On November 25, the U.S. Food and Drug Administration (FDA) has issued () warning letters to 15 companies selling products containing Cannabidiol (CBD), giving them 15 working days, till December 13, to put their product marketing in compliance with the Federal Food, Drug, and Cosmetic Act.

FDA Principal Deputy Commissioner Amy Abernethy explained in the press release that the governmental agency in concerned “that some people wrongly think that the myriad of CBD products on the market, many of which are illegal, have been evaluated by the FDA and determined to be safe, or that trying CBD ‘can’t hurt”. 

The government agency insists that some products are marketed “with unproved medical claims” or are labeled as diet supplements, however they fail to meet the category definition.

The affected companies include Koi CBD LLC, Pink Collections Inc., Noli Oil, Natural Native LLC, Whole Leaf Organics LLC, Infinite Product Company LLLP, Apex Hemp Oil LLC, Bella Rose Labs, Sunflora Inc., Healthy Hemp Strategies LLC, Organic Industries Inc., Private I Salon LLC, Organix Industries Inc., Red Pill Medical Inc., Sabai Ventures Ltd. and Daddy Burt LLC.

In parallel, FRA has published a Consumer Update, reminding the public that only one CBD product has received an official FDA approval to treat rare forms of epilepsy and stating the lack of research data –“there are many unanswered questions about the science, safety, and quality of products containing CBD”.

Among safety concerns, FDA lists liver injury, changes in metabolism, unregulated use with alcohol and other stimulants, changes in alertness, gastrointestinal distress, changes in mood.

For companies with key business units built around CBD products, such scrutiny could possess certain financial risks. For example, following the FDA press release, stocks of publicly-traded company Charlotte’s Web Holdings, Inc. (CWBHF) has experienced mostly gradual decrease in prices by more than 9%.