The U.S. Drug Enforcement Agency (“DEA”) identified this week that it considers certain types of novel cannabinoids to be federally illegal schedule I substances, even if they were derived from hemp.
As many are aware, the legality of hemp-derived products often spurs more questions than answers. Moreover, intoxicating cannabinoids are not alone in that regard, as the U.S. Food & Drug Administration (“FDA”) just recently concluded that existing regulatory frameworks for foods and supplements are not appropriate for cannabidiol (CBD), and urging Congress to develop the appropriate path forward. While some have interpreted this ambiguity as a free for all for hemp-derived cannabinoids, the U.S. Drug Enforcement Agency (“DEA”) recently weighed in as of February 13, 2023 – at least with respect to two such cannabinoids – that cannabinoids derived from hemp are still considered Schedule I controlled substances where: (1) they are not naturally occurring in the cannabis plant and can only be obtained synthetically; and (2) where they have similar chemical structures and pharmacological activities as tetrahydrocannabinols.
But what is the context and which intoxicating cannabinoids were at issue?
The context stemmed from an e-mail inquiry requesting clarification of the control status under the Controlled Substances Act (“CSA”) of THC acetate ester (“THCO”). As most are well-aware, the CSA places all substances which are, in some manner, regulated under existing federal law into one of five schedules. “Marijuana” remains a Schedule I substance under the CSA, meaning that it has a high potential for abuse, no currently accepted medical use in treatment in the United States, and a lack of accepted safety for use under medical supervision. However, the 2018 Farm Bill expressly excluded “Hemp” from the definition of “Marijuana” under the CSA, as well as the “Hemp” plants’ “derivatives, extracts, cannabinoids, isomers, acids, salts, and salts of isomers, whether growing or not, with a delta-9 tetrahydrocannabinol concentration of not more than 0.3 percent on a dry weight basis.”
But what is or is not a derivative, extract, or cannabinoid of “Hemp” has left businesses, regulators, and law enforcement scrambling for a uniform definition of what is and is not legal under the CSA. For instance, if a business takes a “Hemp” plant that that had a Delta-9 THC concentration of not more than 0.3% on a dry weight basis, and then extracts cannabinoids and chemically synthesizes it into an intoxicating cannabinoid with effects of THC higher than 0.3 percent, is that product/extraction legal because the “Hemp” plant was the source? Many have certainly taken that position, which has led to a host of different hemp-derived intoxicating cannabinoid products, i.e., Delta-8, Delta-10, and THCO, being readily available for sale in both online and brick-and-mortar retail locations, including in states and municipalities where cannabis sales are expressly banned.
The DEA answered at least part of these questions in its letter dated February 13, 2023. So what did it say? After addressing some of the points above related to the CSA and 2018 Farm Bill, the DEA focused on the definition of “tetrahydrocannabinols” under the CSA, noting that the term was defined to mean those “naturally contained in a plant of the genus Cannabis (cannabis plants) as well as synthetic equivalents of the substances contained in the cannabis plant and/or synthetic substances, derivatives, and their isomers with similar chemical structures and pharmacological activity to those substances contained in the plant.” Thus, notwithstanding the fact that THCO may been created using an extract or derivative of hemp, it still remains a CSA Schedule I substance because: (1) THCO is not naturally occurring in the cannabis plant and can only be obtained synthetically; and (2) THCO has similar chemical structures and pharmacological activities as tetrahydrocannbinols. While many have cautioned that this guidance from the DEA is only limited to THCO, it nevertheless provides a framework for how the DEA -the agency with primary authority for combatting drug trafficking and distribution – analyzes the applicability of the CSA to hemp-derived intoxicating cannabinoids.
But Don’t Forget the States!
While this DEA letter is certainly important for businesses assessing lawful and unlawful conduct, it is also important to remember that there is an ever-increasing number of states regulating hemp-derived intoxicating cannabinoids. For instance, Colorado and New York have banned hemp-derived delta-8 products. Other states, such as Minnesota, have legalized food and beverages containing up to 5 milligrams of hemp-derived THC per serving. Even others still identify that while intoxicating cannabinoids may be sold, they can only be sold at a licensed cannabis dispensary. And the trend of states stepping into the perceived gap in regulatory coverage only increases, with legislators in New Jersey recently introducing legislation to regulate it, with the lead sponsor referring to hemp derived intoxicating cannabinoids as “the bathtub gin of the cannabis space.”
In short, notwithstanding the perceived clarity from the DEA, the regulatory landscape remains complicated and nuanced, to say the least.