2 Lessons for CBD Industry in Recent FDA Warning Letter

With a pointed warning letter to a seller of cannabidiol (CBD) products, the Food and Drug Administration (FDA) last week sent a reminder to the industry: follow FDA labeling guidelines when marketing CBD and hemp products. The July 22, 2019 letter to Curaleaf, Inc. received more public attention than is typical and focused on products like “CBD Lotion,” “CBD Pain-Relief Patch,” “CBD Tincture,” “CBD Disposable Vape Pen” and “Bido CBD for Pets.” FDA called out two marketing aspects that troubled the agency.

First, consistent with past comments, FDA stated bluntly that “CBD products are excluded from the dietary supplement definition under sections 201(ff)(3)(B)(i) and (ii) of the FD&C Act, 21 U.S.C. 321(ff)(3)(B)(i) and (ii).” This statement is a reminder that despite the 2018 Farm Bill, certain hemp substances, including cannabidiol extracts, have a questionable regulatory and safety status in the eyes of FDA and some state governments.

But the second and more likely trigger for the action was the marketing claims that were associated with the Curaleaf products. The FDA scrutinized Curaleaf’s website, blog and social media posts on Facebook and Twitter and found claims like:

• “CBD has also been shown to be effective in treating Parkinson’s disease.”
• “CBD has been linked to the effective treatment of Alzheimer’s disease. …”
• “CBD is being adopted more and more as a natural alternative to pharmaceutical-grade treatments for depression and anxiety.”

These clear drug claims related to treating or preventing diseases made it easy for the agency to conclude that the products could be classified as unapproved new drugs that were also misbranded. Since Curaleaf sold products on its site, the claims clearly fell within FDA’s definition of “labeling.”

The excitement about hemp and CBD products is amplified when a publicly traded company receives this type of attention from the agency. And it’s a safe bet that FDA chose Curaleaf because the agency wanted to send a message to similar companies about knowing and following fundamental claim regulations. That possibility is reinforced by the fact that (1) Curaleaf is in Boston, (2) the letter is dated for July 22, and (3) there just happened to be a July 23 Food and Drug Law Institute Meeting in Boston about CBD, which amplified the impact.

The stock market took notice of the enforcement action and was not kind to Curaleaf or similar stocks. However, Curaleaf noted on Friday, July 26, that it had scrubbed the offending claims from its website and was committed to compliance. The stock market appeared to reward this type of responsible message.

The key takeaway is that fundamental regulatory compliance matters. The full list of Curaleaf’s claims reinforce best practices for drafting and substantiating claims appearing on labels of any dietary supplement or food — not just those containing hemp or CBD. Companies should always confirm that claims are within the bounds allowed for dietary supplements or food. And if the claim is on a product that contains a high-profile ingredient already under scrutiny for regulatory discretion, then it is doubly important to comply with regulations about drug claims, substantiation and other labeling enforced by FDA.