Recent FDA Warning Letter Valuable Reminder To CBD Industry – Don’t Ignore Basic Regulatory Compliance


by Rachel Meyer and Sandra Morar

rmeyer@mcgrathnorth.com

smorar@mcgrathnorth.com

(402) 341-3070

Following similar announcements by CVS and Walgreens, Kroger became the latest retailer to join the CBD craze when it announced plans to sell CBD-infused products. Sales of products containing CBD are expected to top $5 billion this year, a 700% increase from 2018, and could reach nearly $24 billion in sales by 2023, according to analysts. However, a recent warning letter from the FDA contains important reminders for the industry.

Although hemp-derived cannabidiol (CBD) was de-criminalized by the federal government in the 2018 Farm Bill, the Bill did not affect FDA or the States’ authority to regulate CBD or other cannabis or hemp products in FDA-regulated products. To date, the FDA has not approved CBD in food or drinks for humans or animals, dietary supplements or topical cosmetics and maintains its current position that it is illegal to sell a food or dietary supplement that contains added CBD in interstate commerce. Historically, however, the FDA has generally taken a passive approach to the enforcement of hemp-derived CBD products.

On July 22, 2019, FDA issued a warning letter to one of the largest producers of CBD-based products, Curaleaf, Inc. The FDA reiterated that certain hemp substances, including CBD, have a questionable regulatory and safety status in the eyes of FDA and some state governments despite the 2018 Farm Bill. But the more likely trigger for the action was the marketing claims that were associated with Curaleaf’s products.

The FDA surveyed Curaleaf’s website and social media pages, and found claims like:

  • “[S]oothing tincture for chronic pain.”
  • “CBD has been demonstrated to have properties that counteract the growth of spread of cancer.”
  • “CBD has also been shown to be effective in treating Parkinson’s disease.”
  • “CBD oil can be used in a variety of ways to help with chronic anxiety.”
  • “CBD is being adopted more and more as a natural alternative to pharmaceutical-grade treatments for depression and anxiety.”

These are clear drug claims related to treating or preventing diseases, and FDA concluded that the products were misbranded and unapproved new drugs.

In response to the warning letter, the company stated that it’s removing statements from its website and social media that FDA identified as noncompliant. Also of note, following the warning letter, CVS immediately removed all Curaleaf products from its shelves, and Curaleaf’s stock tumbled.

The bottom line is that fundamental regulatory compliance matters. The full list of Curaleaf’s claims reinforce best practices for drafting and substantiating claims appearing on any food or dietary supplement labels (not just those containing CBD). And if the claim is on a product that is already under scrutiny for regulatory discretion, then compliance is especially important.

In addition to regulatory enforcement action, publicly issued warning letters may also lead to class action lawsuits based on a claim that statements are false and misleading and actionable under state consumer protection laws. While the statute the FDA is tasked with implementing (the Federal Food, Drug, and Cosmetic Act) does not include a private right of action, litigants and courts often use FDA warning letters for guidance as to whether a marketing claim is, or is not, susceptible to challenge under various consumer protection laws.

It is crucial for companies that market or sell CBD products to confirm that their marketing materials and labeling generally comply with FDA requirements and avoid making unapproved human or animal drug claims. If you currently market or are considering marketing CBD products, contact our Food and Dietary Supplement regulatory team to guide you through state and federal labeling and advertising requirements.

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