New Legislation Seeks to Open CBD Food and Beverage Market

The journey towards federal regulation for the legal use of CBD in food and beverage products took another step forward today with the introduction of the Hemp Access and Consumer Safety Act in the U.S. Congress.

What is the bill?

Filed by Sens. Ron Wyden (D-OR), Rand Paul (R-KY) and Jeff Merkley (D-OR), the Act calls for “hemp, hemp-derived cannabinoid, or substance containing any other ingredient derived from hemp” to be exempted from established prohibitions currently on the books.

The act also allows for the Secretary of Health and Human Services to “establish labeling and packaging requirements for dietary supplements and food that contain hemp” or CBD, as well as “take additional enforcement actions with respect to products labeled as dietary supplements but not meeting the definition of such term” in the federal code.

“CBD products are legally being used and produced across the nation. Yet because the FDA has failed to update its regulations, consumers and producers remain in a regulatory gray zone,” Wyden said in a press release. “It’s been more than two years since I worked with colleagues to have Congress legalize hemp and hemp-derived products. It’s long past time for the FDA to get with the program, for the sake of American consumers and farmers.”

In his comments, Merkley decried the plight of American hemp farmers being “left guessing about how their product will be regulated” and the lost opportunities for “real economic gains” in the wake of dithering by the FDA.

“Hemp-derived CBD products are already widely available, and we all need [the] FDA to issue clear regulations for them just like they do for other foods, drinks, and dietary supplements.”

Who Would it Help?

For those growers, brands and entrepreneurs working in the hemp CPG industry, the Hemp Access and Consumer Safety Act should come as welcome news. As has been well chronicled on both BevNET and NOSH, despite hemp being legalized in 2018, the nascent CBD food and beverage industry has been hampered by a lack of federal regulation on the cannabinoid’s use as an ingredient. While sales for CBD products are projected to reach $16.8 billion in sales by 2025, according to Brightfield Group, many major retailers and distributors remain hesitant to build out hemp-based product sets without clarity on the federal government’s position. As a result, brands like Weller, Cloud Water, Beam, Recess and others have sought to diversify their portfolios outside of CBD in the meantime.

The main hangup here has been the Food, Drug, and Cosmetics Act, which prevents any new dietary ingredient, food, or beverage from entering the market if it has been previously studied or approved as a drug. By granting an exception for hemp-derived CBD, the FDA would be able to regulate it just like any other ingredient.

“Recess supports a single, reasonable and enforceable federal regulatory framework that protects consumers from bad actors and enables responsible manufacturers to lawfully market products in a manner that is guided by science,” said Ben Witte, CEO and founder of Recess, in a statement. “Given that nearly twenty states have regulatory frameworks over the use of ingestible CBD in consumer products, a consistent federal framework is long overdue and Recess looks forward to working productively with legislators and the Food and Drug Administration to establish clear rules of the road for food and beverage products.”

The legislation has also received support from a variety of industry groups, including the U.S. Hemp Roundtable, the American Herbal Products Association, the Consumer Brands Association and Wine and Spirits Wholesalers of America, National Industrial Hemp Council and the Kentucky Guild of Brewers.

Jonathan Miller, General Counsel for the U.S. Hemp Roundtable, called the Hemp Access and Consumer Safety Act “a huge win for American consumers, farmers, and the hemp industry as a whole.”

“Consumers will benefit from knowing that CBD products must be manufactured according to FDA-approved CBD processes,” he said. “Struggling American farmers will benefit from a stabilized marketplace. It also will stimulate innovation and job creation in the hemp industry. The U.S. Hemp Roundtable is deeply grateful to Senator Ron Wyden for crafting this smart, sensible, and critical legislation, and to Senator Rand Paul and Senator Jeff Merkley for serving as the original co-sponsors.”

In January, the U.S. Department of Agriculture (USDA) released its final rule on hemp production, which went into effect on March 22.

Meanwhile, in the U.S. House of Representatives, Reps. Kurt Schrader (D-OR) and Morgan Griffith (R-VA) reintroduced a similar bill, called the Hemp and Hemp-Derived CBD Consumer Protection and Market Stabilization Act, in February. This is the bill’s second filing; it was introduced originally in September 2020 but died before receiving a vote.