6th July 2020

A pot of gold? The highs and lows of getting CBD products to market

CBD infused versions of everyday products are becoming more prevalent. Chocolate, coffee, creams and oils containing Cannabidiol, or ‘CBD’, all offer calming and anti-inflammatory benefits to the consumer.

With its variety of uses, the rules surrounding the marketing of CBD change depending on its composition, and the use for which it is being promoted. This has prompted the Advertising Standards Authority to publish an updated tip sheet on dealing with advertising of CBD products.

We’ve written previously about the growth of the market for CBD, and as public awareness increases so does the need for regulation around the marketing of these CBD products. It is the responsibility of the company marketing the product to ensure that any associated advertising complies with the relevant regulatory landscape. They must follow the rules appropriate to the product being advertised - which can be difficult in a CBD context where so many classifications can apply.

CBD products that contain elements of THC (the main psychoactive compound in cannabis), are considered illegal or controlled substances. A licence is required from the Home Office for production of these products and legal advice is usually required to assist with the licensing process before production and marketing can take place.

Beyond this, non-THC CBD products tend to fall within one of the following three classifications:

Medicines
Food and novel foods
Cosmetics

Medicines

The use of CBD for medicinal purposes is arguably the most commonly accepted use of this type of product. Any CBD product which is marketed for medicinal purposes would fall under the definition of a medicinal product under the Human Medicines Regulations 2012.

This requires that marketing authorisation is put in place by the Medicines and Healthcare Products Regulatory Agency (“MHRA”) prior to being placed on the market. The sale, supply or advertising of a medicinal product without this authorisation is an offence under the Regulations. This applies to all forms of advertising, whether online, in print or in broadcast form.

Food

Specific health claims made in the marketing of foods can only be made if they satisfy the requirements set out in relation to that claim as recorded in the EU Register of specific health claims. Any general health claims relating to food must be accompanied by a relevant specific health claim.

In addition, advertising of food products must comply with the requirements of the UK Code of Non-broadcast Advertising and Direct & Promotional Marketing (the “CAP Code”). This sets out a number of requirements to ensure that advertising of food products does not undermine progress towards national dietary improvement by misleading or confusing consumers.

Novel foods are subject to more stringent requirements. These are food products which were either not consumed, or are now produced by a method not used for food production, prior to 1997.

While hemp products such as cold-pressed oils, hemp seed and flour (with no cannabinoids added) have a history of use in food products, CBD is extracted in such a way that it has officially been classified as a novel food by the EU Commission. This means that CBD products require authorisation from the European Commission before they can be marketed. Products on the market prior to the classification of CBD as a novel food require to achieve authorisation by March 2021 or risk removal from the market.

Post-Brexit, these requirements will remain in place and authorisations will be carried out through a similar process by Food Standards Scotland and the UK Food Standards Agency. Once approved, the product may be branded in a variety of different ways, provided it complies with the specification included in the original application, and the authorisation will apply to the product rather than the applicant, allowing the same product to be marketed by different distributors and retailers.

However, where one business buys CBD products from others, they must ensure these products are correctly authorised, and that they only use them in ways described in the authorisation, including for sales and marketing purposes.

Cosmetics

The extent to which cosmetic products using CBD may be marketed in the UK depends on the formulation used. While the flowering or fruiting tops of the cannabis plant are prohibited in cosmetics, use of the seeds and leaves of the plant is permitted.

Cosmetics marketed in the UK must also be subject to a safety report made to an authorised assessor prior to marketing, and manufacturers must notify the European Commission directly of every cosmetic product placed on the market. Breaches of these requirements is a criminal offence which can result in fines or imprisonment.

The general rules on advertising apply regardless of the type of product being marketed. Advertising must be legal, decent, honest and truthful, and should be prepared with a sense of responsibility to consumers and to society.

The CBD market is doubtless a lucrative opportunity for manufacturers and investors alike. The regulatory landscape, while complex, is not insurmountable. Our advertising and products teams are on hand to provide expert advice on the best route to getting your product to market.

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