FDA Objects to CBD as Diet Supplement, Extending Uncertainty
(Bloomberg) -- The U.S. Food and Drug Administration objected to an application from Charlotte’s Web Holdings Inc. for a CBD product to be sold as a dietary ingredient, leaving a cloud of uncertainty over the booming industry for the cannabis-derived substance.
The company’s bid to sell its full-spectrum hemp extract with CBD as a dietary supplement won’t be considered because of the FDA’s own prior decision to treat CBD as a drug, according to a letter posted on the agency’s website Wednesday. This shouldn’t disrupt the business of Charlotte’s Web or prevent other companies from continuing to sell such products, which already exist in a gray area without the agency’s oversight.
The decision shows the agency’s ongoing hesitancy to regulate cannabidiol, the non-psychoactive ingredient in cannabis plants better known as CBD. The market for CBD products has already grown to more than $6 billion as consumers seek help with everything from relaxation to focus to better sleep. Still, the sales are unregulated, aside from sporadic crackdowns on companies that try to make unsubstantiated claims about its health benefits.
The FDA’s objection rested in part on its prior approval of Epidiolex, a CBD drug to reduce seizures, which the agency said precludes it from authorizing CBD for dietary purposes. Even if the drug hadn’t been approved, though, the FDA said in the letter to Charlotte’s Web dated July 23 that it “has concerns about the adequacy of safety evidence” that the company submitted. The agency would have wanted more data on potential liver and reproductive toxicity.
“While we disagree with FDA’s reasoning, believing we provided extensive and credible scientific evidence that supported a different outcome, this decision affirms the path to regulatory clarity must come from Congress,” Charlotte’s Web Chief Executive Officer Deanie Elsner said in a statement.
The company also said “the conclusions drawn by the FDA do not appear to be based on the data provided” in its application. It has asked the FDA correct its record to reflect the data it submitted. In a separate letter to the FDA dated Aug. 3, Charlotte’s Web said its submission included data that showed no effects to reproductive organs or liver damage.
The FDA didn’t immediately respond to a request for comment.
The FDA also published some of its correspondence with Charlotte’s Web and Irwin Naturals, a Los Angeles-based seller of supplements including those with CBD, over their applications, in which it asked for more data about effects related to male reproductive toxicity. The agency asked Charlotte’s Web to show that its products would “not result in adverse events” in this area.
Many consumer-product manufacturers use “CBD isolate,” which can be extracted and synthesized, and may be bought from third-party wholesalers. Charlotte’s Web and some competitors specialize in so-called full spectrum CBD, which is extracted from plants and includes other naturally occurring compounds. Charlotte’s Web had argued that this -- along with the fact that it handles its own genetics, cultivation and processing -- makes its product safe and substantially different from Epidiolex.
Charlotte’s Web is the top-selling CBD brand in the U.S., according to a midyear report from Brightfield Group, followed by Medterra, cbdMD Inc., CBDfx and CBDistillery. Some big alcohol companies have started to dip their toes into the market for CBD beverages, including Molson Coors Beverage Co., which has a joint venture with Hexo Corp., and Constellation Brands Inc., an investor in Canopy Growth Corp.
Since CBD became federally legal under the 2018 farm bill, the FDA has said it wants to ensure consumer products containing it are safe, but has yet to act. Companies that sell CBD could benefit from regulatory oversight because it would make mass market retailers more comfortable with selling their products, make consumers more comfortable with using them, and could also help companies with higher quality products gain an advantage over competitors.
While approval of a CBD consumer product could have been a breakthrough for the industry, the FDA’s latest decision could push the industry more quickly toward a legislative solution, cannabis leaders say. Current bills, such as the one from Senate Majority Leader Chuck Schumer, could force the FDA to regulate CBD within a specific time frame.
“There are some very high-quality, reputable products in the marketplace, but unfortunately consumers have to navigate that on their own, because the FDA isn’t creating a regulatory framework around this industry,” said Steve Mister, CEO of the Council for Responsible Nutrition, a supplement industry trade group.
Still, the CBD market in the U.S. is projected to expand from $6.3 billion this year to more than $20 billion by 2026, according to cannabis market tracking firm BDSA. That’s in part because of the potential for greater regulatory clarity: BDSA had said it expects the FDA to nod to CBD’s use as a food additive by early 2022.
“The entire industry could benefit from some ingredients being legitimized,” Kelly Nielsen, BDSA’s vice president of insights & analytics, said in a phone interview before the FDA’s decision regarding Charlotte’s Web.
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