On May 19, 2021, Senators Rand Paul (R-KY), Ron Wyden (D-OR), and Jeff Merkley (D-OR) introduced the Hemp Access and Consumer Safety Act of 2021 (SB 1698), which would address long-standing regulatory uncertainty facing products that contain hemp-derived cannabidiol (CBD) by authorizing use of CBD in dietary supplements and food. Specifically, the Act would amend the Federal Food, Drug and Cosmetic Act (FFDCA) so that “hemp, hemp-derived cannabidiol, or a substance containing any other ingredient derived from hemp” are no longer prohibited as dietary supplements or food additives. The Act would still require manufacturers to comply with all existing federal regulations for products that contain CBD and ensure that these products are properly labeled.

Despite the ubiquity of CBD products on the market, the Food and Drug Administration (FDA) continues to maintain that products containing CBD cannot be sold as dietary supplements, foods, and/or beverages under the FFDCA.  Dietary supplements are products taken by mouth that contain a “dietary ingredient,” such as vitamins, minerals, or botanicals, intended to supplement the diet. FDA’s position relies on the fact that CBD is already an approved drug product active ingredient, which makes it ineligible for dietary supplement or food additive status under the FFDCA, unless exempted by FDA. To date, FDA has approved one cannabis-derived and three cannabis-related drug products, but refused to issue an exemption to allow use of CBD in dietary supplements or food. 

Passage of the Hemp Access and Consumer Safety Act of 2021 could help provide much-needed clarity to the CBD market, which has been subject to a number of FDA enforcement actions in recent years. FDA has sent warning letters to companies selling CBD products marketed as dietary supplements, including CBD drops, CBD gummies and vapes, and water and sprays. Similarly, companies selling food products, such as lollipops and teas, with CBD as an added ingredient, have received warning letters from FDA deeming these products adulterated within the meaning of section 402(a)(2)(C)(i) of the FFDCA.

The global CBD market is currently valued at somewhere between 1 and 2 billion USD with current projections for 2025 between 5 and 20 billion USD. While projections for how much this market will increase over the next decade vary, most agree that there will be substantial growth in the years to come.

Beveridge & Diamond's Industrial Hemp & Cannabis industry group assists cannabis-based businesses with state-level environmental compliance, product liability, project planning, environmental risk avoidance, and, when appropriate, litigation and defense against state-level environmental enforcement actions. Click here to sign up for our Industrial Hemp & Cannabis industry list to receive topical news alerts and event invitations by email. Possession, use, distribution, and sale of cannabis may be a federal crime. These materials, and any advice provided herein, are not intended to provide any guidance or assistance in violating federal law, or in providing guidance or assistance in complying with federal law.