Highs and Lows of CBD Oil and Why You Need a Lawyer

The CBD market is expected to grow to $2.5 billion in consumer sales by 2022. Though the economic opportunity for CBD oil is so enticing, there is no straightforward path to launching a new CBD product. CBD regulations are sometimes murky, and the murkiness is compounded by the ordinary risks of running a food or supplement business (which we have covered extensively on our Services Page).  Our strategy is to provide our CBD clients with the same services that we would provide any other food or supplement manufacturer, all while maintaining awareness of the special regulations associated with CBD manufacturing.

Cannabidiol (CBD) is a chemical compound that is found naturally in both hemp and marijuana varieties of the species Cannabis Sativa. While hemp is (mistakenly) associated with marijuana because of the shared relation to the cannabis plant family, a professional botanist can tell you they are not the same. Unlike marijuana, which contains psychoactive THC, hemp cultivars contain a much lower proportion of Tetrahydrocannabinol, or THC, which is the psychoactive component of marijuana cultivars. CBD oils that are derived from hemp contain a relatively insignificant amount of THC, and this is what enables CBD have the market potential we are seeing right now.

Research indicates that there are compelling medical reasons to use CBD. Recent studies have pointed to CBD as a treatment for epilepsy, fighting cancers, natural pain relief, as an anti-inflammatory, and for relief from anxiety disorders.

Discussing these benefits is a source of huge regulatory risk for our CBD clients. As we’ve discussed before, all of the words we use to market food products, supplement products, and drugs are strictly regulated by the Food and Drug Administration.

On top of that, the FDA issued a warning letter in November 2017 to four CBD companies that claimed CBD could prevent or cure cancer. In a press release, a representative of the organization stated, “Selling these unapproved products with unsubstantiated therapeutic claims is not only a violation of the Federal Food, Drug and Cosmetic Act, but also can put patients at risk as these products have not been proven to be safe or effective. The deceptive marketing of unproven treatments may keep some patients from accessing appropriate, recognized therapies to treat serious and even fatal diseases.”

We provide our CBD clients with ongoing marketing compliance guidance as they are developing their marketing strategy. We do not wait until the marketing strategy has been developed and implemented before we take a red pen to everything. We participate in the marketing discussion with the creative types so that once the copy goes live on the website, it is compliant.

Though the situation is improving as the efficacy of CBD products becomes more scientifically clear, the legal status of CBD can be murky and inconsistent, depending on the state, but overall trending towards clarity.

A state like Indiana, for example, mandates that as long as a CBD product contains less than 0.3% THC, it can be classified as a hemp product that is therefore legal to possess and distribute.

Other states completely prohibit the sale of CBD, no matter the proportion of THC or how the product was derived.

The Drug Enforcement Administration (DEA) still maintains that CBD is illegal, and a spokesperson of the same administration explained that those dealing with illegal drugs “risk arrest and prosecution.” It was only a few months ago that a man in Nebraska narrowly escaped jail time for possession of CBD oil with 0.00% THC.

All of our CBD clients receive an introductory consultation on the legal status of CBD tailored for their state and supplemented with the updates from the latest federal developments.

Contact a professional lawyer to ensure your business has the protection and guidance it needs. At The Food Law Firm, we are able to provide our clients with consultation and expertise, so that you can have peace of mind.