California Looks to Permit the Sale of CBD-Infused Product

Through a bill proposed earlier this year, California legislators appear to be on the verge of legalizing the sale of food, drink, and cosmetic products containing hemp or associated cannabinoids, such as cannabidiol (“CBD”). Per last year’s announcement from the California Department of Public Health (“CDPH”) and the California Food and Drug Branch (“FDB”), current state law defines food and beverages containing hemp as adulterated, meaning that it contains a substance that may negatively impact a consumer’s health. While some businesses have continued to sell these products despite California’s prohibition, Assembly Bill-228 (“AB 228”) looks to provide a measure of state protection to certified retailers by removing restrictions on the sale of products infused with hemp or industrial hemp derivatives.

Currently awaiting presentation before the state’s Senate Appropriations Committee next month, AB 228 has encountered little legislative opposition since its initial proposal in January.¹ Introduced by Assemblywoman Cecilia Aguiar-Curry (D) for immediate effect, the legislation reads:

“This bill would state that a food, beverage, or cosmetic is not adulterated by the inclusion of industrial hemp or cannabinoids, extracts, or derivatives from industrial hemp, and would prohibit restrictions on the sale of food, beverages, or cosmetics that include industrial hemp or cannabinoids, extracts, or derivatives from industrial hemp based solely on the inclusion of industrial hemp or cannabinoids, extracts, or derivatives from industrial hemp.”

AB 228 may be a reversal of California’s previous ban on CBD-laced consumables; however, several key issues remain unanswered. To start, the U.S. Food and Drug Administration (“FDA”) has yet to produce updated guidelines to address the Agriculture Improvement Act of 2018 (“2018 Farm Bill”) following their public hearing in late May, meaning that federally, edible products containing hemp and CBD are still illegal. The state’s initial prohibition on their sale was a decision by California health officials to uphold the FDA’s ruling on CBD’s yet to be determined health and safety effects on consumers; however, the enforcement of the ban has varied. ²

There are significant grey areas between federal and state law with regard to CBD. In the 2018 Regular Session, the State of Colorado passed HB 18-1295, which established that foods and cosmetics are not adulterated or misbranded simply by virtue of containing industrial hemp. Despite FDA’s prohibition, Colorado expressly permits CBD derived from industrial hemp in food products, provided that the manufacturers of such food products can demonstrate that the hemp comes from an approved source, that it conforms to the standard of identity established in statute, and that other parts of the plant (seed meal, flour, and oil) are not above allowable thresholds for THC. Manufacturers must also label the products as containing hemp (and CBD if applicable), must include a “not tested by FDA for efficacy and safety” statement, and manufacturers may not make any health claims in connection with their products. Like HB 18-1295, AB 228 does not set clear dosage limits. Nonetheless, foods containing CBD have been increasingly popular in Colorado and even Carl’s Jr. jumped on the bandwagon, releasing a CBD infused cheeseburger earlier this year.

Aside from the central FDA issue that has troubled the industrial hemp industry since the passage of the 2018 Farm Bill last December, AB 228 does not legalize food products that contain industrial hemp or cannabinoids, extracts, or derivatives from industrial hemp on the grounds of their safety. Rather, the bill would simply reclassify said goods as not “adulterated” and therefore permitting their sale by licensed retailers. AB 228 requires that a manufacturer of foods containing industrial hemp must be able to prove that all parts of the plant come from a state or country that has an established and approved industrial hemp program that inspects or regulates hemp under a food safety program or equivalent criteria to ensure safety for human consumption, and further requires that the industrial hemp cultivator or grower to be in good standing and compliance with the governing laws of the state or country of origin. In addition, much like the requirements set forth by the Colorado Department of Public Health and Environment, manufacturers of foods containing industrial hemp must include a warning statement on their labeling, and manufacturers are prohibited from making any health claims in connection with their products.

Further legislative evaluations on AB 228 are expected following the scheduled Senate Appropriations Committee hearing on August 12, 2019.

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Originally published July 25, 2019, at https://therodmanlawgroup.com