Tag: FDA

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.

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.

USDA Extends Public Comment Period on Hemp Production Program

Posted on January 7, 2020 by - Government Affairs

The U.S. Department of Agriculture (“USDA”) has announced a notice of comment period extension on the Hemp Production Program Interim Final Rule allowing hemp stakeholders to submit comments until January 29, 2020. By way of brief background, the Agriculture Improvement Act of 2018 (“2018 Farm Bill”) required USDA to establish the Program, which attempts to clarify the regulatory frame for States and Indian Tribes for the domestic production of hemp.

The Rule outlines provisions for the States and Indian Tribes to submit hemp plans for USDA approval. It also establishes THC testing protocols, interstate transportation, licensing protocols, and eligibility rules for federal programs (e.g., loan and crop insurance programs). More specifically, by and through the Rule, USDA is imposing strict sampling and testing requirements to ensure that the hemp does not contain THC exceeding 0.3%. However, farmers would not be considered in violation of the Rule unless the hemp crops contain THC exceeding 0.5%. Notwithstanding this, farmers are required to dispose any hemp crops with 0.3% – 0.5% THC. Furthermore, the Rule allows hemp to be transported across state lines even in the instances where the state does not authorize hemp production. Of note, states may enact stricter regulations impacting the production, transportation, and sale of the hemp and its derivatives.

As indicated above, the Rule provides much needed guidance to producers and farmers. However, it does not have any bearing on the FDA’s regulation on the hemp and its derivatives in food, beverage or dietary supplements. In other words, stakeholders in the hemp industry must comply with not only FDA and USDA regulations but also state laws that are often not in line with the federal regulations.  Moreover, the Rule does not address several key issues including, but not limited to, seed certification, total THC testing instead of the delta-9 tetrahydrocannabinol testing, and the potential issues arising from testing out of only Drug Enforcement Administration registered labs.

With the exponential growth in the hemp industry and the growing regulatory concerns, Stakeholders should review the Rule in detail and submit comments to USDA. Frier Levitt assists state and national associations around the country in drafting proposed legislation. Our “request for comment” work has played a prominent role on important national issues. If you want to learn more about the Interim Final Rule or would like to submit comments before January 29, 2020, contact Frier Levitt today.  Time is of the essence.

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.

The FDA and FTC issue Warning Letter to Florida CBD Company for Unsubstantiated Disease Claims and Marketing to Children

Posted on October 23, 2019 by - Government Affairs

On October 10, 2019, the Food and Drug Administration (FDA) and the Federal Trade Commission (FTC) issued a joint warning letter to Florida-based Rooted Apothecary, LLC, for selling cannabidiol (CBD) products with unsubstantiated claims that the products treat or cure a variety of serious diseases and health conditions, including claims that the products treat certain conditions in infants. The warning letter reflects the FDA’s continuing concern over CBD products marketed for therapeutic or medical uses, and emphasizes the FDA’s concern over CBD products marketed for use by infants and/or children.

The FDA found various products marketed by Rooted Apothecary to be unapproved new drugs because the company’s website and its social media website included claims that the products are intended to diagnose, cure, mitigate, treat or prevent diseases including Parkinson’s, Alzheimer’s, depression, anxiety, PTSD, attention deficit/hyperactivity disorder (ADHD), cancer, and diabetes.

In addition, the FDA found that Rooted Apothecary unlawfully marketed certain CBD products as dietary supplements. As noted in previous warning letters, the FDA considers products containing CBD to be excluded from the definition of dietary supplements because CBD is the active ingredient in the FDA-approved drug Epidiolex, and CBD was not marketed as a dietary supplement or conventional food prior to the authorization of the clinical investigations of Epidiolex.

The FDA was particularly concerned that Rooted Apothecary markets certain CBD products to infants and children. For example, the company claimed that the “Teeth/TMJ – Essential Oil + CBD Infusion” product will “help calm the inflammation and pain of teething, while also promoting sleepiness for your little one.” The “Ears – Essential Oil + CBD Infusion” product included the claim, “We formulated this for the entire family including our precious little ones.” Further, the company’s website included webpages with statements such as “CBD oil . . . seems like an attractive and safe option for children” and “children can use high amounts of CBD safely and without any risk.”

Regarding the warning letter, Acting FDA Commissioner Ned Sharpless, M.D., said, “We are working to protect Americans from companies marketing products with unsubstantiated claims that they prevent, diagnose, treat or cure a number of diseases or conditions. This is especially concerning when companies are peddling unproven CBD products for use in vulnerable populations like infants and children.” Dr. Sharpless added, “We’ve sent numerous warning letters that focus on matters of significant public health concern to CBD companies, and these actions should send a message to the broader market about complying with FDA requirements.”

The FTC warned Rooted Apothecary that it is concerned that the company lacks the requisite “competent and reliable scientific evidence” to substantiate claims that its products can prevent, treat or cure human disease.

This latest warning letter from the FDA and FTC again 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 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.

FDA Extends Comment Period on Products Containing Cannabis

Posted on June 20, 2019 by - Government Affairs

The FDA has announced a notice of a comment period extension. The FDA originally solicited the industry in an April 3, 2019 notice, seeking comments to obtain scientific data and information about the safety, manufacturing, product quality, marketing, labeling, and sale of products containing cannabis or cannabis-derived compounds.

In addition to establishing a docket for public comment from its May 31, 2019 public hearing on the issue, the FDA has now extended its comment period until July 16, 2019.

If you are interested in submitting comments to the docket or need assistance navigating the unsettled and complex regulatory environment for cannabis-derived products including CBD, Frier Levitt Government Affairs and Frier Levitt, LLC can help. Contact us today.