Q&A: Talking Innovation with the Association for the Cannabinoid Industry

The Association for the Cannabinoid Industry was launched at the end of October, providing a platform to aid the development of a legally compliant, socially responsible and innovative CBD industry. With the CBD market poised for further growth, ​​​​​​​Abi Millar sits down with the new trade group for a broad discussion about the future of this exciting but complex market.

The UK’s cannabidiol (CBD) market has exploded over the past few years, and shows no signs of slowing down. One of the main constituents of the cannabis sativa plant, CBD is sold in a wide range of forms, from sprays and gummies to CBD-infused hair treatments. Since it is mostly sold as a food supplement, not a medicine, manufacturers aren’t allowed to make health claims. That hasn’t deterred consumers, many of whom are using the products for therapeutic purposes.

However, confusion reigns over its legal status, and quality control is all but non-existent. In November, the Centre for Medicinal Cannabis (CMC) launched the Association for the Cannabinoid Industry (ACI), with a view to addressing poor practice throughout the industry. CMC/ACI development director Shomi Malik explains why there is such a pressing need for an organisation of this kind.

Image courtesy of Shomi Malik

Abi Millar: The ACI is a new trade organisation for the UK’s CBD industry, spun out from the CMC. Can you run me through how you got started?

Shomi Malik: Before the CMC, there was a recreational policy advocacy group called the VolteFace, led by Steve Moore, who is a prominent lobbyist. During the Billy Caldwell case [in which a severely epileptic boy struggled to obtain medical cannabis], Moore ran a strategic campaign on behalf of the Caldwell family. This basically got the law changed on medicinal cannabis.

Back then, in 2018, it looked like the UK was opening up for medicinal cannabis. In hindsight we know that’s not true, but at the time there was a lot of excitement. Global cannabis companies approached us and asked if we could help them navigate the UK’s regulatory landscape, so that’s how the CMC was born.

While there really is no medicinal cannabis market in the UK, there has been an explosive growth in the CBD wellness sector. A lot of these companies also have interests in CBD, so they asked us to take a closer look at what that meant. Since there was no proper data, we commissioned a market sizing exercise and a YouGov report to establish public attitudes to CBD. We also did a product testing exercise, in which we tested 30 products off the high street and online. And that was how the ACI was born.

What are some of the main challenges confronting the UK’s CBD market at the moment? And why do so many consumers (48%, according to the YouGov study) lack confidence in the market?

The findings of our product testing exercise did not make for pretty reading. Two thirds of the products we tested had some issue, like being significantly under-strength or nowhere near the advertised content. One of them had non-compliant levels of dichloromethane. One product, a £90 product found across the second largest chain in the country, contained 0% CBD.

The lack of clarity means a burgeoning cottage industry, and that basically means you’ve got bad actors in the space who are very happy with the lack of clarity and regulation. Consumer rights are an afterthought.

One of our recommendations is that the industry needs a kitemark to get behind. You see the Soil Association kitemark and know a product is organic, but if you didn’t would you then have to certify it yourself? It’s untenable. The CBD industry needs something similar, run by experts and professionals who’ve been in the industry a long time. We think we’ve got those credentials.

What are some of the regulatory complexities surrounding CBD?

In January 2019, the European Commission reclassified CBD products as a Novel Food. This is up to each member state to enforce, and we’ve been in discussions with the UK Food Standards Agency (FSA) to discuss how we can achieve compliance on behalf of our members.

The issue is that if a company doesn’t have a Novel Foods designation, technically they’re unauthorised. Are they just going to clear the market and wait for companies to get up to speed with Novel Foods, which could take two to three years? The FSA is just about to issue guidance instructions on enforcement, and we’ve seen a couple of cases of enforcement already, so it’s slowly happening.

We as a group are pretty ambivalent about regulation – we just want the industry to be compliant with whatever regulations there are, because that foments trust. And a lot of the issues our report showed – like no CBD in certain products, contaminants etc – are much less likely in a more tightly regulated environment.

The National Pharmacy Association (NPA) put out a statement late last year looking for clearer guidance on enforcement, and we absolutely welcome that. It’s good that other organisations are seeing the pitfalls of wantonly selling CBD products without knowing what’s in them.

For now, anything you find in Holland and Barrett that’s sold as a food supplement is unauthorised. This causes us huge problems, because what you’re finding is the best quality products aren’t making it onto the shelves in the UK, while companies with no desire to be compliant are running the industry. That puts a ceiling on what the industry can achieve, and is also part of why we decided to create the ACI.

The ACI hopes to spur the development of a legal, safe and well-regulated industry in the UK. How do you plan on achieving these goals?

Nobody’s got a successful market authorisation under Novel Foods yet, so it’s a bit of an unknown. With most Novel Foods, there is the necessary safety data in public literature; you just have to collate it and put it in a format the regulators will understand. We don’t have that for CBD. We need toxicity studies, genotoxicity studies, potential animal studies further down the line. We see that as an opportunity, because you get to be the first group of companies to generate safety data in a robust environment and categorically allay any concerns.

We want to win the trust of the regulators. If the regulators trust our vision, we can then go to our members and say, this is our vision that’s been ratified by the powers that be. We believe by investing in safety studies, and addressing the lack of standardisation in testing methods, this will lead to our members producing better quality products more consistently.

ACI members will need to adhere to your new Quality Charter. What are the most important elements of this charter?

First and foremost, to be a member of the ACI and qualify for the kitemark you have to be legal. I know it sounds elementary but there are some companies that seem to think because they’ve been doing it for a while the rules don’t apply to them. So pillar number one is the legal framework.

I think the second pillar is the most fundamental issue the entire industry faces, which is analytical testing. Right now there are no standardised methodologies for testing – it differs from lab to lab and the analytical space is littered with bad actors. So how can consumers have any trust in the results when they might not be worthy of the paper they’re written on?

There’s another big issue, which is the controlled drugs limits. If the legislation in a particular market doesn’t allow for any THC in a product, that has the potential to become a big issue in regard to narcotics trafficking. We’re working with the Home Office and other regulatory stakeholders to come up with a proposal for a standardised testing methodology. I think the work we’re doing here is world-class.

The third pillar is labelling. I picked up a bottle of CBD a couple of months ago which was labelled as a 10% bottle, but then the small print said ‘10% of a 15% extract’. There needs to be clear concise labelling about what the product contains, which is a simple part of getting trust back into the industry.

The fourth pillar is manufacturing – CBD is a very special compound when it comes to manufacturing and requires specific skill sets. Pillar number five is to meet the statutory requirement not to sell controlled substances. Pillar number six is marketing ethics, and pillar number seven is to build sustainability into our core. We’re in our nascence as an industry and we’ve got a real opportunity to set an example to other industries on what sustainability looks like.

What are the benefits of membership, from your members’ perspective?

They’re associated with the only organisation that has this constructive line of dialogue across all the regulatory stakeholders. If you’re with the group that were instrumental in getting the law changed on medicinal cannabis, it’s very good for optics. We give advice on how to enter the market in a safe legal way, as well as access to the regulators. It’s also a question of power and safety in numbers.

How do you intend to shape the conversation around CBD versus medicinal cannabis?

People come with these misconceptions that are broken down quite easily if they’re framed right. One way you can normalise the conversation is to move it away from cannabis culture and more into a professional supplements space.

On the other hand, I think there’s a danger in separating CBD from medicinal cannabis, as the whole plant should be respected. It just needs to be done right, and the industry needs to invest the necessary resources in safety and research. We just did a study to see how many patients in the UK are turning to the black market, and we found that more than a million people are using cannabis illegally to self-medicate.

So you can either be the cannabis activist talking about cannabis, or you can talk about CBD and separate out the different compounds. We need to work out how to bring that to the market, since the outputs are ostensibly the same but they’re two very different tones.

How have the first few months gone, and what does the rest of 2020 hold?

It’s been a really exciting start to the year. The goal for Q1 is to focus on novel foods – that’s a very short-term goal, but very necessary if the whole market is illegal. If a £300m market has emerged out of nowhere, think what it could be if there was the right stewardship at the top. We aim to launch the kitemark in the spring, which we hope will bring the trust back into the industry.

Over the longer term, our goal is to be the best, most innovative CBD market in the world.

Everything we do has the consumer front and centre, but that doesn’t mean just acquiescing to what they want – there needs to be a level of education on why it should take a bit of time to do the necessary safety studies. If we do this right, this could be the minimum viable product for the entire responsible cannabis sector, so there’s a lot at stake.

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