FDA Kicks off Round Two of America's CBD Odyssey

Remember back in 2018, when CBD was in everything from craft cocktails to hummus, and the FARM Act, which made hemp legal in America, was all set to open the floodgates to the molecule’s entry into mainstream wellness? Five years later, we’re all still using it, but the FDA has stood in the way of greater market penetration. However, after the powerful federal agency leaked to the Wall Street Journal last year that movement on CBD was imminent in the coming year, it finally confessed at the end of January that it simply did not have the guidance in place to regulate CBD as food additives or dietary supplements, for either pets or humans. So instead, it has called upon Congress to help them regulate the industry.

While this is happening, businesses are beginning to loosen their restrictions on the molecule., Alphabet, the parent company of Google, last year announced a loosening of its rules regarding CBD advertisements. While it still prevents many CBD companies from running promotions on their powerful service, it certainly showed that they, and perhaps others, are preparing for the floodgates to potentially open, yet again, this time with definitive rules of the road that will protect businesses and consumers. After all, even with CBD languishing in the grey area, the FDA’s own data shows that the CBD industry made $4.6 billion in 2021, and should quadruple by 2026. Should Congress tilt towards more lenient regulation, these numbers are likely to grow.

The Reason for Being

As far as the FDA is concerned, the only legitimate use for CBD is for rare childhood epilepsy cases such as Dravet’s Syndrome or Lennox-Gastault Syndrome. That’s what the orphan drug Epidiolex, created by Jazz Pharmaceuticals, was created to treat, and because of its status as a pharmaceutical, it’s not allowed in foods or beverages, at least nationwide. However, this has obviously not stopped intrepid entrepreneurs from creating products with it, nor has it intimidated certain states, such as California or Iowa, from creating their own regulations for these products. Apparently, this state of affairs continues to vex the FDA, as it periodically sends out cease-and-desists to random CBD companies making unfounded health claims. In its current release, the FDA declared that “a new regulatory pathway for CBD is needed that balances individuals’ desire for access to CBD products with the regulatory oversight needed to manage risks,” and pledged to work with Congress to create such a pathway.

CBD, thankfully, has supporters on both sides of the aisle, from Republican Kentucky Representative James Comer to Democratic Oregon Senator Ron Wyden. And for now, the CBD industry will not face any greater scrutiny than it already has until Congress develops its regulations. Since the FDA’s announcement, advocates have pointed to the statewide moves to regulate CBD, and recommended that any forthcoming regulations hew closely to what they have determined works best for them. Aaron Smith of the National Cannabis Industry Association, in an official statement, said “Today’s announcement by the FDA underscores the urgent need for Congress and the Administration to take swift action to modernize federal cannabis policy and regulate CBD and other products appropriately and in harmony with the vast majority of states that have already legalized cannabis in some form. A vibrant state-regulated industry has formed to safely provide cannabinoid products and medicines to millions of Americans, which has the support of the vast majority of U.S. voters. Moving forward with bi-partisan federal cannabis reform this year would be both good public health policy and good politics.”

Just Getting Started

In the meantime, Alphabet has made a small but significant step towards allowing hemp-derived CBD companies a chance to promote their own products on its search results. Its changes only impact two types of products: CBD-containing pharmaceuticals that have already been approved by the FDA as well as topicals. Plus, the ads will only be shown to users in California, Colorado and Puerto Rico, and they won’t see them if they’re under 18. Alphabet’s decision comes at a time when the company has reported its fifth consecutive quarter of losses and a recently announced anti-trust lawsuit leveled upon them by the US Department of Justice, which suggests a need to open up new avenues of revenue. However, Alphabet’s careful strategy appears to leave a lot of money on the table, for both them and CBD brands that have been forced to take their chances on skittish social media networks and the metaverse. Liz Dolinski of the CBD sexual wellness brand Foria told the Journal, “Allowing CBD products to fully use Google’s platform would unlock a lot of other marketing opportunities for Foria because so many other peripheral marketing technologies and platforms link into Google’s ecosystem.”

Will they be able to? It’s your move, Congress.