The cannabidiol (CBD) market has been experiencing rapid growth over the years, thanks to its rise as a wellness product.
Since the Farm Bill was passed in 2018, the hemp-derived CBD industry has experienced a growth spurt. The market has shifted away from its perception of marijuana as a psychoactive drug.
CBD is believed to be an anxiety reliever, an anti-inflammatory compound and as a beauty product. The “miracle” hemp extract has made its way into retail stores, pharmaceuticals and food, and beverage stores.
Since its legalization in Canada and purchasing and consumption approval in about 33 states in the US, entrepreneurs have seen an opportunity to tap into this new niche market. They are doing so through investing in companies and working on innovations to make CBD-based products accessible and appealing to consumers.
For instance, the company Elixiniol has been in the CBD market since 1991 and has made major strides towards providing the quality consumer products, through its industrial organic hemp-derived CBD oils and pet treats.
Companies have also been increasing their investments in CBD to keep up with the rising market demand. For example, Canopy Growth, a CBD company based in Canada is looking to expand its operations in the US by investing in an extraction and processing plant.
CBD has been infused with beverages, snacks, bath bombs, and pet treats. Its wide acceptance has ramped up sales with research showing that more than 64 million people in the US, have used CBD.
Despite its exponential growth, the cannabis and CBD market has faced some regulatory stumbling block, seemingly operating in a gray area.
CBD and FDA Regulation
With the lack of clear guidelines and regulations amid the popularity and acceptance of CBD, companies are taking risks to make it big through their assortments of CBD products. The CBD market is set to grow to about $2.7 billion by 2022.
This has led consumers, manufacturers, and in essence, the CBD industry as a whole to seek FDA intervention in setting regulations for its use. Drug additives and supplements entering the market need to be approved as safe by the FDA. According to the Federal Food, Drug and Cosmetics Act, CBD and THC are classified as drugs. The FDA reserves the right to issue exceptions in this Act and this is what the CBD industry is hoping for.
CBD manufacturers and consumers are lobbying for quick approval of CBD products, with the majority asking for the FDA to issue guidelines on the dosage and labeling for CBD.
To facilitate this, the FDA held its first hearing on CBD safety and its benefits. The FDA hearings covered the cannabis industry as a whole, with concerns r8anging from dosage for CBD, its usage, its effects on pregnant women to its prolonged use effects and interaction with other drugs.
The regulator insisted for more scientifically proven data on the perceived benefits of CBD to be presented.
Although the FDA does not currently approve CBD as a supplement, the industry growth is unquestionable. The CBD has disrupted the food and beverage market with its edible market, which is expected to top $4.1 billion by 2022.
Cannabis industry stocks tanked during the Friday hearing as the market adopted a wait-and-see attitude for the fate of this surging market.
Key players calling for action
The FDA hearing was attended by major industry players, with about 100 people giving their testimonies on CBD use.
Elixinol, one of the top companies in CBD known for the production and manufacturing of high-quality hemp product is a key player in the US hemp market. The company continually strives to be better as seen through its latest product Respira hemp oil.
During the hearing, Elixinol was represented by its regulatory officer Dr. Philip Blair who addressed the health concerns related to CBD use. Dr. Blair reiterated that CBD is beneficial to health and in over five years, there have never been reports of adverse side effects.
Other hearing attendees, like Megan Olsen of the Council for Responsible Nutrition, told the panelists, that the existing regulatory framework for dietary supplements could be applied to CBD. The only drug containing CBD that has been approved by the FDA is the epilepsy treatment drug Epidiolex.
Elixinol spokesperson Chris Husong expressed that clear guidelines will ensure the quality of the products. With clearly defined FDA regulations, legal market players with quality products will continue performing better while eliminating the black market companies with unverified products.
Advocates for CBD represented by the general counsel Jonathan Miller are also pressing the FDA to come up with guidelines to regulate the industry to improve quality of CBD products, their safety and promote transparency in the industry.