Legal Overview of CBD in the United States

Both cannabidiol (CBD) and tetrahydrocannabinol (THC) are cannabinoids—chemical compounds—that can be extracted from Cannabis sativa L. Even though their chemical structures are similar, CBD and THC target different receptors in humans, thus carrying out different functions. The well-known psychoactive effect is caused by THC, which targets cannabinoid receptors. Despite the potential side effects, THC has been used to treat anorexia in people with HIV/AIDS,¹ as well as for refractory nausea vomiting in people undergoing chemotherapy.² CBD, on the other hand, exhibits low affinity to cannabinoid receptors and, so far, has proved to have little to do with the psychotropic effect of cannabis. According to recent research, CBD’s interactions with other receptors contribute to its antidepressant,^3,4 anxiolytic⁵ and neuroprotective^6,7 effects.

Products containing CBD are getting more popular. Most of the products selling online are CBD oil, spray or powder. Hemp Business Journal estimated US$450 million of the projected $2.1 billion in sales by 2020 will come from hemp-based sources. The hemp-derived CBD market was $90 million in 2015.

Source of CBD

CBD mainly comes from industrial hemp and marijuana. Industrial hemp and marijuana are different varieties of the same plant species, Cannabis sativa L. According to USDA’s January 2000 report “Industrial Hemp in the United States”: “Marijuana and industrial hemp are different varieties of the same plant species; Cannabis sativa L. marijuana typically contains 3 to 15 percent THC on a dry-weight basis, while industrial hemp contains less than 1 percent.^8,9 Most developed countries that permit hemp cultivation require use of varieties with less than 0.3 percent THC. However, the two varieties are indistinguishable by appearance. A study of 97 cannabis strains concluded that short of chemical analysis of the THC content, there was no way to distinguish between marijuana and hemp varieties.”¹⁰

Regulation

DEA—Due to the complexities of cannabis extracts, on Dec. 14, 2016, DEA implemented a rule regarding marijuana extracts called “Final Rule Establishing A New Controlled Substance Code Number (Drug Code) for Marijuana Extract.” The DEA definition for “marijuana extract” is an extract containing one or more cannabinoids that has been derived from any plant of the genus cannabis, other than the separated resin (whether crude or purified) obtained from the plant.

On March 9, 2017, DEA published a “Clarification of the New Drug Code (7350) for Marijuana Extract.” According to the clarification: “Because recent public inquiries that DEA has received following the publication of the final rule suggest there may be some misunderstanding about the source of cannabinoids in the cannabis plant, we also note the following botanical considerations. As the scientific literature indicates, cannabinoids, such as tetrahydrocannabinols (THC), cannabinols (CBN) and cannabidiols (CBD), are found in the parts of the cannabis plant that fall within the CSA [Controlled Substances Act] definition of marijuana, such as the flowering tops, resin and leaves.”

USDA—On Feb. 7, 2014, the Agricultural Act of 2014 (aka, the Farm Bill) contained section 7606 titled “Legitimacy of Industrial Hemp Research,” and  gave authorization to state departments of agriculture and institutions of higher learning in states that have legalized hemp cultivation to grow the crop for research and pilot programs.

The USDA definition for “industrial hemp” is that which “includes the plant Cannabis sativa L. and any part or derivative of such plant, including seeds of such plant, whether growing or not, that is used exclusively for industrial purposes (fiber and seed) with a tetrahydrocannabinols concentration of not more than 0.3 percent on a dry-weight basis.”

FDA—Based on available evidence, FDA has concluded THC and CBD products are excluded from the dietary supplement definition under sections 201(ff)(3)(B)(i) and (ii) of the Federal Food, Drug, and Cosmetic Act (FD&C), respectively. Under those provisions, if a substance (such as THC or CBD) is an active ingredient in a drug product that has been approved under 21 U.S.C. § 355 (section 505 of the FD&C), or has been authorized for investigation as a new drug for which substantial clinical investigations have been instituted and for which the existence of such investigations has been made public, then products containing that substance are outside the definition of a dietary supplement. FDA considers a substance to be "authorized for investigation as a new drug" if it is the subject of an investigational new drug application (IND) that has gone into effect. Under FDA’s regulations (21 CFR 312.2), unless a clinical investigation meets the limited criteria in that regulation, an IND is required for all clinical investigations of products that are subject to section 505 of the FD&C.

There is an exception to sections 201(ff)(3)(B)(i) and (ii) if the substance was "marketed as" a dietary supplement or as a conventional food before the drug was approved or before the new drug investigations were authorized, as applicable. However, based on available evidence, FDA has concluded that this is not the case for THC or CBD.

The existence of substantial clinical investigations regarding CBD has been made public. For example, two such substantial clinical investigations include GW Pharmaceuticals’ investigations regarding Sativex® and Epidiolex®.

Over the past few years, FDA issued several warning letters to firms marketing unapproved new drugs that allegedly contained CBD. As part of these actions, FDA tested the chemical content of cannabinoid compounds in some of the products, and many were found to not contain the levels of CBD they purported.

Future

The CBD and hemp market will continue to grow in the future; however, the legal status of CBD will be an ongoing challenge for the food and dietary supplement industries.

Jianbo (Dave) Huang is the product specialist at Davidia Healthtech (davidiahealthtech.com), a nutraceutical company based in San Diego. Huang received his bachelor’s degree in biochemistry at University of California, San Diego, and is currently finishing his master’s in medicinal chemistry.

Dave’s work in Davidia Healthtech includes doing literature research on the bioavailability, functionality and regulatory affair regarding the active ingredient of products.

Hua Deng, Ph.D., is the president and founder of Davidia Healthtech LLC, a professional service company for food, dietary supplement and cosmetics brands. Deng holds a doctorate from Lanzhou University in China with a major in analytical chemistry. She has extensive experience with global regulatory affairs in the food, dietary supplement and cosmetic industries.

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