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Powerhouse Points: Cosmetics Containing CBD - How Regulated Should They Be?

Written by Partner Kimberly A. Beis for the Summer 2021 Edition of Powerhouse Points,  A Quarterly Litigation Update.

Read the full issue here.

Powerhouse Points: 

  • While the FDA has not explicitly banned CBD in cosmetics, it does maintain enforcement actions against companies that market their products incorrectly. The European Union has recently taken steps towards allowing CBD as an ingredient in cosmetics in its member states. 
  • Despite this progress, different states have different rules on CBD, and organizations that want to sell cosmetics nation-wide need to take into account these differences. 

Cosmetic products containing CBD are everywhere! Lotions, bath salts, serums, powders, shampoo, makeup.  Deciding which ingredients to include in a product, how and where to manufacture, and what marketing claims to make are important and at times difficult decisions for a company to make.  

When considering the inclusion of CBD in a cosmetic product, the decisions can become even more complicated due to the lack of guidance from FDA and the differing stances of many states.  But given consumer interest in and demand for CBD products, it can also be an attractive option for many companies.  While the inclusion of CBD in a product can be complicated from a legal and regulatory standpoint, it is not impossible, and may very well be worth it – when done thoughtfully.  In order to properly label, market and sell a cosmetic product containing CBD, it is essential to get advice in order to limit the risk of legal action for any mistakes or misunderstandings.  Even if a product is already on the market, it is never too late to reevaluate your labeling and/or marketing, as well as where and how a product is sold.   

The FDA Has Nott Banned CBD in Cosmetics – but Has Not Explicitly Approved of it Either 

 First and foremost, it is important to understand how the FDA defines a “cosmetic.”  Cosmetics are defined by the FDA as "(1) articles intended to be rubbed, poured, sprinkled, or sprayed on, introduced into, or otherwise applied to the human body or any part thereof for cleansing, beautifying, promoting attractiveness, or altering the appearance, and (2) articles intended for use as a component of any such articles; except that such term shall not include soap."  However, if a product is intended to affect the structure or function of the body, or to diagnose, cure, mitigate, treat or prevent disease, it is considered a drug, or possibly both a cosmetic and a drug, even if it affects the appearance.  When a product is considered a drug, or both a drug and a cosmetic, a company may get a warning letter from FDA – which is becoming more common in relation to CBD products.

Thus far, FDA enforcement relating to CBD has focused on prohibiting companies from making any type of health claims about CBD, as such claims cause the FDA to classify that product as a drug.

CBD Warning Letters

In March 2021, the FDA sent warning letters to two companies for their CBD “pain relief” products. Because these products claimed to relieve pain, they were considered to be a misbranded drug. These two enforcement letters are particularly interesting because of the generic nature of the claims relating to “pain.”  Prior to these warning letters, most CBD product warning letters were issued because of claims to treat or cure diseases, like cancer or COVID-19. 

This arguably, makes enforcement of cosmetics containing CBD products the same as enforcement relating to all cosmetics.  The FDA is concerned about how the product is marketed; more specifically, that the product is not being marketed as a drug.

Marketing of Cosmetics – FDA’s Position

CBD has not been explicitly prohibited in cosmetic products by the FDA, and as noted above, enforcement relating to CBD containing products has been focused on products being misbranded or adulterated due to claims of treating, preventing or curing a disease.

The FDA will deem a cosmetic misbranded if it is labeled in a false or misleading way, does not comply with labeling requirements, or is made or filled in a deceptive manner. This is true for all cosmetics, whether they contain CBD or not.

The FDA has not determined that a cosmetic containing CBD is automatically adulterated or misbranded – but the FDA does appear to be paying close attention to the CBD market. As such, it is increasingly important for companies marketing cosmetic products containing CBD to ensure their marketing claims are appropriate for a cosmetic product.

CBD Added as a Legal Cosmetic Ingredient in the EU CosIng Database

The EU has stated, in its CosIng guidelines, that CBD, “derived from extract or tincture or resin of cannabis”, is a legal cosmetic ingredient.  Prior to this decision (which took place in February 2021), only synthetic CBD was explicitly allowed as a cosmetic ingredient.  This revision allows for plant-derived CBD to be in products to serve the function of anti-sebum, antioxidant, skin conditioner and skin protectant. 

This revision does not give carte-blanche to any company wanting to include CBD in its cosmetic products however. The EU CosIng database is a guideline for EU member states, when those states are determining their own regulations concerning cosmetics.   Many member states have their own CBD laws and regulations, which do not always follow CosIng or other EU member states. In addition each member state has its own manufacturing, labeling and marketing requirements.  The lack of consistency across member states makes it difficult for companies selling cosmetics containing CBD to freely trade those products throughout the EU. 

However the Court of Justice of the European Union (CJEU) recently ruled that CBD derived from the hemp plant is not a narcotic, and can therefore be traded between EU member states. As rulings by the CJEU are binding on all EU members states, this decision will likely result in more consistency in rules, regulations, and enforcement relating to CBD cosmetics in EU member states. 

California Says “No” to CBD is Cosmetics – Through an FAQ

In January 2021, the California Department of Public Health (CDPH) issued a revision to its FAQs relating to inclusion of CBD in various products.  The FAQ explicitly adopts the FDA’s position banning CBD as a food additive, dietary supplement, or pet food, and then, surprisingly, expressly states CBD is an adulterant in food AND cosmetics. 

California’s Sherman Food and Drug Law provides that a food product is adulterated if it has any food additive that is unapproved, and that a cosmetic is adulterated if it has any “poisonous or deleterious substance that may render it injurious to user under the conditions of the use prescribed in the labeling or advertisement of the cosmetic, or under conditions of use as are customary or usual.”  

Unlike the FDA, the CDPH has explicitly stated CBD (from hemp or any other source) is not allowed in items regulated by the Food and Drug Branch of CDPH – which includes food, drugs and cosmetics.  This position is far more restrictive than the FDA regulations, but is quite clear –CBD is not approved for use in cosmetics.  

Interestingly, California did not alter its regulations through a rule making process, but merely by issuing an updated FAQ. Many states are working hard to regulate CBD products – and ensure they are safe for the public - and the hope is California and FDA will do the same.   Enforcement of cosmetics containing CBD in California will be important to watch, particularly given the number of products already on the market. 

One State is Not Like the Other - As the CBD Industry Continues to Grow

Currently, each of the 50 states approaches products containing CBD in their own way, and while there is a great deal of overlap across many states, there is also a great deal of divergence.   As noted, California has recently banned CBD from food and cosmetics products.  Colorado requires very specific labeling requirements. And in Idaho, CBD is entirely illegal.  
    
The CBD market has grown exponentially in the past few years, and while uniform regulation is hoped for (and somewhat expected), as of right now, this growing industry faces some complexities for nation-wide sales.  If a company intends to sell a product containing CBD throughout the United States, it is important to conduct the necessary due diligence for each of the 50 states to limit risk and exposure to enforcement actions from regulatory agencies as well as consumer civil lawsuits.