Similar to a year ago, when the Food & Drug Administration (FDA) issued warning letters to six companies, the FDA issued several warning letters to marketers of products with cannabidiol (CBD):

The letters are all fairly similar and criticize health claims made by the company as supplements. Unless the product was marketed before GW Pharma (NASDAQ: GWPH) published clinical trials, the companies can’t make health claims:

FDA has concluded that CBD products are excluded from the dietary supplement definition under section 201(ff)(3)(B)(ii) of the Act [21 U.S.C. § 321(ff)(3)(B)(ii)]. Under that provision, if a substance (such as CBD) has been authorized for investigation as a new drug for which substantial clinical investigations have been instituted and for which the existence of such investigations has been made public, then products containing that substance are outside the definition of a dietary supplement. There is an exception if the substance was “marketed as” a dietary supplement or a conventional food before the new drug investigations were authorized; however, based on available evidence, FDA has concluded that this is not the case for CBD.

Note that this is a very broad attack on the CBD-from-hemp industry and includes products from CannaVest (OTC: CANV) as well as other companies like Endoca and Bluebird Botanicals.

Here is the first letter, with links provided above to all of the others:

February 4, 2016

WARNING LETTER

VIA OVERNIGHT DELIVERY

VIA EMAIL

Vance Ryan

ABC Productions

800 S Pacific Coast Highway Unit 230

Redondo Beach, CA 90277

Re: 480677

Dear Mr. Ryan:

This is to advise you that the Food and Drug Administration (FDA) reviewed your website at the Internet address www.calistores.com in January 2016 and has determined that you take orders there for the products “CBDy CBD Drops Unflavored Hemp Oil Supplement Cannabidiol Tincture” and “Hermosa Farm CannaHoney CBD, Cannabidiol Honey CBD 6oz” both of which claim to contain cannabidiol (CBD). We have also reviewed your website at the Internet address www.cbdy.com, which provides a link to your website www.calistores.com where these products can be purchased directly. The claims on your websites establish that these products are drugs under section 201(g)(1)(B) of the Federal Food, Drug, and Cosmetic Act (the Act) [21 U.S.C. § 321(g)(1)(B)] because they are intended for use in the cure, mitigation, treatment, or prevention of disease. As explained further below, introducing or delivering these products for introduction into interstate commerce for such uses violates the Act. You can find the Act and FDA regulations through links on FDA’s home page at www.fda.gov.

Based on the product label it appears you may intend to market your “CBDy CBD Drops Unflavored Hemp Oil Supplement Cannabidiol Tincture” product as a dietary supplement. You should be aware that, based on available evidence, FDA has concluded that CBD products are excluded from the dietary supplement definition under section 201(ff)(3)(B)(ii) of the Act [21 U.S.C. § 321(ff)(3)(B)(ii)]. Under that provision, if a substance (such as CBD) has been authorized for investigation as a new drug for which substantial clinical investigations have been instituted and for which the existence of such investigations has been made public, then products containing that substance are outside the definition of a dietary supplement. There is an exception if the substance was “marketed as” a dietary supplement or a conventional food before the new drug investigations were authorized; however, based on available evidence, FDA has concluded that this is not the case for CBD.

The existence of substantial clinical investigations regarding CBD has been made public. For example, two such substantial clinical investigations include GW Pharmaceuticals’ investigations regarding Sativex and Epidiolex[1]. FDA considers a substance to be “authorized for investigation as a new drug” if it is the subject of an Investigational New Drug application (IND) that has gone into effect. Under FDA’s regulations (21 CFR 312.2), unless a clinical investigation meets the limited criteria in that regulation, an IND is required for all clinical investigations of products that are subject to section 505 of the FD&C Act. FDA is not aware of any evidence that would call into question its current conclusion that CBD products are excluded from the dietary supplement definition under section 201(ff)(3)(B)(ii) of the FD&C Act, but you may present the agency with any evidence that has bearing on this issue.

Examples of some of the claims on your website www.calistores.com that provide evidence that your products are intended for use as drugs include the following:

On the “CBDy CBD Drops Unflavored Hemp Oil Supplement Cannabidiol Tincture” and “Hermosa Farm CannaHoney CBD Cannabidiol Honey 6oz” product webpage:

“[C]annabidiol…is considered to have a wider scope of medical applications than THC, including to…multiple sclerosis spasms, anxiety disorders, Bipolar Disorder, schizophrenia, nausea, convulsion and inflammation, as well as inhibiting cancer cell growth.”

“CBD has been shown to reduce growth of aggressive human breast cancer cells in vitro, and to reduce their invasiveness.”

Examples of claims on your website www.cbdy.com that provide evidence that your CBDy CBD Drops Unflavored Hemp Oil Supplement Cannabidiol Tincture product is intended for use as a drug include the following:

Under the FAQ Page:

“CBD may relieve symptoms of rheumatoid arthritis, diabetes, chronic pain, schizophrenia, PTSD…Alzheimer’s, Parkinson’s, HIV, dementia, multiple sclerosis, anxiety, bipolar disorders, nausea…and inflammation, as well as inhibiting cancer cell growth.”



“CBD has been shown to reduce growth of aggressive human breast cancer cells in vitro and to reduce their invasiveness.”

Your products “CBDy CBD Drops Unflavored Hemp Oil Supplement Cannabidiol Tincture” and “Hermosa Farm CannaHoney CBD Cannabidiol Honey 6oz” are not generally recognized as safe and effective for the above referenced uses and, therefore, the products are “new drugs” under section 201(p) of the Act [21 U.S.C. § 321(p)]. New drugs may not be legally introduced or delivered for introduction into interstate commerce without prior approval from the FDA, as described in sections 301(d) and 505(a) of the Act [21 U.S.C. §§ 331(d), 355(a)]. FDA approves a new drug on the basis of scientific data and information demonstrating that the drug is safe and effective.

A drug is misbranded under section 502(f)(1) of the Act [21 U.S.C. 352(f)(1)] if the drug fails to bear adequate directions for its intended use(s). “Adequate directions for use” means directions under which a layperson can use a drug safely and for the purposes for which it is intended (21 CFR 201.5). Prescription drugs, as defined in section 503(b)(1)(A) of the Act [21 U.S.C. 353(b)(1)(A)], can only be used safely at the direction, and under the supervision, of a licensed practitioner.

Your products “CBDy CBD Drops Unflavored Hemp Oil Supplement Cannabidiol Tincture” and “Hermosa Farm CannaHoney CBD Cannabidiol Honey 6oz” are intended for treatment of one or more diseases that are not amenable to self-diagnosis or treatment without the supervision of a licensed practitioner. Therefore, it is impossible to write adequate directions for a layperson to use your products safely for their intended purposes. Accordingly, “CBDy CBD Drops Unflavored Hemp Oil Supplement Cannabidiol Tincture” and “Hermosa Farm CannaHoney Cannabidiol Honey 6oz” fail to bear adequate directions for their intended uses and, therefore, the products are misbranded under section 502(f)(1) of the Act [21 U.S.C. § 352(f)(1)]. The introduction or delivery for introduction into interstate commerce of these misbranded drugs violates section 301(a) of the Act [21 U.S.C. § 331(a)].

The violations cited in this letter are not intended to be an all-inclusive statement of violations that exist in connection with your products and their labeling. You are responsible for investigating and determining the causes of the violations identified above and for preventing their recurrence or the occurrence of other violations. It is your responsibility to ensure that your firm complies with all requirements of federal law and FDA regulations.

You should take prompt action to correct the violations cited in this letter. Failure to promptly correct these violations may result in legal action without further notice, including, without limitation, seizure and/or injunction.

Within fifteen working days of receipt of this letter, please notify this office in writing of the specific steps that you have taken to correct violations. Include an explanation of each step being taken to prevent the recurrence of violations, as well as copies of related documentation. If you cannot complete corrective action within fifteen working days, state the reason for the delay and the time within which you will complete the correction.

If you need additional information or have questions concerning any products distributed through your website, please contact the FDA. You may respond in writing to Mabel Lee at Food and Drug Administration, Center for Food Safety and Applied Nutrition, 5100 Paint Branch Parkway, College Park, MD 20740. If you have any questions concerning this letter, please contact Ms. Lee at FDAADVISORY@fda.hhs.gov.

Sincerely yours,

/S/

William A. Correll

Director

Office of Compliance

Center for Food Safety

and Applied Nutrition

[1] See “Sativex Commences US Phase II/III Clinical Trial in Cancer Pain,” available at http://www.gwpharm.co.uk/Commences%20US%20Phase%20IIIII%20Clinical%20Trial.aspx and “GW Pharmaceuticals Receives Investigational New Drug (IND) from FDA for Phase 2/3 Clinical Trial of Epidiolex in the Treatment of Dravet Syndrome,” available here.

Get ahead of the crowd by signing up for 420 Investor, the largest & most comprehensive premium subscription service for cannabis traders and investors since 2013.

Breaking News by Alan Brochstein, CFA Facebook | LinkedIn | Email Based in Houston, Alan leverages his experience as founder of online communities 420 Investor , the first and still largest due diligence platform focused on the publicly-traded stocks in the cannabis industry. With his extensive network in the cannabis community, Alan continues to find new ways to connect the industry and facilitate its sustainable growth. At New Cannabis Ventures , he is responsible for content development and strategic alliances. Before shifting his focus to the cannabis industry in early 2013, Alan, who began his career on Wall Street in 1986, worked as an independent research analyst following over two decades in research and portfolio management. A prolific writer, with over 650 articles published since 2007 at Seeking Alpha , where he has 70,000 followers, Alan is a frequent speaker at industry conferences and a frequent source to the media, including the NY Times, the Wall Street Journal, Fox Business, and Bloomberg TV. Contact Alan: Twitter