Home General CBD Industry Sees a Win and a Setback in the First Month of 2021

CBD Industry Sees a Win and a Setback in the First Month of 2021

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Whether you love them or hate them, CBD-derived products are here to stay. The industry has grown rapidly ever since legalization in 2018, and regulations have struggled to keep up. Even now, more than two years later, pharmaceutical companies are still waiting on the FDA to outline the rules for manufacturing and selling CBD-derived drug products. 

Even with delays like this, the news isn’t all bad. The pharmaceutical industry might be frustrated, but hemp farmers are more than happy about the USDA’s recently published regulations. Even with all the research that went into their interim rules, one requirement in particular was putting the farmers’ cost per acre through the roof. The new rules took this issue into consideration, though, and hemp farmers are celebrating the news.

USDA establishes new rules for hemp farmers

Since hemp can turn into an illegal substance by a simple twist of genetics, it’s regulated – or will be eventually – every step of the way. Since 2019, hemp growers have operated under the USDA’s interim rules, and have paid plenty of money to comply with the regulations. By far the most unpopular requirement was that growers had to utilise the services of DEA agents or law enforcement personnel to take away and destroy any hemp plants exceeding the 0.3% THC limit. Since this puts the plants into Schedule 1 substance territory, the USDA thought it was necessary for trained law enforcement personnel to handle the plants. Unfortunately, this was costing hemp growers an extra $200 an acre, and when the USDA gave them a chance to add their feedback for the new rules, this was near the top of the list. 

As a result, the new regulations allow growers to destroy the plants themselves, reducing the cost for each acre to just over $14. The main conditions are that they file records of what they destroy with the state (which the state will then file with the federal government), and that they have to use methods that will render the plants unusable and unsellable. Some of the approved methods are:

  • Plowing, disking, or tilling high-THC plants into the ground
  • Bush-mowing, chopping, composting, or mulching the plants for fertiliser
  • Burning
  • Burying the plants with soil

Strangely enough, the new rules don’t apply to hemp growers that are DEA-licensed – just to growers that are licensed through a state, territory, or tribe. 

The methods above have been used in agriculture for centuries to get rid of undesirable plant material, and hemp growers already use them for plants that have been damaged by disease, pests, or bad weather. With these plants, of course, there’s no need to ensure that the plant is completely destroyed; all in all, it definitely gives growers a lot more control over their crop.

The FDA withdraws a long-anticipated policy for CBD drug manufacturers and retailers

With regulations being drawn up from scratch to cover every aspect of the CBD industry, sometimes people will have to wait a while. This is definitely what’s happening with the FDA’s Cannabidiol Enforcement Policy Draft Guidance for Industry. To start with, the FDA spent over a year reviewing cannabinoids, including CBD. Then it was time to write a draft of the regulations and get it approved. For that, they submitted the document to the White House Office of Management and Budget, or OMB, which is responsible for reviewing the proposed regulations from all federal agencies. Not only do they review policies, but they do it to make sure that these policies comply with what the current president would want. 

The document may not have gotten approved, but the OMB was clearly reviewing it at some point; they met with companies that are part of the CBD industry, including the retailer GNC, and GW Pharmaceuticals. 

The FDA’s CBD enforcement policy waited for approval for half a year, but ended up having to withdraw it once Biden became president. This wasn’t a voluntary decision, but part of a routine spring-cleaning of sorts; the new administration instructed every federal agency to withdraw any of their rules that were still pending. Thanks to this unfortunate timing, the FDA will have to change their policy to reflect the new president’s goals, and then it’s back to the OMB for approval. Popular CBD brands like Koi CBD are hoping that the FDA won’t take too long to get the ball rolling again, but the FDA has stated that there’s currently no timeline for a new proposal. As there’s no legal deadline either, it could be a good long while. 

Retailers and manufacturers want these regulations to happen, and so does pretty much everyone involved in making or selling dietary supplements. The regulations in question won’t apply to supplements, but they’ll definitely inform supplement-related policies when they’re finally made. 

With CBD being a relatively new industry, there’s still a lot of work to be done to fill in regulatory gaps. A lot of business is being done in legal gray areas, sometimes without sufficient research. However, as time goes on the gaps will be filled, longer-term research will be completed, and both the industry and consumers will feel more confident about the many uses of CBD. 

Elena Deeley did her degree in psychology at the University of Edinburgh. She has an ongoing interest in mental health and well-being.

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