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Cannabis-based product rules continue to vary

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Shannon Cox

There is a growing public focus on the potential for legitimate pharmacological uses of cannabis. Much of this focus has been directed toward medical marijuana — the use of marijuana in plant form or its basic extracts. Although some states have legalized its use, the Food and Drug Administration has not approved marijuana in plant form as a safe and effective drug for any medical indication, and marijuana in plant and direct extract form continues to be listed as a Schedule I controlled substance under federal law, along with drugs like cocaine and heroin. However, in addition to medical marijuana, there is significant interest in the potential use of various cannabis-derived chemical compounds, including tetrahydrocannabinol (THC) and cannabidiol (CBD), to treat a wide range of medical conditions ranging from pain to seizures, nausea, depression, anxiety, inflammation, muscle spasticity, digestive disorders and insomnia. This article will examine several recent federal regulatory and legislative actions relating to the development of cannabis-based drug products.

Federal regulation

Under the Federal Food, Drug and Cosmetic Act, any product that is marketed with a claim of therapeutic benefit must be approved by the FDA before it can be sold legally. The FDA’s drug approval process evaluates whether proposed drug products are safe and effective for their intended indications. Many cannabis-based products are also subject to the jurisdiction of the federal Drug Enforcement Administration. The classification of marijuana as a Schedule I controlled substance under the federal Controlled Substances Act (CSA) presents additional challenges to the development of cannabis-based prescription drug ­products.

Because of marijuana’s status as a Schedule I controlled substance, it is generally illegal to grow, manufacture, distribute, dispense or possess products derived from marijuana. In order to legally conduct the research required to achieve FDA approval, a researcher must be registered with the DEA and must obtain the marijuana-derived products used in the testing from a DEA-registered source.

Under this regulatory scheme, prior to 2018 there were only three approved cannabinoid prescription drug products — all of which are synthetic compounds rather than compounds derived from the cannabis plant. Marinol and Syndros contain synthetic versions of THC, while Cesamet is a synthetic THC analogue. These three drugs have been approved for the treatment of nausea and vomiting associated with cancer chemotherapy and the treatment of anorexia associated with weight loss in patients with AIDS, and they are designated as Schedule II and III controlled substances.

Approval of Epidiolex

Stephen Cummings

In June 2018, the FDA approved Epidiolex, a CBD oral solution for the treatment of seizures associated with two rare and severe forms of epilepsy. Following FDA approval, the DEA scheduled Epidiolex as a Schedule V controlled substance. This move did not impact the status of other CBD products because the DEA’s scheduling order was very narrow. It placed in Schedule V only “FDA-approved drugs that contain CBD derived from cannabis and no more than 0.1% [THC].”

2018 Farm Bill

The Agriculture Improvement Act of 2018 (2018 Farm Bill), which was signed into law in late December 2018, addressed the production and marketing of hemp by removing hemp from the definition of marijuana under the CSA. As a result, there are now essentially two types of cannabis under federal law: hemp, which is cannabis with no more than 0.3% THC on a dry weight basis, and marijuana, which is cannabis with a THC concentration greater than 0.3%. While hemp is not a controlled substance, marijuana remains on Schedule I. Accordingly, the CSA no longer provides a legal hurdle to the marketing of CBD products — so long as the CBD is derived from hemp, not marijuana.

FDA framework

In April 2019, FDA reaffirmed its authority to regulate cannabis-based products by stating that it was taking “four key” steps to protect the public while it evaluates a potential framework to regulate non-drug cannabis-based products.

The first key step was a public hearing held on May 31. The public hearing allowed relevant stakeholders the opportunity to provide input to the FDA about the safety, manufacturing, product quality, marketing, labeling and sale of cannabis-based products. The public meeting facilitated the sharing of information that is currently available and identified several open questions, including how much CBD is safe to consume, the risks that are associated with adverse drug interactions, the potential impact of CBD and other cannabis use on special populations, and the risks associated with long-term ­exposure.

The second key step in the FDA’s ongoing review was the creation of a high-level agency working group. The working group is tasked with reviewing the information shared at the public hearing and considering the public comments coming out of the meeting. The working group will also address the open questions that were identified in the public meeting.

The FDA’s third key step is communicating with the various stakeholders that are interested in the development of cannabis-based products. To facilitate this communication, the FDA has a dedicated web page, atfda.gov/news-events/public-health-focus/fda-regulation-cannabis-and-cannabis-derived-products-questions-and-answers, which provides updates on the agency’s ­ongoing review of cannabis-based products, including frequently asked questions and answers.

The fourth key step is the FDA’s use of its enforcement authority against companies that are marketing cannabis-based products with deceptive or unsupported claims. Trends in enforcement actions should be closely monitored as more cannabis-based products are introduced to the marketplace, especially since the FDA has already expressed concerns that some companies are making egregious marketing claims that cannabis-based products can prevent or treat a wide range of health ailments.

DEA Activity

As part of the application process to obtain a DEA registration to conduct research on Schedule I controlled substances, researchers are required to provide information about their qualifications, submit their research protocols and identify the institution where the research will take place.

In January, the DEA announced a plan to streamline the application process by allowing researchers to submit their application materials online through a dedicated web portal. However, even with this new process in place, once an application is complete, the time required for review and approval currently averages more than three months.

As a result of the increasing focus on the potential uses of cannabis-derived compounds, the DEA increased the amount of raw material available to researchers in 2019 by more than doubling the Annual Production Quota for marijuana.


Because of the evolving regulatory landscape relating to cannabis-derived drug products, it is important that all stakeholders, including manufacturers, distributors and retailers, continue to closely monitor developments at the federal level. In addition, stakeholders should also continue to monitor developments at the state level, since more and more states have either passed or are considering laws that will regulate cannabis-based products.

Shannon Cox and Stephen Cummings are counsels at King & Spalding’s Atlanta office. They can be contacted at [email protected] and [email protected].


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