CBD’s legal limbo: Ambiguous regulatory status bolsters search for new alternatives

01 Aug 2024 --- Industry experts note that legal challenges for CBD in Europe and the US limit market developments and innovations as the market examines alternative ingredients. We dive into the CBD market and developments with professionals from Gencor, Red Mesa Science & Refining and Alkemist Labs.

Although the EU determined that CBD can be considered a Novel Food ingredient, the European Food Safety Authority found that knowledge and data gaps need to be addressed before concluding CBD’s safety. Maggie McNamara, VP of marketing at Gencor, tells Nutrition Insight that “there are still no CBD products that have received authorization via the EU’s Novel Foods regulatory pathway.”

After being urged to speed up CBD’s authorization process, the UK Food Standards Agency has conducted two safety assessments on CBD as a novel food — synthetic CBD for food supplements and CBD isolate for use in several food categories, including supplements. Both assessments, published in April 2024, conclude that the novel food “was safe under the proposed conditions of use” and that anticipated intake levels were “not considered to be nutritionally disadvantageous.”

“There are no unanimous laws regulating commercially available CBD products,” says McNamara. “The available scientific data concerning CBD’s efficacy is insufficient, but due to the ambiguity surrounding its regulatory status and safety, there has been little movement regarding research and innovations.”

“Launching a CBD can carry inherent risks for a manufacturer, so until further legislation is passed, finding alternatives in the space may be the best route for market development and innovations.”

US regulation status
Meanwhile, the US has legalized hemp federally by passing the 2018 Farm Bill. Jeff Applegate, president of Red Mesa Science & Refining, a large-scale refiner of cannabinoids, details that the Green Rush that followed this law brought significant investment. “Unfortunately, most industry players were not experienced, capable or qualified to survive.”

At the same time, the US FDA has determined that a new regulatory pathway needs to be developed to regulate CBD products. US stakeholders urge the agency to regulate them as supplements.

Top positionings for CBD launches include brain or mood health, insomnia and health or wellness supplements.“The FDA’s lack of regulation for CBD and hemp-derived cannabinoids created further complexity and placed pressure on the states to regulate CBD legislatively, limiting widespread market adoption and industry maturation,” adds Applegate.

“Evolving regulations at state and federal levels continue to influence how companies operate, innovate, develop and market their products. As a result, pioneering end-product market development is primarily left to start-ups and smaller businesses, often nimbler with ongoing changes than larger consumer-packaged goods companies.”

CBD supplements
Within the nutrition market, Innova Market Insights data indicates that supplements account for the largest share of April 2023–March 2024 product launches (95%), with the remainder consisting of sports nutrition products.

Botanical or herbal supplements accounted for the largest share of CBD launches (77%). Melatonin supplements with CBD grew 73% and vitamin or mineral supplements with CBD grew 19%. Last year’s top positionings for CBD launches included brain or mood health supplements (42%), insomnia supplements (42%) and health or wellness supplements (22%).

Supplements and sports nutrition launches with CBD ingredients with the fastest growth from April 2019 to March 2024 included sexual health supplements (63%), sports nutrition for joint health (19%) and energy and stamina supplements (18%).

Data from Innova Market Insights indicates that from April 2023 to March 2024, the top CBD ingredients in supplements and sports nutrition included CBD (86%), CBD isolate (11%) and CBD oil (5%). Over the last five years, CBDA (cannabidiolic acid) product launches have grown the fastest, at 24%.

Market developments
Applegate cautions that increased demand and supply shortages in the CBD market present significant challenges and growth opportunities for businesses in the sector.

“From a hemp processor perspective, there is a continued reduction of hemp farmers and acreage planted along with extraction and refining operations. This has led to a scarcity of input feedstocks, often lacking purity and quality standards,” he explains.

“Consequently, prices for cannabinoid raw ingredients have surged as reputable product formulators seek suppliers with robust quality systems and operational standards to stabilize batch inputs to produce high-quality cannabinoid outputs.”

Applegate sees a continued reduction of hemp farmers and acreage planted along with extraction and refining operations.However, Applegate also sees a flourishing product development as post-pandemic consumers increasingly prioritize self-care and holistic wellness. “This shift drives CBD’s growth across various applications, including functional foods, fortified beverages, dietary supplements, tinctures, beauty and skin care products and therapeutic topicals.”

“Companies continue innovating with new formulations and delivery methods in alignment with broader wellness trends. These innovations aim to improve access to CBD and other minor cannabinoids while enhancing the effectiveness and user experience for health-conscious consumers.”

He expects that consolidation in the industry will continue, but adds that remaining players will elevate quality standards and consistency.

“With ongoing legislative efforts at the federal level to regulate hemp-derived cannabinoids, we see new markets opening to increase consumer access in the US. At the same time, more countries are relaxing their CBD regulations, creating opportunities for international expansion and market penetration.”

Search for alternatives
Gencor’s McNamara highlights the emergence of CBD alternatives following regulatory issues. She adds that the research on CBD’s health benefits is insufficient. Moreover, she cautions that the number of mislabeled products and lack of compliance with Good Manufacturing Practices continues and that further education is needed.

In addition, she details that nearly one-third of US households are not confident in their understanding of the difference between full-spectrum CBD, broad-spectrum CBD and CBD isolate.

“Until more regulation is passed and consumer education continues, there is a way to navigate legal and regulatory matters by using a safe, clinically validated alternative such as PEA.”

McNamara highlights the emergence of CBD alternatives following regulatory issues (Image credit: Red Mesa Science & Refining).According to McNamara, PEA, or palmitoylethanolamide, is an alternative clinically validated way to mediate the same key set of receptors as CBD, specifically CB1, CB2, GPR55, PPAR and the TRPV1 protein receptor. “PEA is an endocannabinoid-like lipid mediator primarily known for its anti-inflammatory, analgesic and neuroprotective properties.”

She explains: “It appears to have a multi-modal mechanism of action by primarily activating the nuclear receptor PPAR-α while also potentially working through the endocannabinoid system, thus targeting similar pathways as CBD.”

“With proven efficacy in several therapeutic areas, its safety and tolerability profile and the development of formulations that maximize its bioavailability, PEA is a promising alternative to CBD.”

The endocannabinoid system
Gencor’s Levagen+ is a bioavailable PEA ingredient that benefits the endocannabinoid system. McNamara explains: “It is a naturally occurring fatty acid amide structurally related to the endocannabinoid transmitter, anandamide, also known as the bliss molecule. Unlike anandamide, PEA does not bind to cannabinoid receptors and produces various protective effects, including reduced pain and inflammation.”

She adds that PEA works directly and indirectly within the central and peripheral nervous systems.

“Directly, PEA reduces inflammation locally by halting pro-inflammatory genes’ activity and producing many inflammatory substances via PPAR-α receptors. Indirectly, PEA enhances the levels and actions of anti-inflammatory compounds (e.g., anandamide) that provide analgesic relief. This mechanism is known as the ‘entourage effect.’”

Although they are biogenetically different, CBD and PEA have pharmacological similarities. For example, PEA counteracts endotoxin-induced inflammation in cells in the same cell lineage as CBD. Numerous clinical studies have shown that PEA is an effective and safe anti-inflammatory, analgesic and tissue-protective nutrient. PEA has multiple applications in joint health, sports nutrition, sleep, recovery and healthy aging.

McNamara details that Levagen+ has been shown to “promote restful sleep, increase REM sleep, support immune health, improve mood and offer relief of aches and discomfort.”

CBD products are tested for the cannabinoid profile, which includes the CBD concentration (Image credit: Red Mesa Science & Refining).Laboratory testing and analysis
Dr. Anthony Fontana, lab director at Alkemist Labs, a laboratory that conducts botanical plant testing and has expanded capabilities in phytochemical potency analysis, gives us an update on CBD testing.

“Lab testing plays a critical role in ensuring the potency and purity of the CBD in the market, as it does for all botanicals. A brand is responsible for ensuring that the product contains what the label says it does, which is confirmed by testing.”

He explains that CBD products are tested for the cannabinoid profile, which includes the CBD concentration. The tests examine identity and potency. Additional tests for purity are sometimes requested.

Although there have been no changes in terms of requirements, compounds tested, or the amount of analysis requested, Fontana notes that Alkemist Labs doesn’t conduct “much CBD industry testing now since the market contracted quite a bit from the early years.”

“In the US, because of CBD’s odd regulatory limbo, government requirements for CBD products can vary from state to state. Even brands well-versed in supplement and personal care regulatory requirements don’t always realize this at first. This can include labeling, testing requirements, and additional paperwork that may need to be filed state by state.”

By Jolanda van Hal

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