Alert September 18, 2019

FTC Warns CBD Companies to Substantiate Their Advertising

Summary

Health claims about cannabidiol (CBD) products are facing new scrutiny from yet another federal government enforcer. Earlier this month, the Federal Trade Commission (FTC) announced it sent warning letters to three undisclosed CBD companies. Though the FTC did not release the names of the companies receiving the warning letters, the warnings were stiff, reminding these entities that advertising CBD products can prevent, treat, or cure human disease, without competent and reliable scientific evidence to support such claims, is illegal.

In the letters, the FTC also encouraged these companies to review all their advertising claims and customer testimonials to ensure they are supported by competent and reliable scientific evidence; reminded them that unsubstantiated health claims could violate the FTC Act; and instructed each to notify the FTC of the specific actions they have taken to address the FTC’s concerns.

This latest round of letters follows similar warning letters from the FTC and U.S. Food and Drug Administration earlier this year. Both signal enhanced legal exposure for CBD companies. This time, however, the FTC acted independently, which amounts to a declaration that the agency views itself as having an important and differentiated law enforcement role, and one they fully intend to assert.

The FTC Act Requires Substantiation

Under the FTC Act, it is unlawful to advertise that a product can prevent, treat, or cure human disease unless the advertiser possesses competent and reliable scientific evidence substantiating that the claims are true at the time they are made. The FTC’s recent letters to CBD companies called out the following examples of claims that require substantiation:

  • “CBD ‘works like magic’ to relieve ‘even the most agonizing pain’ better than prescription opioid painkillers.”
  • “CBD has been ‘clinically proven’ to treat cancer, Alzheimer’s disease, multiple sclerosis (MS), fibromyalgia, cigarette addiction, and colitis, the company states it has participated in ‘thousands of hours of research’ with Harvard researchers.”
  • “CBD products are proven to treat autism, anorexia, bipolar disorder, post-traumatic stress disorder, schizophrenia, anxiety, depression, Alzheimer’s disease, Lou Gehrig’s Disease (ALS), stroke, Parkinson’s disease, epilepsy, traumatic brain injuries, diabetes, Crohn’s disease, psoriasis, MS, fibromyalgia, cancer, and AIDS.”
  • “CBD gummies [are] highly effective at treating ‘the root cause of most major degenerative diseases, including arthritis, heart disease, fibromyalgia, cancer, asthma, and a wide spectrum of autoimmune disorders.’”

Key Takeaways

  • CBD health-related claims require substantiation. Advertising that CBD products can prevent, treat, or cure human disease requires competent and reliable scientific evidence to support such claims. 
  • Clients must now seek FTC counsel, in addition to FDA counsel, to assure their claims are substantiated as required by the FTC’s consumer protection laws.
  •  The FTC is signaling that it is willing to act independently and enforce the consumer protection laws governing health-related advertising..