DENVER -- At a recent conference here, Denver and Colorado public health officials recounted their scariest hemp CBD manufacturing stories to a packed hotel ballroom.
There was the woman who was making hemp oil in her kitchen crockpot and selling it online. The manufacturing facility with no sinks for workers to wash their hands. The facility where dogs ran underfoot. The outdoor festival where patrons snacked on CBD-flavored popcorn, bought online, labeled only with the assertion "Made in America."
Hemp cannabidiol (CBD), a cannabis extract largely unknown a few years ago, has become so popular that some Americans take a spoonful every day. People are vaping CBD, drinking CBD-infused coffee and snacking on CBD-infused chocolates in the hopes of easing their aches, pains and anxiety.
But the health benefits of cannabidiol are unclear, and many products hitting the market haven't been made in clean, permitted facilities or tested for toxic pesticides, heavy metals and bacteria, according to state officials, hemp businesses and news reports.
Some product labels overstate or understate CBD concentration, a 2017 Penn Medicine study showed. And some vapes and edibles marketed as CBD contain illegal compounds that can make people sick, such as synthetic marijuana, an Associated Press investigation recently found.
As U.S. farmers prepare to harvest thousands of acres of CBD-rich plants this year, state and federal officials have yet to agree on how the popular hemp extract should be manufactured, tested and labeled to protect the public. Some states, such as North Carolina, don't yet monitor companies that extract CBD oil from hemp plants, and officials in other states are struggling to enforce existing regulations.
"Consumers got ahead of the regulatory framework, basically," said New York Assemblywoman Donna Lupardo, a Democrat who sponsored hemp extract labeling legislation this year. "We really are building a plane as we're flying it."
New York holds CBD processors to the same manufacturing standards as dietary supplement makers -- a higher bar than most states -- and requires extracts made in the state to be tested for contaminants.
Lupardo's bill, which passed the state legislature unanimously this summer, would allow regulators to create permits for retailers and stricter rules for product labeling; to ban the sale of out-of-state products that don't meet New York standards; and to require retailers to get a special permit.
Gov. Andrew Cuomo, also a Democrat, has yet to sign the legislation. Jason Conwall, deputy communications director for the governor, told Stateline in an email that the bill is under review.
Some hemp growers in the state backed Lupardo's bill. Unsafe and mislabeled products are bad for business, said Allan Gandelman, founder of the New York Cannabis Growers and Processors Association. "There's a high potential to actually lose customers."
The U.S. Hemp Roundtable, an industry group based in Lexington, Ky., opposed the New York bill, saying it "could dramatically impair the hemp industry."
"Such over-regulation would hold licensees and retailers liable for a broad range of potential violations," the organization said in a June message to its members, "that could result in both confusion for consumers and harm to licensees."
The U.S. Food and Drug Administration, the federal agency that oversees food product safety, has struggled to respond to the hemp CBD boom. The agency maintains that cannabidiol can't be sold as a food ingredient or as a dietary supplement because cannabidiol is an active ingredient in a prescription drug for treating rare seizure disorders, and it is unlawful to introduce drugs into the food supply.
Yet edible, drinkable and smokable CBD products have flooded the market anyway, delivering big profits to some farmers and manufacturers and purportedly helping many consumers manage their health problems. The Hemp Business Journal, an online industry publication that tracks hemp sales, estimates that the hemp CBD market will grow from $390 million in 2018 to about $1.3 billion by 2022.
Under pressure from the hemp industry and CBD users, the FDA is exploring whether to craft an exception for cannabidiol that will allow it to be sold as a food ingredient or dietary supplement. The agency has said it will release an update on its progress this fall.
In the meantime, states have come up with their own hemp CBD rules. Many states, including New York and California, have followed the FDA's lead and banned cannabidiol-infused food for now. On the other hand, Colorado last year legalized CBD as a food ingredient.
Some states hold hemp extract makers to the same standards as food processors. In Colorado and Kentucky, for instance, CBD manufacturers must follow basic food safety rules, such as refrigerating perishables and maintaining a clean facility. And they must list ingredients on their packaging.
But while Kentucky requires manufacturers to test their products for heavy metals, pesticides and bacteria, Colorado does not, regulators say. Both states require testing for tetrahydrocannabinol, or THC, the cannabinoid that creates a high, as products with over 0.3% concentration of THC are considered marijuana under federal law.
Colorado CBD manufacturers are "strongly encouraged" to perform additional tests, and many do, said Jeff Lawrence, director of the Division of Environmental Health and Sustainability at the Colorado Department of Public Health and Environment.
But many entrepreneurs hoping to cash in on CBD don't go the extra mile on testing, or know much about public health. While there are no known instances of someone in Colorado getting sick after consuming CBD, state officials say, people have fallen ill elsewhere. Fifty-two people in Utah in 2017 and early 2018 experienced nausea, vomiting and seizures after consuming -- in most cases vaping -- a synthetic product marketed as CBD.
After Coloradans voted to legalize recreational marijuana in 2012, Denver saw a similar boom in cannabis entrepreneurship, said Kara Lavaux, food and cannabis supervisor at the Denver Department of Public Health and Environment. "That brings with it folks who don't have food safety experience, or pharmaceutical experience."
Hemp presents regulators with an additional challenge, however, because while marijuana products must be made in Colorado from plants grown in Colorado, hemp products can be sourced from all over the world.
When members of Lavaux's team find hemp concentrates for sale in city stores or on restaurant menus, they try to establish whether the extract was made in a place with safety standards similar to Colorado's. If the source can't be verified, or doesn't meet state standards, the department issues a citation to the food business, she said.
Statewide, regulators are scrambling to keep up with the fast-growing industry. Lawrence said his team has inspected less than half of the state's 400-odd manufacturers of hemp CBD products. Ultimately, he said, he'd like to have enough staff to inspect facilities annually.
Smokable hemp products, such as vapes, are subject to even fewer regulations than hemp CBD oils and edibles in Colorado. "There are zero testing requirements for those types of products," Lavaux said. Lawrence said that a working group organized by the state agriculture and health departments plans to discuss the vaping issue.
Lawmakers in several states are considering bills that would expand oversight of hemp extracts or tighten testing and labeling requirements. A California bill, for instance, would require hemp CBD products to be tested for toxins while also allowing the extract to be added to food, beverages and cosmetics. The bill passed the state Assembly unanimously in May and is working its way through Senate committees.
In North Carolina, an annual farm bill before the state legislature would allow the North Carolina Department of Agriculture and Consumer Services to start regulating hemp CBD processors.
"Currently, in North Carolina, we do not believe we have the statutory authority to inspect these facilities," said Joe Reardon, assistant commissioner for consumer protection at the agency.
The legislation has been stalled for months, however, as lawmakers fight over a proposed ban on hemp cigarettes and cigars. About a quarter of the fast-growing North Carolina hemp industry's revenue comes from smokable products, according to Blake Butler, executive director of the North Carolina Industrial Hemp Association.
In New York, Gandelman supports tighter labeling requirements under Lupardo's bill and said he sees mislabeled CBD products on store shelves all the time. A hemp farmer and owner of a hemp extracts business, Gandelman said he routinely confronts rival business owners at trade shows and over email when he discovers that the CBD concentration advertised on their label doesn't match their test results.
"Because there's no regulations or laws about it," he said, "they can really put whatever they want in that bottle, and whatever they want on that bottle."
Hemp industry leaders are trying to promote better manufacturing practices. "We consider the enemy of the industry not cops or the FDA -- the enemy of the industry are those fly-by-night companies that come in and sell products that are potentially harmful to people," said Jonathan Miller, general counsel for the U.S. Hemp Roundtable. "They come in and give us a black eye."
A new industry-backed organization -- the U.S. Hemp Authority, also based in Lexington, Ky. -- awarded its first certifications this spring. Hemp growers and CBD processors follow certain guidance, such as including safety warnings on labels and thoroughly drying hemp plants to prevent mold and bacteria, and pay a fee to use the official-sounding label.
Miller argued, however, that hemp-derived CBD shouldn't be regulated as tightly as marijuana-derived CBD. "We oppose holding hemp products to the same standards as marijuana, for the very reason that marijuana can get you high," he said, "and marijuana is a controlled substance, and hemp is not."
Some savvy -- and often well-financed -- hemp CBD companies are going above and beyond state requirements. Gandelman's company not only tests extracts for potency and contaminants, but also posts the lab results online, so customers can see what they're buying.
Tim Gordon, president of the Colorado Hemp Industries Association, said companies that don't prepare for tougher regulations -- particularly from the FDA -- will be at a competitive disadvantage.
"There are still a number of these brands that are operating from a household kitchen, or a garage or something like that," he said. If they don't prepare for regulation, he said, "they are going to be left in the dust."
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