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What's Holding Back The CBD Industry From Becoming Mainstream?

August 21, 2019
Industry

There is no doubt that the CBD industry is booming. By the end of the year 2022, this industry is forecast to reach $20 billion in sales on a relatively conservative note. The CBD market offers a wide range of products, from oils to skincare products. A lot of scientific studies are being conducted to support the endless promising potentials that CBD offers.

Economists say that the CBD market can be found where three consumer trends meet, these trends have influenced the CBD market to where it is now: the flourishing of herbal supplements, anxiety consumerism, and legalization of marijuana.

The Food and Drug Administration or FDA is an agency that protects consumers and is in charge of the supervision of manufacturing and handling of food and food additives, medicine, medical equipment, tobacco, and other consumer products.

The risks: the absence of solid regulation and legal ambiguities

In the United States, the legislation of the Hemp Farming Act of 2018 paved way to the reclassification of hemp and legalizing it as an agricultural commodity. Food ingredients derived from hemp seed such as hemp seed oil, hemp seeds and protein were analyzed by the FDA and were certified as a Generally Recognized as Safe or GRAS status and these products have since been removed from the Controlled Substances Act (CSA) by the end of 2018.

In May of this year, FDA held a public hearing to review the regulatory framework of CBD and its usage. Will it be a food-grade product or a dietary supplement? The answer is not clear as the FDA is yet to come out with a clear and solid regulation for the CBD market. The absence of this regulatory framework caused confusion in the legality of CBD products and a consequential challenge to both consumers and manufacturers.

Even though a lot of retailers and manufacturers move towards the CBD market, large companies are still frantic in putting CBD products on their shelves because they do not want to be penalized by the FDA.

What is the reason behind the delay in the regulations?

The FDA has not yet approved of the utilization of CBD on products to be used for medical treatments and applications because of the lack of enough and well-controlled clinical trials that will provide proof its safety and effectivity. The FDA believes that the best path to take is to complete drug approval processes. Any product that is produced for medical and therapeutic use must undergo the New Drug Application (NDA) process and the New Animal Drug Application (NADA) process for animal use.

An additional concern is that there are manufacturing companies that do not follow good manufacturing practices during production. Some market the product to contain a specific amount of CBD when it actually contains less. There are also companies who sell CBD that does not list all the compounds in the label such as THC.

The agency has been monitoring the marketplace and has since issued warning letters to firms that are selling CBD products that are marketed for therapeutic uses and false claims. The FDA acknowledges the potential medical and therapeutic uses of CBD however, they believe that it is important that CBD and its products undergo the NDA process to make sure that it will be safe for consumption.

What is being done to clarify the situation?

The FDA is currently reviewing the regulatory frameworks to be applied to CBD products that will be used for non-drug uses or those that are not intended for medical purposes such as food products and dietary supplements. 

In July, the FDA even asked the public about manufacturing, product quality, safety, labeling, marketing, and selling of CBD products to help with completing this framework. This continuous effort to gather data and complete systematic investigations are being done to make sure that the regulatory is unbiased and is placed for the good of public health.

What good can the regulatory framework do to the industry?

Preparing preliminary versions and implementing a new regulation could take a long time, the FDA promised to expedite their review. With a clear and solid regulatory framework in the CBD industry, it would be easier to filter the good companies from the bad. It could potentially open the doors to acceptance of hemp on countries around the world. So, it can be said that it is the FDA that is holding back the CBD industry in becoming mainstream but at the same time, it is for certain that once this is overcome, it can also help the industry to continuously strive.

 


Eileen Reyes, Content Manager

Eileen writes with the motivation of making this world a better place, and has a passion for the hemp industry. She's spent 5+ years as a content creator who loves to paint and travel. If she is not at her desk writing, she can be found playing with her dog, Beebop.

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