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Many twists and turns ahead for hemp industry in USA

As the euphoria brought on by passage of the U.S. Farm Bill begins to fade, American hemp stakeholders face the challenges of crafting and living with federal and state standards for cultivation and finished products. Some in the industry are eager to work with the U.S. Food & Drug Administration (FDA) to develop standards for hemp-based consumer products. Others threaten lawsuits.

Meanwhile, exponential growth, driven primarily by soaring demand for CBD, means many twists and turns ahead for hemp in the USA.

“In four years, we went from zero acres to almost 80,000 acres in hemp cultivation,” said Robert Hoban, managing partner of Colorado-based Hoban Law Group. “That’s pretty impressive for agriculture. The CBD industry is growing dramatically. I don’t expect to see it slow down. I don’t see the government putting the brakes on the industry at the federal level. But there are many challenges ahead…many.”

The 2018 Farm Bill essentially legalized hemp by removing it from the Controlled Substances Act and out of the purview of the U.S. Drug Enforcement Agency (DEA), expanding the definition of industrial hemp, and categorizing hemp as an agricultural product. Moving forward, the USDA plans to have federal cultivation standards for hemp in time for the 2020 growing season.

Meantime, states can develop their own standards that meet USDA minimums and submit those standards to the FDA, which must respond within 60 days, said Eric Steenstra, president of Vote Hemp, a lobbying group.

The 2018 farm bill also turns the clock back 30 years, in a good way, to when hemp was first being promoted as a super food, Hoban said.

“The door is cracked open for cannabinoid-enriched foods,” Hoban said. “We’re going to see more large-scale farms and more government policies and regulations. This is something that can and should exist.”

As the industry works to shape the regulatory framework for hemp, here are the critical considerations:

Who is the regulator?

Hoban’s firm believes the FDA is the logical regulator. He also cites the importance of a seat at the FDA’s table.

“We don’t have a choice,” Hoban said. “People complain that no one gave the regulatory authority to the FDA. The FDA already has authority over all products that go into human beings on a mass scale. Regulation is something that needs to be embraced by a new industry—not revolted against. If you embrace regulation, it becomes mainstream. We want these products to be available for people’s well-being.”

Instead of fighting the FDA, “We talk to the FDA every week,” Hoban said. “We’re intimately involved in crafting what the FDA is doing.”
The FDA does have the experience and the power to establish and enforce regulations, said hemp food veteran Richard Rose, a product developer and consultant. “They already are regulating it; it’s in their wheelhouse and they have fines and jail backing them up,” he said.

But the agency is not well-suited to set standards for CBD and hemp because of its “long demonization of cannabis and the fact that for medicinal products, they prefer a one- or two-molecule approach, which is directly contrary to the cannabis industry’s molecule approach,” Rose said. “The way the FDA views appropriate products and the way the industry views appropriate products are diametrically opposed. It’s two trains heading at each other and I don’t think the FDA will win this one. Science is not on their side.”

The FDA is qualified only to regulate the accuracy of labeling—whether a product contains the amount of CBD claimed on the label, said Rick Trojan, founder of Hemp Road Trip, vice president of the Hemp Industries Association (HIA) and director of Colorado HIA. Beyond that, the FDA is not the correct entity to develop and enforce standards, Trojan said.

“The FDA has no understanding of cannabis, is blind to the situation and can’t create regulations,” Trojan said. “Any FDA standards are going to be insufficient and inaccurate. While the FDA is the regulating authority for pharmaceuticals, it shouldn’t be the regulatory authority for cannabis.”

Slow pace of the FDA

Beyond the recent approval of Epidiolex as a treatment for children with epilepsy, it could take years before the FDA has regulations and classifications for other CBD products claiming therapeutic benefits.

“The FDA is very slow,” Steenstra said. “They’re going to look at this in a slow, methodical, scientific process. It’s going to be a long time before they finish.”

Some standards that have been put forward are inadequate. “U.S. Hemp Roundtable’s proposed standards are quite weak, basically just AHPA’s (American Herbal Products Association) but rushed to the market without sufficient vetting or industry input,” Rose said. “Everybody seems to have a set of standards. At the end of the day, it will be a marketing problem more than a technological one: who will the people believe?”

Legality of CBD

“There is no absence of standards,” Rose said. “The FDA already regulates (CBD) as a food or dietary supplement. The biggest problem is the perception there is a lack of regulations as well as the perception that CBD is not fully legal.”

“We’re facing a lot of challenges because the FDA has taken a position at the federal level that you can’t sell CBD as a dietary supplement,” Steenstra said.

New standards unnecessary

Consumable hemp should be regulated like other foods and supplements—no new standards are needed anyway.

“We’ve convinced the FDA they need to regulate these products like any other food or supplement,” Hoban said. “You don’t need to create new standards for industrial hemp.”

“The FDA has been regulating dietary supplements for some time,” Steenstra said. “Hemp fits in like any other herbal. Companies should be meeting FDA standards. We just want hemp to be treated like any other supplement. We don’t need to reinvent the wheel here.”

Lawsuit against FDA inevitable

“The reality is: we’re going to have to sue the FDA,” Trojan said. “HIA sued the DEA three times and won two times out of three. One of our members will take the lead and we’ll support it on the back end.”

Some states are moving ahead, Steenstra said, but many states are waiting for federal regulations. “The USDA told us a few weeks ago that they had already received three state plans and at least one tribal plan to regulate hemp,” he said. “Someone from another state (that he declined to name) told me that they weren’t waiting on the USDA 60-day approval process, he said.

“It’s an exciting time and an exciting opportunity. But states can’t sit back and wait for the federal government to solve their problems,” Hoban said. “States don’t understand that they can use their agencies that are the equivalent of the USDA to make sure products are standardized. The states need to take the lead. Colorado stepped up and did it.”

Ironically, many conservative states that normally don’t want federal government oversight are, in this case, waiting for federal-level answers, Hoban said.

Standardized seed testing

Agricultural testing of hemp needs to be standardized. “From a farming perspective, there are problems with testing the plant material,” Hoban said. “Do you homogenize the content over the entire plant or do you simply test the flowers?”

Moving forward, “There’s a lot of pent up excitement about hemp and people want to move forward,” Steenstra said. “You’re going to see lots of hemp grown this year.” – Karen Haywood Queen