Did Your Hemp Extract Just Become Illegal?

Late last week, the U.S. Drug Enforcement Agency (DEA) released their Interim Final Ruling on hemp extract that, if passed in October, will have devastating consequences for the CBD industry.

In typical government fashion, the DEA misinterpreted what was stated in the Farm Bill and ran with it, creating a new roadblock for the cannabis industry that makes no sense whatsoever. In short, the DEA ruling prohibits any hemp extract that reach 0.3% or more tetrahydrocannabinol (THC) at any point during the manufacturing process, by categorizing these products as Schedule 1 Narcotics. Did all hemp extract just become illegal?

At first glance, the law makes sense based on the 0.3% cutoff that, arbitrary as it may be, has been around for quite some time. However, this law doesn’t apply to just finished products. If we have a CBD oil for example, that has no THC in the final product and was extracted from legally compliant industrial hemp, it could still be illegal if at some point during the manufacturing process, the THC (temporarily) exceeded 0.3 percent.

Now it makes even less sense, doesn’t it? Well, it doesn’t get much better.

WIPHE and Temporarily Elevated Levels of THC

When creating CBD products, even isolate, they go through a stage referred to as Work-in-Progress Hemp Extract (WIPHE), during which the concentrations of THC temporarily exceed 0.3 percent. Products in the WIPHE stage are only partially processed, and not intended for sale or consumption. Fluctuating levels of cannabinoids is just a normal part of the process and is impossible to avoid. Even during at the most basic levels of production, there will always be a point where the product has more than 0.3% THC.

It is these WIPHE products that are now banned. So, in the process of creating legal products from a legal plant, they briefly enter a stage where they are considered a Schedule 1 controlled substances, and thus are overall illegal. It was always the elephant in the room, but it’s honestly illogical to think that any of that matters, the focus should obviously be on the finished product that ends up in the consumer’s hands.

Dry hemp vs wet hemp

There is quite a bit of confusion whether this applies to products in the WIPHE stage or only completely finished, consumer products. According to the National Hemp Association, “this IFR only refers to consumer products to ensure that they are D9 compliant. It does not address mid-process crude or distillate which often exceeds legal THC levels. So moving/selling those materials across state lines remains ambiguous and problematic. However, while this IFR does not alleviate that concerns it also does not make it worse.”

However, lawyers from CannaBusiness Law Group say otherwise. I would like to reference the dry vs. wet hemp issue that means, this DEA IFR likely refers to crude, in-process products as well, which would make all hemp extract illegal.

“It is clear that a hemp plant (or part of a plant) with THC levels that do not exceed the statutory 0.3% concentration limit on a dry weight basis is lawful. That plant (or part of the plant) can be chopped, ground, plucked, and otherwise processed dry and remain lawful. This is because the statutory definition directly addresses hemp on a dry weight basis. The issue addressed in this letter arises when hemp is processed for its oil, which necessarily renders the hemp plant and its parts “wet”. The statute does not contemplate measuring THC levels of a wet extract. For this reason, in determining whether it is lawful to transport WIPHE we must focus both on both the language and Farm Bill’s apparent intent.”

What does this mean and what can we do?

Honestly, it’s hard to say what it all means. If it holds up in a court of law, which I personally don’t think it will, it would be a complete and utter disaster for the CBD industry. Would all CBD products be banned? What would happen to FDA-approved drugs like Epidiolex, which use CBD in their formulations?

There are a lot of unanswered questions at the moment, but the good news is, this ruling isn’t set in stone and we have until October 20, 2020 to voice our opinions. Just CLICK HERE and following the online instructions at that site for submitting comments. To ensure proper handling of comments, you should reference “RIN 1117- AB53/ Docket No. DEA-500” on all correspondence.

In addition to potentialy making hemp extract illegal, Delta-8 products have been banned as well, and that has been challenged in court by numerous hemp companies. If you own a hemp company that will be affected by this ruling, talking to a lawyer about your options might be your best bet. CBD Flower