CBD Market in Panic Mode After FDA Updates Stance

The FDA has sent a warning to 15 companies that they may be in violation of federal law, thanks to unfounded claims regarding CBD products.

The cannabis markets were rocked earlier this week, following news that the US Food and Drug Administration (FDA) had officially updated its stance on cannabidiol (CBD), warning consumers that the compound may potentially harm users.

The announcement sent shockwaves through the CBD industry, which has been in a state of rapid expansion for much of 2019, following the introduction of the US Farm Bill late last year. Since then, it has made its way into numerous consumer products, including shampoo, food, drink, cosmetics and supplements.  

In fact, the compound is growing so popular that a recent study conducted by BDS Analytics and Arcview Market Research to concluded that CBD sales could surpass $20 billion by 2024 in the US alone.

However, this could all change following the FDA's warning letter to 15 companies that sell CBD products, notifying them that they are in violation of federal law.

The following companies were named as part of the FDA's regulatory blitz:

  • Koi CBD LLC
  • Pink Collections Inc
  • Noli Oil
  • Natural Native LLC
  • Whole Leaf Organics LLC
  • Infinite Product Company LLLP
  • Apex Hemp Oil LLC
  • Bella Rose Labs
  • Sunflora Inc
  • Healthy Hemp Strategies LLC
  • Private I Salon LLC
  • Organix Industries Inc
  • Red Pill Medical Inc
  • Sabai Ventures Ltd
  • Daddy Burt LLC

The FDA's principal deputy commissioner, Dr. Amy Abernethy, stated that the agency's experts "remain concerned that some people wrongly think that the myriad of CBD products on the market, many of which are illegal, have been evaluated by the FDA and determined to be safe, or that trying CBD 'can't hurt."

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"As we work quickly to further clarify our regulatory approach for products containing cannabis and cannabis-derived compounds like CBD, we'll continue to monitor the marketplace and take action as needed against companies that violate the law in ways that raise a variety of public health concerns," she said.

According to the FDA, these companies have broken the law by marketing a series of unproven health benefits for a number of CBD products, including food and dietary supplements.

As part of the FDA's crackdown, the agency also issued an update to consumers about its stance on CBD products, arguing that the evidence of their safety is still limited.

Although this may sound like dire news, it is important to remember that the FDA is not saying that these products are dangerous, but rather that the agency does not have enough evidence to definitely claim that CBD can be "generally recognized as safe", at this time.

Another concern that's been raised is the potential damage that the compound could cause if consumed by demographics such as pregnant women and children.

Under the auspices of the FDA, CBD will continue to be treated as a "drug", which means it will be subject to the same rules and regulations as other pharmaceutical products, stated deputy commissioner Amy Abernethy.

"This overarching approach regarding CBD is the same as the FDA would take for any other substance that we regulate," Abernethy said.

The FDA has demanded that the 15 companies named in the letter respond within a fortnight, with a report on how they plan to address the violations.

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Hugo Gray
Hugo Gray

Hugo Gray is a Melbourne-based journalist with a body of work that covers a diverse range of topics, including immigration law, sex technology, and now the rapidly expanding cannabis industry.

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