A Joint Crackdown from the FTC and FDA on Medical Treatment Claims from CBD Companies

The Federal Trade Commission (FTC) and the U.S. Food and Drug Administration (FDA) jointly sent warning letters on April 3, 2019 to companies that advertise and sell cannabidiol (CBD) containing products via internet websites. The reason? According to the FTC and FDA, the advertising and marketing strategies violate the Federal Food, Drug, and Cosmetic Act, FDA regulations, and the FTC Act.

The letters referred to three main issues that companies need to be aware of when advertising CBD containing products:

1) General claims that CBD products are intended for use in the diagnosis, cure, mitigation, treatment, or prevention of disease or illness are prohibited by the FDA, unless the products are drugs that have been approved by the FDA (e.g., EPIDOLEX). This includes products and drugs for animals;

2) Products with CBD as an active ingredient cannot be referred to as dietary supplements because CBD is an active ingredient in the FDA approved drug product, EPIODIOLEX; and

3) Advertisements that claim products can prevent, treat, or cure human disease violate the FTC Act, unless the promoter possesses competent and reliable scientific evidence and/or studies that substantiate the claims.

In the letter to PotNetwork Holdings, Inc., the FDA asserted that certain claims made by the website provide evidence that the products were intended for use as unapproved drugs. For example, claims that “CBD may be neuroprotective in adult and neonatal brain trauma”, “CBD…treatment effectively blocked the progression of arthritis”, and “CBD [has] been shown in research to have therapeutic possibilities in helping diabetes,” were specifically referenced by the FDA as proof of general claims that CBD can be used for prevention of disease or illness. The FDA’s position is that claims do not even have to be fully conclusive for the FDA to find them in violation of the law. The use of modifiers such as “may be effective” or “possibly therapeutic” do not make them legal.

In that same letter, the FDA addressed claims referring to CBD products as “nutritional supplements.” The FDA considers nutritional supplements and dietary supplements to be the same thing and products with CBD as an active ingredient cannot be referred to as dietary or nutritional supplements. As CBD is the active ingredient in an approved drug product, EPIDIOLEX, and substantial clinical investigations regarding CBD have been made public, the FDA determined that the restriction for dietary supplements applies to CBD. The FDA has taken the position that even when the products are intended to be marketed as foods, such as CBD infused gummies or cookies, claims may still be prohibited because if foods have ingredients including drugs undergoing substantial clinical trials, they cannot be introduced into interstate commerce, unless the food was marketed before the trials began.

In the letter to Nutra Pure, LLC, the FDA asserted that some CBD products were misbranded drugs because they do not bear adequate directions for their intended use. The FDA claims Nutra Pure’s Hemp Oil and CBD Softgels were intended for treatment of diseases that are not amenable to self-diagnosis or treatment without supervision of a licensed doctor. Thus, the FDA claims it is not possible to include adequate instructions for a layperson to use them safely. According to the warning letters, this alleged misbranding is a violation of FDA regulations.

In all three letters, the FTC asserted that the websites for the products at issue include unsubstantiated advertising claims that CBD products can prevent, treat, or cure human diseases and the FTC is not aware of any competent and reliable scientific evidence, including human clinical studies, substantiating such treatment claims. The FTC further asserted that making such unsubstantiated advertising claims directly or indirectly, through use of a product name, website name, metatag, or any other means, without rigorous scientific evidence to substantiate the claims, is a violation of FTC regulations. The FTC recommended each entity review all claims for the respective products and ensure that they are supported by “competent and reliable scientific evidence”, to avoid federal legal action and potential mandatory refunds to customers.

According to the above letters and claims from the FDA and FTC, proprietors of CBD products will want to be particularly careful when (1) making any claims that a product may be used in the diagnosis, cure, mitigation, treatment or prevention of any disease or illness and (2) advertising products that include CBD as an active ingredient as such products cannot be sold as dietary supplements or as food products. Further, the FTC takes the position that any claims dealing with the prevention, treatment, or cure of a human disease should not be made without competent and reliable scientific evidence or studies to substantiate any such claim.

With the passage of the Farm Bill expanding the market and availability for CBD products, producers and sellers will want to make sure that they carefully review their websites, including social media pages, and any other forms of advertising, to reduce the risk that they will receive warning letters from the FDA and/or FTC for alleged violations of labeling and advertising laws.