Earlier this week, several major news outlets (CNN, Fox Business, and Bloomberg) reported that Coca-Cola is considering making a move into “cannabis drinks” — as evidenced by supposed talks with Aurora Cannabis, Inc., a Canadian owned and operated company that sells a variety of cannabis products including several strains of dried cannabis as well as several oils. The company finally issued a statement, in response to many media inquiries: “We have no interest in marijuana or cannabis. Along with many others in the beverage industry, we are closely watching the growth of non-psychoactive CBD as an ingredient in functional wellness beverages around the world. The space is evolving quickly. No decisions have been made at this time.”

Caution might well be warranted with respect to products for sale in the United States, because of the often-overlooked drug exclusion rule at FDA. Coca-Cola has sophisticated FDA counsel, and I am sure they are on top of this issue. But others watching legal and real-world developments relating to sale of cannabis may not be aware of the rule, which presents a significant legal impediment to the sale of CBD in any form other than approved new drugs (even if no medical claims are made).

Many people don’t know about the drug exclusion rule . . .

A Quick Background on Terminology

Cannabis is the plant (the genus is Cannabis and the family is Cannabaceae). There is a taxonomical debate relating to whether there are multiple species or instead one species with several strains, which doesn’t matter here. Generally speaking, within the plant there are three broad classes of substances that may produce health benefits: cannabinoids, terpenoids, and flavonoids. Cannabinoids include tetrahydrocannabinols (“THC”) as well as cannabidiol (“CBD”), but in fact cannabis plants may express more than 100 cannabinoids. Notice that I wrote tetrahydrocannabinols (plural); there are more than one THC. They are similar but not identical.

What is the drug exclusion rule?

Section 301(ll) of the FDCA provides that once a substance is the active ingredient of an approved new drug — or the active ingredient of a new drug in clinical trials that have been made public — a food containing that substance cannot be shipped in interstate commerce. And of course beverages are food.

And why is this a problem?

FDA has already approved new drugs containing (synthetic) THC and naturally derived cannabidiol. In May 1985, it approved Marinol for the treatment of nausea and vomiting associated with cancer chemotherapy in patients who have failed to respond adequately to conventional anti-emetic treatment. Marinol capsules contain synthetic delta-9-THC, which was assigned the nonproprietary (generic) name “dronabinol.” Marinol is now also approved for the treatment of anorexia associated with weight loss in patients with AIDS. (Here’s the latest package insert.) At the end of 1985, FDA approved Cesamet, similarly for treatment of nausea and vomiting associated with cancer chemotherapy. The active ingredient, nabilone, is a synthetic cannabinoid similar in structure to delta-9-THC. (Package insert here.)

And this past June the agency approved a new drug application for Epidiolex for the treatment of seizures associated with Lennox-Gastaut syndrome and Dravet syndrome in patients 2 years of age and older. (Package insert here.) This was FDA’s first approval of a new drug derived directly from the cannabis plant. The active ingredient is cannabidiol (CBD), another one of the many cannabinoids in the plant.

This is the cannabinoid mentioned in the Coca-Cola stories above. And the drug exclusion rule means that no foods containing CBD may be shipped in interstate commerce. This has nothing to do with whether the company makes medical claims about the product. It’s a flat ban — no foods containing CBD, period.

Are there any exceptions?

Yes, there is an exception, but I am not sure how promising it is. There is an exception for a substance marketed in food before the drug in question was approved or the trials started. But FDA requires that the substance be overtly marketed in the food, for instance with references in the label. And I think it would refuse to consider marketing in violation of federal law, such as the Controlled Substances Act. In any case, the FDA has already concluded that “THC” and CBD must be excluded from foods in interstate commerce. (Consider Q13 and Q14, here.) That said, it has invited evidence and arguments to the contrary. In addition, its claim about THC may be overbroad. Dronabinol contains synthetic delta-9-THC, but cannabis also contains several variants of delta-8-THC. These are also referred to as “THC” but may not be barred by the drug exclusion.

But, my neighbor-friend-mom-wife buys CBD oil at her local health food store (or off the Internet)! This cannot be right.

Yes, I know. It’s widely available, and some companies ship it all over the country. These products are generally positioned as dietary supplements, not conventional food. But these products are marketed illegally. There is a drug exclusion rule for dietary supplements as well, in section 201(ff) of the FDCA. And FDA similarly takes the position that this exclusion means “THC” and CBD cannot be added to dietary supplements. It has sent numerous Warning Letters to companies marketing cannabidiol in supposed dietary supplements, citing the drug exclusion rule (here). The agency issues a Warning Letter for “significant violations” of the FDCA (see page 3, here), and it signals that there may be enforcement action if the company does not voluntarily bring itself into compliance.

Is there any path forward for foods, then?

Sure; it’s important to understand the scope and reach of the drug exclusion.

First, it precludes only the specific active ingredients already present in new drugs. A company can avoid the drug exclusion by adding a different cannabinoid (or terpenoid or flavonoid) from cannabis — rather than dronabinol or CBD — to its food. Right now, there’s an additional problem, of course, which is that both “marihuana” and “THC” are schedule I drugs under the Controlled Substances Act. But if they are descheduled, a food company that wants to use a different cannabis constituent in its food should do so as soon as possible — overtly —calling out the precise cannabinoid in the food label. As soon as one of these other cannabinoids is the subject of a publicly known clinical trial, it will be too late to add it to a food.

Second, section 301(ll) prohibits the interstate shipment of a food after addition of a new drug. It may be possible to avoid the drug exclusion by manufacturing and selling conventional food products with dronabinol or CBD purely within the confines of a single state. It is not clear to me that FDA could take action under section 301(ll) with respect to a food made with dronabinol or CBD and sold within the same state, even if it contained a component (which is also a “food”) — such as flour — that had been shipped in interstate commerce.

Want more? Sean O’Connor and I have a new article out (slated to be published in the American University Law Review) that describes the “surprising reach of FDA” after descheduling of cannabis. Part III of the article runs from page 26 to page 50, and in those pages I explain what products FDA could assert jurisdiction over, as well as exactly how each type of product would be regulated.

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