. The CLRA allows consumers to bring individual or California class action lawsuits to recover damages and enjoin the prohibited practices. The statute also allows a prevailing consumer to recover attorneys’ fees and costs. Cannabis companies need to be mindful of their representations related to their products. California courts are filled with cases involving terms like “natural” or “healthy” or “high performing.”

Product labeling, mottos and advertisements may seem straightforward, but they form the basis for hundreds of lawsuits filed every year throughout the country, and especially in California. At this stage of trying to get one’s product out the door and to the consumer, it is tempting to move quickly. However, the importance of sound research, strategy and consulting an experienced team to ensure compliance and avoid costly mistakes is critical.