Calling all signs, it's 2023! Start your new year off with the perfect strain to set you on the right path this January.
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Even though voters approved legalization in November, the state has been slow to legalize possession.
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There has been so much talk from the Food and Drug Administration (“FDA”) around cannabidiol (“CBD”) regulations that it makes one’s head spin. For years everyone has wondered when, or even if, the FDA would propose and adopt CBD regulations. To date, while taking input from the public on the topic, the FDA mostly has engaged in enforcement, sometimes in tandem with Federal Trade Commission (“FTC”), against CBD retailers. Now though, it sounds like FDA is serious about CBD regulations in the context of both food and supplements.
Until recently, CBD resided in a legal penumbra where hemp was still scheduled on the federal Controlled Substances Act and could not be cultivated without a permit from the Drug Enforcement Administration (“DEA”). With the passage of the 2014 Farm Bill, CBD derived from hemp — if cultivated pursuant to a state research pilot program — got a little bit of precarious legal cover. None of that stopped the FDA from taking the position that CBD is not a supplement, and that it cannot be an ingredient in food and beverages for humans or pets without violating the Food, Drug & Cosmetic Act (“FDCA”). And marketing any bodily or curative effects of CBD was (and still is) off limits. Accordingly, the FDA routinely sent out enforcement letters to a variety of CBD retailers.
In 2018, the federal government legalized hemp and all of its derivatives, including CBD, with the passage of the Agriculture Improvement Act of 2018 (better known as the “2018 Farm Bill”). The 2018 Farm Bill didn’t regulate CBD though. Instead, it recognizes FDA’s authority to regulate products containing hemp-derived products, including CBD. Moreover, Congress has repeatedly urged the FDA to complete the rulemaking process to solve the proliferation of CBD products, particularly for foods and dietary supplements, that are being sold in apparent violation of the FDCA. Yet, since the passage of the 2018 Farm Bill, the FDA has yet to adopt formal regulations, and it’s still sending out those enforcement letters (with FTC active, too).
An interesting and complicating factor is that despite the FDA dragging its feet around CBD, various states have decided to proceed with their own CBD regulations for food and beverages. A multitude of states now allow CBD in food and drinks for consumption by humans and animals.
In a Wall Street Journal interview released on December 27, 2022, FDA “agency officials” stated that ” . . . the FDA will decide within months how legal cannabis should best be regulated and whether that will require new agency rules or new legislation from Congress . . .” This decision though is only going to come after the FDA fully studies the effects of consuming CBD via food and supplements. And the decision is an important one because, among other things, it will likely inform us all whether or not CBD can be used safely (according to the FDA) in food and supplements; or whether it must be treated as a drug (and, therefore, go through clinical trials for lawful use).
It’s not like the FDA is unaware of the massive unregulated CBD market that already exists in the U.S. So, trying to shoehorn CBD into the “drug” category of FDA regulation may be difficult. For now, according to this WSJ interview, “the agency is focusing enforcement efforts on products that pose an immediate public-health risk, such as candies that could be accidentally eaten by children, or products meant to be consumed by food-producing animals.”
Ultimately, whatever the FDA finally decides on the regulatory or legislative recommendation front, a bomb will drop in the existing CBD industry.
If the FDA decides to regulate CBD for foods and supplements, we can expect a painful transition in the CBD realm where companies may either: 1) exist in a state of conflict between current state laws and FDA regulation or 2) come into compliance with FDA regulation. Option 2 would likely be hugely expensive: we would see increased business failure as well as market consolidation.
Alternatively, the FDA may determine that CBD cannot be safely consumed in food and supplements. However, any kind of FDA regulation will undoubtedly open the floodgates for business investment, including even larger players (food or pharma companies, for example) coming into the space to try to generate some market share. It’s really anyone’s guess about what lies ahead. So, stay tuned!
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Kentucky Gov. Andy Beshear recently held a press briefing detailing many of his successful actions from the past year. Among these accomplishments for his administration, Beshear discussed his move to help patients who want to use medical cannabis. “After the General Assembly failed to take action once again, I issued an executive order to allow certain Kentuckians, like veterans suffering from PTSD and those suffering from chronic and terminal conditions like cancer, to access medical cannabis. That order takes effect soon, Jan. 1, 2023,” he said.
After concluding the briefing, Beshear took questions from the press. Al Cross, a professor at the University of Kentucky School of Journalism and Media who also writes for the Northern Kentucky Tribune, asked about the lack of convenience for those seeking to obtain medical cannabis.
“The executive order isn’t going to make it convenient for anyone on the medical marijuana front. What it will ensure is that they’re not a criminal,” Beshear said. “And that’s the limitations that I have in executive power and the limitations that other states have set if we don’t have our own full program. And it’s why it’s so important that the legislature go ahead and pass medical marijuana.”
Beshear shared that his administration is working on putting together regulations for Delta-8 products, which was recently ruled legal by a Northern Kentucky circuit judge. He also explained that the legislature needs to do its part to assist patients throughout the state by passing an official medical cannabis program.
“I want our people to be able to get it close to home, I don’t want them to have to drive to Illinois. That takes an act of the legislature,” Beshear said. “I am the first to admit the executive order is imperfect because the legislature should have done this a long time ago, but it’s also fluent. And just by reissuing an additional executive order, we can shore up anything that we have the ability to, as we have those discussions with other states.
Beshear mentioned that soon there will be a “palm card” issued to law enforcement next week to educate them about what the executive order accomplishes. “Also the palm card for law enforcement will be out there by Jan. 4. First, it is very simple,” Beshear briefly explained. “But just talking to the Mothers for Medical Marijuana the other day, [the] executive order is a step they find exciting and provides some comfort that they won’t be prosecuted, but it’s not the answer. But I do hope it provides pressure.”
According to WHAS11, Beshear described the palm card as a checklist for law enforcement to work through, including showing a receipt that states where a product was purchased.
Recently, advocates from Kentucky Moms for Medical Cannabis and Kentucky NORML spent time in the Kentucky capitol building hanging more than 350 images of patients with chronic conditions who benefitted from access to medical cannabis. Beshear visited the exhibit on Dec. 28 to meet with those advocates. “Many Kentuckians with chronic pain are suffering and searching for relief. Today I visited with Moms for Cannabis, advocates who are looking for health solutions that don’t sacrifice quality of life—something medical cannabis can deliver,” Beshear wrote on Twitter.
Julie Cantwell from Kentucky Moms for Medical Cannabis is hoping that the legislature takes action in 2023. “Year after year, we’re overlooked, and this year we’re hoping that the legislature is going to pass a medical cannabis bill,” Cantwell told WYMT. “So, a lot of these people you see on the wall can’t make it to Frankfort, so we’re bringing the people to Frankfort.”
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Not only is CBD legal in France, but hemp flower as well, if the latest court ruling in the country stands.
French outlet RFI reports that On 30 December 2021, the French government legalized the sale of hemp-derived products containing CBD with 0.3 percent THC or less, after the country’s ban on CBD fell apart a year earlier. However—potentially to the dismay of D8 and hemp flower lovers—the government also banned the sale of hemp flower, citing its supposed psychotropic effects.
But a high court in France overturned that ban, ruling that CBD has not been proven to be harmful and that there are legitimate uses for flower that go beyond smoking.
On December 29, France’s Council of State, the body that advises the government on legislation and acts as a type of Supreme Court, ruled that a general and absolute ban on the marketing of the substance in its raw state was “disproportionate.” They also didn’t find solid evidence of harm from CBD. If anything, there’s evidence of the contrary.
“The harmfulness of other molecules present in cannabis flowers and leaves, in particular CBD, has not been established,” the council said. The council added that evidence suggests CBD has “relaxing properties and anticonvulsant effects, but does not have a psychotropic effect and does not cause dependence.”
In other words, the court ruled that hemp flower should not automatically be categorized as psychotropic—rather it’s far from it. Additionally, it can be consumed as a homemade tea or infused oil and not just smoked. Homemade tinctures or vaporized flower are other considerations.
Concerns Over Distinguishing Cannabis
Despite allowing flower with the latest court ruling, concerns were raised regarding exactly how the government plans on separating hemp from THC-rich cannabis, which are nearly indistinguishable to the naked eye. The Council of State considered that the THC level “could be controlled by means of rapid tests.”
The European Court of Justice ruled in November 2020 that the ban on CBD in France, which was legal in several other European countries, was illegal based on the principle of free movement of goods.
Then the highest court in the French judiciary, The Court of Cassation, ruled last June that any CBD legally produced in the European Union could legally be sold in France.
RFI reports that France is now home to around 2,000 CBD shops, according to the professional hemp association (SPC). In addition, the industry’s annual turnover is estimated at around €500 million, or $534.1 million USD. More than half of those sales are from flower alone.
Experts in the country say that the court’s latest ruling gives the green light for an “economically sustainable” hemp industry that can withstand the test of time.
Hemp Today reports that French hemp could bring €1.5 ($1.6B USD) to €2.5 billion ($2.6B USD) in annual turnover and result in 18,000-20,000 jobs, according to a French Senate group.
The French gray market for CBD was about €200 million ($214M USD) in 2021, and is expected to reach roughly €300 million ($321M USD) this year, UIVEC, a French extracts trade group, estimated. UIVEC also estimated that about 300-500 hectares of hemp were grown for CBD-producing flower in 2022.
The rules are expected to roll out in early 2023 as the legislation moves forward, and the government is expected to declare hemp compatible with the EU’s Common Agriculture Policy, develop a strategy for the industry, and set specific regulations.
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Here’s to a great 2023 for all of our readers, friends and clients! We hope your New Year is filled with lots of joy, laughter, and good cheer.
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The Oregon Health Authority (OHA) approved its final rules for the Oregon Psilocybin Services Act on Dec. 27. The Act was originally created through the passing of Ballot Measure 109 in November 2020, which was later codified into law as ORS 475A.
The OHA’s final rules were created through recommendations from the Oregon Psilocybin Advisory Board, the Rules Advisory Committee, and public comments. Initially the OHA released its first subset of rules in May 2022, and with the final rules now in place, Oregon Psilocybin Services (OPS) will begin accepting applications for four license types starting on Jan. 2, 2023.
According to a letter co-written by André Ourso, Administrator of the Center for Health Protection, and Angie Allbee, Section Manager for OPS:
“OPS received over 200 written comments and six hours of comments shared in the public hearings during the November 2022 public comment period,” wrote Ourso and Allbee. “These comments helped to further refine and improve the rules, which have now been adopted as final. The final rules are a starting place for the nation’s first regulatory framework for psilocybin services, and we will continue to evaluate and evolve this work as we move into the future.”
These new rules include an option for microdosing with the hope that it will “increase access, equity, and affordability while ensuring public safety.” “The final rules on duration of administrative sessions have been revised to create a new tier for subperceptual doses. These doses are defined as products containing less than 2.5 mg of psilocybin analyte. After a client’s initial session, the minimum duration for a subperceptual dose of 2.5 mg of psilocybin analyte or less is 30 minutes.”
The OPS also established rules to create translated materials in English, Spanish, along with interpretation materials to best serve a wide variety of potential patients. The agency also created numerous rules to address confidentiality of client data, improvements to the application form, and certain limitations for applicants if they have recently had thoughts about causing harm to themselves, or are pregnant or breastfeeding.
As for fees, the OPS will offer less expensive options to those who qualify, with the opportunity to consider making the service more affordable in the future. “The final rules include reduced license fees for applicants who are veterans, receiving social security income, receiving food stamp benefits, or are enrolled in the Oregon Health Plan,” the OPS letter states. “Creating a more complicated tiered license fee structure is not feasible due to the work required to identify appropriate tiers and evaluate license applications and supporting documentation. This work would require more staff capacity, which would result in higher license fees overall.”
With applications opening in less than a week, the OPS letter signs off with a hopeful statement. “OPS will strive to support applicants in navigating license application requirements and will continue to provide technical assistance as we launch the nation’s first regulatory and licensing framework for psilocybin services,” the letter concludes.
Meanwhile in cannabis, end-of-year analysis discuss the past year’s oversupply issues. The Oregon Office of Economic Analysis (OEA) released a forecast in December covering a wide variety of businesses in Oregon, including cannabis. “Now, this is great news for consumers who can enjoy widely available products at low prices,” OEA economists wrote about the cannabis industry. “This is bad news for firms trying to operate a profitable business. One challenge there is even as businesses do leave the market, to date there has always been another willing to step in and take their place.”
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