Tag: CBD

Wisconsin CBD Retailer Arrested Due to Prohibited THC Levels Found in CBD Products including Delta-8

Posted on April 5, 2021 by - Government Affairs, Pharmacy, Specialty Pharmacy

Recently, three operators of a Wisconsin CBD dispensary were arrested and are awaiting felony drug charges after failing to comply with the state law. The investigation into the dispensary began when two minors consumed a CBD-related products their parents had purchased from the dispensary. According to the sheriff’s department, several of the CBD-related products, including Delta-8-tetrahydrocannabinol (“Delta-8”) containing products, had THC level in excess of 0.3% set forth by the Agriculture Improvement Act of 2018 (“2018 Farm Bill”), and in turn, violated the state law.
The dispensary’s owner stated that the store was targeted “because we’re pushing a lot [of Delta-8] onto the market.” Wisconsin State law permits the sale of CBD products so long as the products contain no more than 0.3% THC level, consistent with 2018 Farm Bill. Notwithstanding, the legal status of Delta-8 is unclear largely due to the conflict between 2018 Farm Bill and a Drug Enforcement Administration (“DEA”) regulation. More specifically, the 2018 Farm Bill essentially removed all hemp-derived cannabinoids including Delta-8 from schedule I of the Controlled Substances Act (“CSA”) while DEA’s Interim Final Rule indicated that “[all] synthetically derived tetrahydrocannabinols remain schedule 1 controlled substances.” Thus, Delta-8 manufactured from hemp-derived CBD is considered a controlled substance under the federal law. In a similar vein, Delta-8 has not been directly addressed byWisconsin State law. However, we can glean from the current law, i.e., 2019 Wisconsin Act 68 on the State’s perspective on Delta-8. According to the Act 68, “cannabidiol product” is defined as a derivative or extract of the plan Cannabis sativa L. that contains cannabidiol and a THC concentration at a level without a psychoactive effect.
How Frier Levitt Can Help
Regulation of hemp and its derivative products remains mired in a jumble of conflicting and unclear state and federal law. Also, law enforcement’s wrongful seizure demonstrates a lack of knowledge and understanding of CBD, which may lead to business interruption and financial loss. Stakeholders should make sure they have a Plan of Action to address wrongful seizure and surrounding criminal issues, as well as appropriate commercial insurance coverage to mitigate the economic risks. If your company handles hemp and its derivatives, contact us today to speak to an attorney.

FTC’s First Monetary Sanctions Against Six CBD Companies

Posted on December 23, 2020 by - Government Affairs, Pharmacy

On December 17, 2020, the Federal Trade Commission (“FTC” or “Commission”) announced that the Commission entered into settlements with six sellers of CBD-containing products.  The settlements were the result of the Commission’s enforcement sweep called “Operation CBDeceit,” which is the Commission’s ongoing effort to protect consumers from false, deceptive, and misleading health claims made by CBD companies.  In the settlements, the FTC has ordered each of the companies and the officers to immediately stop making unsupported health claims and pay monetary judgments to the FTC.  This recent enforcement is a significant development in the CBD industry for reasons discussed below.
This is the first enforcement action whereby the FTC imposed monetary sanctions upon CBD companies as well as the corporate officers for claiming unsubstantiated health claims.  The FTC claims that the violators including the corporate officers made a wide range of scientifically unsupported claims about their products’ ability to treat serious health conditions, including cancer, heart disease, hypertension, Alzheimer’s disease, and others.  These allegations are no different than the ones made by the FTC or the Food and Drug Administration (“FDA”) in prior enforcement actions.  What is unique about the recent settlements is that the Commission is holding the corporate officers responsible for participating in the illicit marketing of the CBD products.  It is axiomatic that the Commission will continue to enforce strict regulations over not only the CBD companies but also the corporate officers. Moreover, the violators were ordered to notify consumers about the settlements through various means.  For example, one of the companies was ordered to provide a notice on all of its social media accounts including Facebook, Twitter, Instagram, or YouTube as well as on the first page of the company’s website.  The notice must include a copy of the order.  Furthermore, five of the six settlements required the violators to pay damages ranging from $20,000 to $85,000.
Certainly, the FTC’s recent enforcement action is a key development in the CBD regulation while the industry has proliferated exponentially over the last couple years.  Additionally, there has been a series of lawsuits, which mimicked allegations raised in the FDA’s warning letters, filed against CBD companies.  It is imperative that CBD stakeholders promoting their products in line with applicable Federal and State laws.
How Frier Levitt Can Help
Given the possibility of lawsuits as well as conflicting state and federal law that only complicate regulations on hemp and its derivative products, CBD stakeholders should seek competent counseling to mitigate the risks of unwanted attention by the government or civil lawsuits.  Also, a cursory search using the search terms hemp revealed over 4,000 trademarks and applications. Clearly, the United States Patent and Trademark Office has opened the door for hemp containing products.  The trademarkabilty of such products and services is a nuanced and evolving issue.  If your company handles hemp and its derivatives, contact us today to speak to an attorney.

Navigating the USPTO’s Pathway for Trademark Registration of Cannabis and Cannabis-Related Goods and Services

Posted on February 28, 2020 by - Government Affairs

In May 2019, the United States Patent and Trademark Office (USPTO) issued an Examination Guide (Guide) outlining a pathway for trademark registration for certain cannabis and cannabis-related goods and services (including CBD). This reversed its previous policy prohibiting any cannabis-related trademark registrations. As a result of the USPTO’s Guide and the anticipated competitive business environment of this field, we expect to see a significant influx of cannabis-related trademark applications. Brand protection is important in all industries and cannabis-related companies spending time, effort and money branding their products understand the benefits of a federal trademark (notable examples include Marley Natural™ and Leafs by Snoop™) (Snoop Dogg).

Benefits of brand protection include:

• Ability to use the registered trademark symbol (®) to put others on notice that your brand exists and is protected

• Incontestability after 5 years of continuous use

• A basis for foreign registrations

• Use of U.S. Customs and Border Protection to block imports that infringe on the mark

• Prevention of loss of goodwill (and sales) by inferior infringing products

• Intellectual Property value added in licensing agreements and merger and acquisitions

The key provisions of the USPTO Guide are:

• To be eligible for Federal Trademark protection the goods and services must be hemp-derived and must have less than 0.3% tetrahydrocannabinol (THC). The trademark application must
explicitly state this is the case.

•  The underlying product or service must be legal under federal law, including the Agriculture Improvement Act of 2018 (2018 Farm Bill) (which made hemp-derived cannabis products with THC
less than 0.3% federally legal), and under state law. The USPRO reiterated its position that trademarks relating to illegal goods and services are not eligible for trademarks, even if they are legal
under state (but not federal) laws.

• USPTO will determine the legality of the product or services (i.e. trademarkability) based on an analysis of: The Controlled Substances Act (CSA), The Federal Food Drug and Cosmetic Act
(FDCA), and The Farm Bill.

• USPTO will take into account Food and Drug Administration (FDA) and U.S. Department of Agriculture (USDA) regulations when determining “lawful use” issues. For example, FDA restrictions exist for hemp-derived foods, beverages, dietary supplements or pet treats which will affect trademarkability.

• The application filing date must be after December 20, 2018. For applications filed prior to that date, Applicants may either amend the application to change the date or file a new application.

How Frier Levitt Can Help
A cursory search using the search terms cannabis or hemp revealed over 4,000 trademarks and applications. Clearly, the USPTO has opened the door for cannabis-related trademarks (including for CBD products). The trademarkabilty of such products and services is a nuanced and evolving issue. For assistance in navigating the trademark examination process for cannabis marks, contact Frier Levitt, LLC.

FDA and Florida are Taking Opposite Stance on Ingestible CBD

Posted on January 20, 2020 by - Government Affairs

As part of an ambitious new state hemp program, the Florida Department of Agriculture and Consumer Services (the “Department”) announced that new food safety and animal feed rules went into effect as of January 1, 2020. Agriculture Commissioner Nikki Fried stated that the new regulations are crucial in “getting the state hemp program up and running to provide a new alternative crop for farmers, allow Floridians to access safe, quality CBD products, and help [the] state reach its potential as the nation’s gold standard for hemp.” These new regulations are intended to support the continued sale of hemp and its derivatives products, including CBD, while ensuring that consumers are protected.

Under the new regulations, any hemp extract or product containing hemp extract intended for human ingestion and for animal ingestion will be regulated by the Department. Any business that manufactures, processes, packages, holds, prepares or sells food made from or containing hemp extract is required to obtain a Hemp Food Establishment Permit to operate in Florida. Food consisting of hemp or hemp extract (including CBD) must be obtained from an “Approved Source” that meets certain local, state or federal food safety standards. Such foods are also subject to specific labeling requirements. Food containing hemp extract must have a THC concentration of less than 0.3% on a dry weight basis and the food must contain less than set limits of certain contaminants used in the hemp cultivation process. As part of the on-going efforts to minimize risk of foodborne illnesses, the Department will conduct routine inspections on such businesses.

Significantly, the new regulations allowing sale of ingestible hemp and hemp-derivative products runs counter to the United States Food and Drug Administration’s (FDA) current stance on these products. Despite the 2018 Farm Bill legalizing hemp with a THC concentration of less than 0.3% on a dry weight basis, CBD products are still subject to FDA’s laws and regulations, including those that apply to foods, beverages and dietary supplements. In this vein, FDA stated that “[i]t is currently illegal to market CBD by adding it to a food or labeling it as a dietary supplement.”

In the wake of FDA’s regulations on CBD products, a spate of class action lawsuits have been filed by consumers against CBD manufacturers mimicking FDA’s concern over illegal sale of CBD products including ingestibles for human and animal consumption. Meanwhile, U.S. District Judge Ursula for the Southern District Court of Florida in a class action lawsuit ruled on January 3, 2020 that a CBD manufacturer should not face certain liability claims until FDA finishes work reviewing CBD policy. In her opinion, Judge Ursula stated that the FDA’s current rules “provide little guidance with respect to whether CBD ingestibles, in all their variations are food supplements, nutrients or additives and what labeling standards are applicable.”

How Frier Levitt Can Help
Certainly, Florida’s newly enacted regulations have opened a door while further complicating the legality of ingestible hemp and hemp-derived products, which in turn impact industry Stakeholders including the extractors, manufacturers, wholesalers, and retailers. While many states will choose to wait until FDA issues its much-anticipated regulatory framework for hemp-derivative and CBD products, we envision that more states may take the necessary steps to enact regulations similar to Florida’s. Given the clash between federal and state laws, it is crucial for Stakeholders in the hemp industry to understand the current laws and regulations. If you need assistance navigating the regulatory environment for hemp, CBD or other cannabis-derived products, contact Frier Levitt today to speak with an attorney.

New York State Passes New Law Establishing Regulatory Framework for Hemp and Hemp Extracts, Including CBD

Posted on December 16, 2019 by - Pharmacy

By: Adam S. Bloom, Esq.

On December 9, 2019, New York Governor Andrew Cuomo signed legislation that impacts the state’s cannabidiol (CBD) businesses. The law establishes a regulatory framework for the growth, sale, distribution, transportation, and processing of industrial hemp and hemp extracts, including CBD, with a THC concentration of not more than 0.3 percent on a dry weight basis. The law establishes licensing, good manufacturing practice standards, testing, and labeling requirements for the industry. Governor Cuomo also announced that New York State will host a hemp summit in January 2020 to further develop industry policies.

Under the law, retailers, wholesalers, manufacturers, and extractors of products derived from hemp extract – including CBD – must apply for a license from the New York Department of Agriculture and Markets. The Department will establish regulations governing this process as well as regulations covering the labeling and advertising of such products.

In addition, among other requirements, hemp extract products must be sold or delivered in containers with labels as may be required by the state, must be extracted and manufactured in accordance with good manufacturing processes pursuant to FDA good manufacturing practices, and every cannabinoid manufacturer and extractor must contract with an independent laboratory to test their hemp extract products.

While countless businesses await legal clarity regarding their ability to add CBD to foods, drinks, and dietary supplements, the New York law defers decision-making on this issue until a later date. The State appears to be waiting to see whether the Federal Food and Drug Administration (FDA) establishes regulations allowing for the marketing of CBD in foods and beverages and likely will follow FDA’s lead at that time.

Federal and state laws regarding hemp, CBD, and other cannabis-derived products are rapidly evolving and there are many potential pitfalls for operating in these markets without a thorough understanding of the complex regulatory environment. If you need assistance navigating the regulatory environment for hemp, CBD or other cannabis-derived products, contact Frier Levitt today to speak with an attorney.

CBD ALERT: Class Action Lawsuits Filed Against CBD Manufacturers

Posted on December 9, 2019 by - Government Affairs

By: Dae Y. Lee, Pharm.D., Esq., CPBS

Six class action lawsuits have been filed against cannabidiol (CBD) manufacturers immediately following the November 25, 2019 warning letters issued by the United States Food & Drug Administration (FDA). These warning letters were sent to 15 companies for selling products containing CBD. The FDA maintains that food and dietary supplements are not allowed, under the Food, Drug, and Cosmetic Act (FD&C Act), to contain any level of CBD. The FD&C Act makes it clear that any product intended to treat a disease or otherwise have a therapeutic or medical use, and any product (other than food) that is intended to affect the structure or function of the body of humans or animals, is a drug. The FDA has not approved any CBD products other than Epidiolex for the treatment of seizures associated with two rare and severe forms of epilepsy. The FDA has sent numerous warning letters to companies that sell CBD products in interstate commerce that claimed to prevent, diagnose, mitigate, treat or cure serious diseases. However, the FDA has not launched a judicial action against a CBD manufacturer.

The class action lawsuits are identical to each other and each complaint mimics the FDA’s concerns over illegal sale of the CBD products. Four cases, DaSilva v. Infinite Product Co. LLC, Davis v. Green Roads of Florida, LLC, McCarthy v. Charlotte’s Web Holdings, Inc., and Colette v. CV Sciences, Inc., alleging that the manufacturers’ CBD products were mislabeled as dietary supplements. Two cases, McCarthy v. Elixinol, LLC, and Fausett v. KOI CBD, LLC, note that the defendants sold CBD products as dietary supplements as well as animal foods. KOI CBD, LLC is among the 15 companies that received the most recent FDA warning letters. Prior to these lawsuits, there have been several lawsuits that have been filed against CBD manufacturers including a shareholder class action lawsuit filed against Curaleaf Inc. when the company’s stock fell abruptly after it received a warning letter from the FDA.

The recent lawsuits suggest a new wave of litigation in the CBD industry given that the FD&C Act does not provide for a private right of action under which members of the public can commence a civil action to enforce the FD&C Act. The putative classes assert, instead of arguing that the use of CBD in products violates the FD&C Act, that the CBD products are mislabeled and falsely advertised under state consumer protection laws. More specifically, the plaintiffs allege that the defendants manufactured and sold CBD products in violation of California and Arizona state laws including, but not limited to, California’s Unfair Competition Law, False Advertising Law, and Consumer Legal Remedies Act, and Arizona’s Consumer Fraud Act.

Many future lawsuits are expected to focus on allegations of mislabeling, accusing the companies of falsely representing the CBD content of their products. The lawsuits will likely involve not only the manufacturers but also other stakeholders in the supply chain including extraction and remediation companies. CBD stakeholders should prepare for the possibility of litigation and actively seek to mitigate the risks of unwanted attention by FDA or civil lawsuits. It is likely that more issues will surface given the ever-evolving regulations in the CBD industry. Frier Levitt helps CBD companies and manufacturers navigate complex issues, including many services based on flat fees. Contact Frier Levitt today to speak to an attorney.

FDA Issues 15 New Warning Letters to CBD Companies and Publishes Consumer Update

Posted on December 2, 2019 by - Government Affairs

By: Adam S. Bloom, Esq. and John E. Morrone, Esq.

On November 25, 2019, the Food and Drug Administration (FDA) issued warning letters to 15 companies selling cannabidiol (CBD) and published a revised Consumer Update broadly detailing its safety concerns regarding CBD products. In addition, the FDA said it intends to provide an update “in the coming weeks” on its progress towards developing a regulatory approach to CBD products.

Each of the companies that received warning letters sold their products online in “interstate commerce.”  The products sold include a wide range of CBD products including oils, creams, tinctures, capsules, dietary supplements, human foods (such as gummies and chocolates) and animal foods. As has been the case in each of their previous CBD-related warning letters, the FDA focused its attention on companies that market CBD products with claims that the products cure, mitigate, treat or prevent diseases such as cancer, diabetes, opioid addiction, schizophrenia, multiple sclerosis, autism, Crohn’s disease, depression, and arthritis.

Although each of the targeted companies made illegal disease claims, the FDA made it a point to emphasize that the CBD foods (including animal foods) and dietary supplement products were in further violation of the Food, Drug and Cosmetic Act (FDCA). The FDA stated it is illegal to introduce into interstate commerce human or animal food containing CBD because CBD is an unapproved food additive – it is not Generally Recognized as Safe (GRAS) among qualified experts, and no food additive regulation authorizes its use in foods. The FDA also noted that CBD cannot be marketed as a dietary supplement because it does not meet the definition of a dietary supplement under the FDCA.

Additionally, the FDA emphasized its concern with the marketing of CBD products to children. For example, they called out a CBD product named “Asteroid Gummies” which was advertised with the claim that consumers can give the product “as a treat to your kid[.]”

Significantly, in the revised Consumer Update, the FDA conveyed its belief that there are many unanswered questions and data gaps about CBD safety and that the limited data it has seen regarding CBD point to “real risks.” The FDA’s safety concerns regarding CBD include potential liver injury, the effect of interactions with other drugs, drowsiness, diarrhea, changes in mood, effects on male reproductive health, impact on vulnerable populations such as children and pregnant or breast-feeding women, and the cumulative effects of CBD use.

In an FDA press release issued in conjunction with the warning letters and the revised Consumer Update, the FDA Principal Deputy Commissioner Amy Abernathy, M.D., Ph.D., emphasized that they are monitoring the CBD marketplace and will take action against companies that “violate the law in ways that raise a variety of health concerns.” She added that FDA believes there are “knowledge gaps” about the science, safety, and quality of many CBD products and that the FDA is concerned that people wrongly believe many CBD products have been evaluated by the FDA and determined to be safe or that trying CBD “can’t hurt.”

By issuing 15 new warning letters and articulating its concerns regarding CBD safety, FDA has reiterated its commitment to overseeing the CBD industry and demonstrated the risks of marketing CBD products without a thorough understanding of the unsettled and complex CBD regulatory environment. If you need assistance navigating the regulatory environment for CBD or other cannabis-derived products, contact Frier Levitt today to speak with an attorney.

USDA Establishes Hemp Regulatory Framework

Posted on November 5, 2019 by - Government Affairs

By: Adam S. Bloom, Esq. and John E. Morrone, Esq.

On October 29th, 2019, the U.S. Department of Agriculture (USDA) released an interim final rule establishing a national regulatory framework for domestic hemp cultivation. The interim rule is intended to facilitate and expand production and sales of domestic hemp and marks a major milestone in the establishment of a nationwide hemp industry.

The interim rule creates baseline requirements for hemp production but allows states and Native American tribes to establish more restrictive plans, subject to USDA approval. If a state does not implement its own plan, the USDA plan will apply. Also, notably, the rule prohibits states and tribes from banning the interstate transport of hemp that has been legally grown under the program.

The interim rule includes requirements regarding collecting and maintaining relevant information on the land used for hemp production; procedures for sampling and testing to ensure the cannabis grown and harvested does not exceed the acceptable hemp THC level (no greater than 0.3% THC concentration level on a dry weight basis); procedures for ensuring effective disposal of plants exceeding the acceptable hemp level; compliance procedures to ensure hemp is being produced in accordance with applicable requirements including conducting annual inspections and procedures for handling violations; and procedures for reporting specific requirements to the USDA.

The USDA also issued guidelines for sampling and testing procedures for hemp. Samples, which have to be collected approximately two weeks prior to a crop’s anticipated harvest date, must be tested at Drug Enforcement Administration (DEA)-registered laboratories.

There is a 60-day comment period during which interested persons may submit comments on the interim rule. After reviewing and evaluating the comments, USDA will draft and publish a final rule within two years.

Federal and state laws regarding hemp, CBD, and other cannabis-derived products are rapidly evolving and there are many potential pitfalls for operating in these markets without a thorough understanding complex regulatory environment for such products. If you need assistance navigating the regulatory environment for hemp, CBD or other cannabis-derived products, contact Frier Levitt today to speak with an attorney.

Federal Trade Commission Issues New Warning Letters for CBD Products

Posted on September 20, 2019 by - Government Affairs

On September 10, 2019, the Federal Trade Commission (FTC) issued warning letters to three unidentified companies that sell cannabidiol (CBD) products with claims that the products treat or cure serious diseases or health conditions. The warning letters send a message to the CBD industry that any such claims must be supported by sound scientific data.  Specifically, FTC requires competent and reliable scientific evidence to support any claims that a product prevents, treats or cures a medical condition.

One company claimed that its CBD product relieves pain better than prescription opioid painkillers, and was “clinically proven” by “thousands of hours of research” to treat cancer, Alzheimer’s disease, multiple sclerosis, fibromyalgia and colitis.

A second company claimed that its CBD products are proven to treat a litany of serious diseases including autism, anorexia, schizophrenia, ALS, stroke, Parkinson’s disease, Crohn’s disease and AIDS.

The third company claimed its CBD gummies were highly effective in treating “the root cause of most major degenerative diseases, including arthritis, heart disease, fibromyalgia, cancer, asthma, and wide spectrum of autoimmune disorders” along with various other serious conditions.

FTC warned these companies that selling CBD products without competent and reliable scientific evidence substantiating their claims could violate the FTC Act and may result in legal action resulting in penalties including injunction and the return of money to consumers.

These warning letters echo the March 2019 warning letters sent jointly by FTC and the Food and Drug Administration warning companies against making disease claims without adequate substantiation.

This latest round of warning letters highlights the potential pitfalls of marketing CBD products without a thorough understanding of the unsettled and complex regulatory environment for such products. If you need assistance navigating the regulatory environment for CBD or other cannabis-derived products, contact Frier Levitt Government Affairs to speak with an attorney.

FDA Announces it is Expediting Review of CBD

Posted on July 15, 2019 by - Government Affairs

On July 12, 2019, Food and Drug Administration (FDA) Principal Deputy Commissioner Dr. Amy Abernathy announced via Twitter that the FDA is expediting its work to address the regulation of cannabidiol (CBD). She stated that FDA intends to report on its progress “around end of summer/early fall.”

Dr. Abernathy added that the FDA is enthusiastic about research into the therapeutic benefits of CBD products but reiterated the need to balance safety concerns. She also acknowledged the intense interest around this issue by saying that in addition to the over 100 speakers who presented at the May 31 FDA public hearing on cannabis products, there have been 3,417 comments submitted to the public docket (with four days remaining before the July 16 deadline).

Congress has also recently pressed the FDA for expedited action on CBD regulation. Senator Ron Wyden, D-Ore., sent the FDA a letter on June 25 urging the FDA to promptly issue guidance that ensures a regulatory pathway for the lawful use of hemp-derived CBD as a food additive and as an ingredient in dietary supplements. He called for FDA to issue an “enforcement discretion guidance” by August 1.

On the other side of the aisle, Senator Mitch McConnell, R-KY, met with Acting FDA Commissioner Dr. Ned Sharpless on June 28 and urged him to develop regulations to allow hemp-derived CBD to be lawfully marketed.

The House also recently passed an amendment to appropriations legislation directing FDA to “undertake a process to make lawful a safe level for conventional foods and dietary supplements containing [CBD] so long as the products are compliant with all other FDA rules and regulations.”

The emerging CBD industry creates opportunities for current participants in the drug supply chain, physicians, and other healthcare providers. However, anyone either currently involved in marketing or providing CBD products or those desiring to get into the CBD market should engage qualified guidance. Frier Levitt Government Affairs and Frier Levitt are committed to the healthcare industry and can provide sage advice to providers. Contact us today.