The House Oversight Committee calls for more FDA action to ensure safe hemp product access
By: Stephanie Ramirez
“It’s unfortunate that it’s taken this long for Congress to finally get a sit down with the FDA to get the ball really rolling here, but we’ve had a relatively long leash with CBD.” —Nate Farnsworth, Co-owner, Factory6 Inc.
The Subcommittee on Health Care and Financial Services within the Committee on Oversight and Accountability (U.S. House of Representatives) held a hearing in late July, titled “Hemp in the Modern World: The Yearslong Wait for FDA Action,” to examine the failures of the Food and Drug Administration (FDA) to regulate CBD and hemp-derived products.
The backdrop of this hearing traces back to the pivotal 2018 Farm Bill, which not only ushered in the legality of hemp cultivation and the sale of hemp-derived goods but also affirmed the FDA’s jurisdiction over regulating these products.
The 2018 Farm Bill brought about significant changes to hemp product laws in the United States. One of the most notable changes was the removal of hemp from the list of controlled substances, effectively legalizing its cultivation, transportation and sale. This legislation defined hemp as cannabis containing no more than 0.3% THC by dry weight, distinguishing it from marijuana. Hemp is where cannabidiol, or CBD, is sourced from as it is the dominant cannabinoid in the plant vs. THC.
Consequently, farmers gained the opportunity to participate in legal hemp cultivation, promoting economic growth in the agricultural sector. Additionally, the Farm Bill paved the way for increased research into hemp’s potential benefits, allowing universities and state departments to initiate pilot programs for cultivation. Overall, the 2018 Farm Bill marked a pivotal shift in hemp regulations, fostering a burgeoning industry for hemp-derived products such as CBD and textiles.
However, despite these legislative provisions, the FDA’s stance has been a subject of concern, with the agency seemingly reluctant to fully embrace its regulatory authority, as pointed out in a press release issued by the Committee on Oversight and Accountability on July 28.
This uncertainty has left CBD manufacturers in a gray market purgatory. Witnesses at the hearing included Jonathan S. Miller, General Counsel of the U.S. Hemp Roundtable, who stated during opening testimony, “unfortunately, the U.S. hemp industry has been struggling considerably in the last few years. This turmoil is due in large part to decisions made by the FDA. Lack of a federal framework has led to the proliferation of unregulated products, some of which raise significant quality, safety, and other consumer protection concerns.”
All the witnesses underscored that the absence of an FDA regulatory framework for hemp-derived CBD has led to the increased availability of products containing potentially intoxicating cannabinoids, notably delta-8 THC. These products are being sold without oversight, and there are instances of them reaching minors.
While the witnesses unanimously reject the idea of criminalizing these products, they share a consensus on the necessity for robust regulations. The primary objective is to ensure safety and prevent access by children.
One of the key takeaways the Committee leaders gathered from testimony is that the public needs the FDA to do its job and regulate CBD for the benefit of the industry, farmers, businesses, and consumers alike.
“Without a federal regulatory pathway for requiring such standards, economic opportunities for U.S. hemp farmers will be diminished and consumers will not have access to safe, quality products,” Miller also stated during the hearing.
Committee member Rep. Glenn Grothman (R-Wisconsin) asked the witnesses what the economic consequences would be if CBD was regulated as a food supplement or additive by the FDA, and Miller responded by saying that according to a study from the Brightfield Group, it could mean a difference of $5 billion if these regulatory pathways are made clear.
“It’s unfortunate that it’s taken this long for Congress to finally get a sit down with the FDA to get the ball really rolling here, but we’ve had a relatively long leash with CBD,” shared Nate Farnsworth, co-owner at Factory6, an integrated contract manufacturer and co-packer of supplements. “Being able to manufacture products with it in the U.S. has allowed different companies to test the market and to get the product out there to consumers in different ways, albeit with some limitations,” he added.
The CBD industry is at a precipice of change, but despite the regulatory uncertainty currently clouding the CBD landscape, industry leaders and stakeholders remain resilient and hopeful for a transformative future.
Meredith Cook, co-CEO and co-founder of Green Compass, a mission-led provider of hemp-based wellness products out of North Carolina, says her team is excited about the 2023 Farm Bill. They believe it will have a most positive impact on the broader industry.
“We believe the Farm Bill will loosen bank regulations and better empower and reward farmers,” Cook shares. “It will implement fair and reasonable regulation and lift unnecessary restrictions. To us, it shows that there has been a close evaluation of what has and hasn’t worked for the industry in the years since the 2018 Farm Bill.”
Consumer Perceptions of CBD Products
Recent published data from independent health research firm CFAH indicates that only 26% of Americans say they use CBD products, but that is expected to increase to 35% by 2024. However, according to a survey conducted among 1,500 respondents by CFAH, there are still a great number of people who are either hesitant to try it or have not found any CBD products that appeal to them.
Channel leaders suggest that one of the reasons demand has slowed is because many consumers may not have had a good experience with the products they tried or simply didn’t feel anything at all.
“What’s happened is that consumers may see two products, and they’re priced the same, but one has a thousand milligrams and one has a hundred – that’s a bad actor,” says Nicola Stephenson, co-founder of Ohho, a direct seller of hemp-derived products based in Bedford, N.Y. “At Ohho we make everything as strong as we possibly can. We’re not going to make anything that doesn’t work.”
Stephenson adds, “And I think the other thing that’s been very harmful to the industry are the claims, like, it can cure cancer, well, it definitely can’t. There’s anomalies everywhere, but it is just so misleading to people. I think the potency has got to be there. The transparency’s got to be there.”
While keeping a positive outlook for the future of the industry, Farnsworth feels it’s going to take a long time to recover from the effects the bad actors had on the industry early on.
“I think it’s an unfortunate situation that we’ve gotten into,” he says. “There were, I think, enough bad actors early on that were hyper inflating the effects of CBD and oftentimes diluting and not accurately reporting what was in the product, then lots of consumers tried CBD products and had poor experiences that were not necessarily averse, but they just didn’t feel the effects that other people may have had. If you build a product that works, and you test it and you appropriately disclose what’s in it, I think there’s a lot of good benefit and we’re seeing that.”
CBD has gone from fringe to mainstream in the world of wellness, and today it is legal in almost all 50 states with many states providing conditions around its legality.
Still there are some communities and generations that associate hemp and CBD products with marijuana, opines Cook.
“The CBD industry is a complicated one, and there are many misconceptions about how hemp is grown and how products are formulated and produced,” Cook says. “We partner with our community, helping them to understand how hemp is different from marijuana, the different extractions that come from the hemp plant — full spectrum and broad spectrum — and the user experience and benefits for each type.”
She continues, “Additionally, we are passionate about educating around the hemp industry as a whole, shedding light on the lack of regulations and why it’s important to shop with brands that are USDA-certified Organic and involved in every step of production, from cultivation to extraction to formulation.”
Farnsworth affirms that CBD is not going anywhere. He says humans have been using it for thousands of years. “The science that we’re finding and now pairing with other supplements is only going to make it more and more effective,” Farnsworth adds. “And if you’re doing it right, and you’re in it for the long game, then absolutely there is value in it, and consumers will see that value.”
The Evolution of CBD Products
Farnsworth believes that microdosing cannabis products and combining them with other supplements is an untapped market.
“We’re seeing a lot of really good benefits in that space, especially from a legal standpoint,” he shares. “Using small amounts of Delta 9 THC and combining them with some really innovative, but clinically studied nootropics, I think is a really mostly untapped market.”
The term “nootropics” is used to refer to any natural or synthetic substance that may have a positive impact on mental skills.
“Nootropic is a buzzword right now that’s a little bit of a catch-all for anything that gives a cognitive benefit,” Farnsworth says. “So technically you can say caffeine is a nootropic because it’s a cognitive booster, even though it’s really just a stimulant. There are a bunch of branded ingredients out there that suppliers are selling that have good clinical studies behind them that allow you, especially as a network marketing company, to make claims around the benefits that you get from them.”
Cook shares that in many cases, cannabinoids work best when paired with one another.
“This is what is known as the entourage effect,” Cook says. “Currently, we use CBD, CBN, CBG, and CBDA in our products, though some products also contain THC. We are always looking to evolve and innovate, and have been interested in learning more about the combination of cannabinoids and other synergistic, functional plant ingredients.”
She adds that individual cannabinoid research is ongoing in the hemp industry and her company is excited to see what researched benefits might be up next. The focus now seems to be on minor cannabinoids outside of CBD and THC, she says.
“At Green Compass, we focus on researched cannabinoids that solve a problem we know our customers struggle with,” Cook says. “An example would be CBN and sleep benefits. A No. 1 concern or problem faced by our customers is not getting enough quality sleep.”
Stephenson shares how Ohho is diving into mixers infused with CBD.
“We’re always thinking about what problem we can solve so we’ve just launched a water soluble mixer because so many people are trying to get away from alcohol,” Stephenson says. “This is another huge trend, which again, I think will totally amplify this business. You can have a low-dose drink and replace alcohol with that because there’s nothing good about alcohol.”
She says chocolate is also a great carrier for cannabinoids. She adds that Ohho combines both CBN and CBD in chocolate bars made with Ecuadorian chocolate.
“We have hot chocolate coming out this winter, so you’ll be able to mix this with whatever milk or nut milk of your choice before bed and add marshmallows and anything else that makes you happy,” Stephenson says. “We don’t want our CBD to look pharmaceutical. That’s the antithesis for us.”
Hemp Product Marketers Optimistic About Farm Bill Impact
Despite the evolving regulatory landscape currently shaping the CBD industry, leaders and stakeholders in the space say there is much to look forward to. The prevailing optimism and determination reflect the potential for a brighter horizon, driven by regulatory clarity and consumer safety.
As deliberations continue and the 2023 Farm Bill’s finalization looms, the collective anticipation underscores the industry’s aspiration to leverage this legislative momentum for a paradigm shift. Amidst the dynamic landscape, the CBD industry stands poised for positive change, invoking the spirit of innovation and adaptability that has become synonymous with its identity.
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