Regulators’ concerns over the unfettered sale of CBD have burst into the open with the US Food and Drug Administration (FDA) issuing an interim warning on the potential harmful effects of CBD.
At the same time, the FDA announced it had sent warning letters (again) to a further 15 companies, stating that they should not be making medical claims on the health benefits of CBD and gave them 15 working days to deal with the issue.
The FDA announcements sent shivers through the markets hitting the share prices of companies invested in the CBD space. Whilst it says it is still seeking to answer questions about the ‘science, safety, and quality of products containing CBD’ it pulled no punches.
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In what it described as a ‘Consumer Update’ it says: “The FDA is concerned that people may mistakenly believe that trying CBD can’t hurt. The agency wants to be clear that we have seen only limited data about CBD’s safety and these data point to real risks that need to be considered.”
The statement goes on to say that as far as the FDA is concerned there is only one CBD product – Epidiolex – which has been approved as a prescription drug for two types of childhood epilepsy. It also acknowledges that Epidiolex may present ‘certain safety risks including the potential for liver injury’.
Also highlighted are two other areas of concern, namely; drug interactions and male reproductive toxicity – they referred to scientific studies in both cases. The statement posed a number of unanswered questions saying it doesn’t know, the impact of ‘sustained’ CBD use and CBD’s impact on ‘developing brains’.
CBD Stocks Plummet
In its separate release, the FDA says it has issued warning letters to 15 companies for illegally selling products containing cannabidiol (CBD) in ways that violate the Federal Food, Drug, and Cosmetic Act.
The companies can be found here and are spread right across the country from California to Oregon, New York and Texas. It went on to say some of the products outlined in the warning raise other legal and public health concerns, highlighting that CBD is being added to ‘food’, ‘animal feed’ and marketed for ‘infants and children’.
The announcement rocked the already unsteady stock prices of many of the leading market players with Aurora down over 5% and Tilray over 3%. Consumer CBD stocks fell on the news, with CV Sciences down by 13% and Charlotte’s Web Holdings by over 6%.
BNN Bloomberg reports Peter Horvath, CEO of Green Growth Brands as saying the announcement could cause the chains to either ‘cut back or discontinue their CBD businesses’.
UK: CBD ‘Well-Tolerated”
Jefferies analyst Owen Bennett said forecasts on CBD’s sales are ‘likely to be slashed’. A similar exercise in into the efficacy of CBD industry is underway in the U.K. on behalf of the Food Standards Agency.
Earlier this year the Committee on Toxicity of Chemicals in Food highlighted similar potential medical issues but also said: “CBD is generally well-tolerated with a good safety profile. Reported adverse effects may be as a result of drug-drug interactions between CBD and patients’ existing medications.”
While the FDA has yet to unveil its formal guidelines for the CBD industry this does not bode well. It recently said it has received over 4,500 comments since it began its review of regulations for hemp-derived cannabidiol.
And, it says the main reason for its inability to reach a definitive position on the status of retail CBD is a ‘lack of scientific data’, reports the Hemp Industry Daily website.
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