Health Law Advisor

In this episode of the Diagnosing Health Care Podcast: Will the reclassification of marijuana from a Schedule I to a Schedule III drug disrupt the cannabis marketplace? What consequences must industry stakeholders consider if the Drug Enforcement Administration's proposal becomes a reality?

On this episode, special guests Anthony Minniti, a New Jersey-licensed pharmacist, and Stacey Udell, an accountant with expertise in representing cannabis operators across the United States, join Epstein Becker Green attorney Lisa Gora to discuss the regulatory domino effect and tax implications related to this major potential change to the cannabis industry.

As of September 25, 2023, Bill A4151 was approved by the New Jersey Senate and is now law in New Jersey. This approved bill amends the existing New Jersey recreational cannabis regulatory landscape. Bill A4151, or P.L. 2023, c.162, (the “Amendment”) revises and waives certain restrictions currently imposed on owners of cannabis establishments. Prior to the enactment of the Amendment, Class 5 retail license holders and their owners, were prohibited from holding interest in other Class 5 retail licenses because horizontal expansion is otherwise prohibited under the state’s ...

On August 30, an official at the United States Department of Health and Human Services (HHS) released one of the most significant announcements made at the federal level concerning marijuana reclassification. In a letter dated August 29, 2023, Rachel Levine (HHS Assistant Secretary for Health), provided a formal recommendation to Anne Milgrim (Agency Administrator) at the United States Drug Enforcement Agency (DEA) to reclassify cannabis from a Schedule I drug to a Schedule III drug under the Federal Controlled Substances Act (CSA).

A DEA spokesperson confirmed the department ...

New York State cannabis agencies and related individuals were served with a lawsuit from four New York veterans (Carmine Fiore, William Norgard, Steve Mejia, and Dominic Spaccio, collectively, the “Plaintiffs”) related to the cannabis market and licensing structure on August 2, 2023. The Plaintiffs are alleging that under the Conditional Adult-Use Retail Dispensary (“CAURD”) licenses, state officials have been favoring “Justice Involved” individuals over disabled veterans in the application process. Their lawsuit has thus far led to the issuance of a ...

In this episode of the Diagnosing Health Care Podcast:  Federal and state cannabis regulation and enforcement appear to be moving in different directions. While the Food and Drug Administration (“FDA”) has broadened its net to target businesses making claims that their products can treat specific conditions, a growing number of states have passed bills that, among other things, legalize adult-use cannabis.

Epstein Becker Green attorneys Delia Deschaine, Nathaniel Glasser, and Megan Robertson discuss how developments in 2021 impact the cannabis industry and why ...

FDA took two important steps last week to clarify the regulatory landscape for cannabis products, including CBD products.  First, FDA issued a draft guidance on Quality Considerations for Clinical Research Involving Cannabis and Cannabis Derived Compounds.  This guidance builds off of earlier guidance FDA has issued about the quality and regulatory considerations that govern the development and FDA approval of cannabis and/or cannabinoid drug products.  See e.g., here and here.  The draft guidance iterates a federal standard for calculating delta-9 THC content in cannabis finished products, which addresses a significant gap in federal policy regarding those products.  While the testing standard is neither final nor binding on FDA or DEA, when finalized it would iterate what FDA considers to be a scientifically valid method for making the determination of whether a cannabis product is a Schedule I controlled substance.  Therefore, it may be useful in many contexts, including federal and state cannabis enforcement actions.  We encourage affected parties to file comments on FDA’s Guidance, which they may do until September 21, 2020.

Second, FDA sent to the Office of Management and Budget for review a proposal on how FDA intends to exercise enforcement discretion over CBD consumer products.  See here.  While the contents of this guidance have not yet been made public, we forecast that it likely will align with FDA’s past enforcement actions and memorialize the agency’s intent to pursue enforcement actions against CBD consumer product companies that make egregious claims about their products treating or preventing serious diseases or conditions.

Guidance on Considerations for Cannabis Clinical Research

FDA’s guidance recognizes that Congress’s enactment of the Agricultural Improvement Act of 2018 (“2018 Farm Bill”) improved domestic access to pre-clinical and clinical cannabis research material that may be used in the research and development of novel therapies.   However, currently marijuana only may be obtained domestically from the University of Mississippi under contract with the National Institute on Drug Abuse.  While DEA issued a policy in 2016 to allow for the additional registration of marijuana cultivators for legitimate research and licit commercial purposes, the Office of Legal Counsel in June 2018 issued an opinion finding that such policy violates the United States’ obligations under applicable treaties.  However, in March of this year, DEA issued a proposed rule to allow for the registration of additional cultivators of cannabis for these licit purposes.  See here.

There is an alternative pathway to the procurement of Schedule I research material which FDA’s guidance does not mention: importation.  Researchers may obtain certain Schedule I material pursuant to a federal DEA Schedule I importer registration, and DEA has in the past issued such registrations.  See 21 CFR 1301.13(e)(1)(viii).

The cannabidiol (“CBD”) consumer product marketplace is booming.  And, while FDA has maintained its position that CBD, even hemp-derived CBD, may not be included as an ingredient in conventional foods or dietary supplements, FDA has signaled its intent to create a lawful marketing pathway for these products.  Also, while FDA has issued Warning Letters to companies who made egregious claims about their products curing serious diseases and conditions like Alzheimer’s disease and cancer, FDA has also signaled a willingness to exercise enforcement discretion over CBD products that pose less serious safety concerns.  What has resulted is CBD manufacturers, retailers, and other businesses living in FDA regulatory purgatory.  Fortunately, several courts have recently held that CBD companies will not face consumer product liability, at least while their FDA regulatory fate is being decided.

A number of federal lawsuits were recently brought by consumers against manufacturers of various types of CBD products, ranging from ingestible foods and beverages, dietary supplements, topical oils and sprays, and vape products. The plaintiffs in these cases all bring similar claims, that the products purchased were misleading as to the amount of CBD in the product and/or that the products were mislabeled and falsely advertised as dietary supplements.  The plaintiffs’ claims are based, at least in part, on assertions that the defendants violated the federal Food, Drug, and Cosmetic Act (“FD&C Act”) by introducing adulterated and misbranded products into the U.S. market.

However, over the course of 2020, at least three judges have found that the outcome of these cases will have to wait until FDA completes its rulemaking on the regulation of CBD products. Citing the primary jurisdiction rule, the judges each issued a stay on their respective cases. The judges found that FDA has primary oversight over claims involving the illegal sale or marketing of CBD products, and that regulatory clarity is needed before a decision may be made on the matters brought by the plaintiffs. Thus, the fate of these cases now depend on when and whether FDA will issue regulations governing CBD products.

On August 9, 2019, Illinois Governor Pritzker signed legislation amending the state’s current medical marijuana pilot program. The Compassionate Use of Medical Cannabis Program Act (the “Medical Cannabis Act”) makes the medical marijuana program, which was initially enacted as a pilot program in 2013, permanent and expands the qualifying medical conditions for a medical marijuana card to include at least 12 new conditions, including chronic pain, irritable bowel syndrome, migraines, osteoarthritis, and ulcerative colitis. The Medical Cannabis Act also provides ...

On May 31, 2019, the U.S. Food and Drug Administration (“FDA”) hosted its much-anticipated public hearing titled “Scientific Data and Information about Products Containing Cannabis or Cannabis-Derived Compounds” (discussed in our prior blog post). The day-long hearing presented an opportunity for FDA panel members to engage directly with stakeholders on the regulatory future of cannabis or cannabis-derived products within the scope of FDA’s jurisdiction.

Acting FDA Commissioner Ned Sharpless, M.D., kicked off discussions, reminding the panel and ...