Misstep on Regulations Leaves Some Stores Reluctant to Sell CBD Drinks

New York deli Westside Market carries Vybes drinks, but larger chains like Target and Walmart are wary of selling CBD products due to regulatory inconsistencies.

Hundreds of CBD-infused food and beverage products have come on the market in recent years, but you won't find many of them on supermarket shelves.

CVS Pharmacy, for example, started carrying a selection of CBD-based creams, lotions, and oils in eight states last year. But the pharmacy giant has kept its CBD offerings limited, and no national supermarkets have followed suit, according to Lawrence Steinberg, a company spokesman.

One major obstacle is the lack of clear guidance from the U.S. Food and Drug Administration, which says it is still formulating regulations for CBD products. These products are often marketed as supplements, but the F.D.A. has not concluded that they are safe and effective for their intended uses.

That has left consumers exposed to products of uneven quality that cannot necessarily deliver on their promises, like pain relief or better sleep. And it has left retailers wary of stocking products that might land them in legal jeopardy.

"It's not clear what standards or regulations these products should meet," said Scott Allshouse, a spokesman for the National Grocers Association, which represents independent grocery stores. "So it's understandable that many in the supply chain, not just retailers, are proceeding with caution."

Even in places where the products are clearly legal, supermarkets are unsure whether they want to be among the first to stock CBD food and beverages, said Jeff Gray, a partner at the law firm Fisher Phillips who specializes in marijuana regulations.

"They don't want to be the guinea pig," he said. "And if it does turn out that there is some violation of federal law, they want to be able to say, 'Well, we looked into it, and we decided we couldn't take the risk.'"

That hesitation, which is particularly pronounced among large supermarket chains, has created something of a stigma for CBD products, said John Kagia, chief knowledge officer at the cannabis market research firm New Frontier Data.

"The biggest supermarkets are relying on the advice of their lawyers, who are telling them to wait for more regulatory clarity," he said. "And while that's prudent, it also means that a whole population of consumers are unable to find the products that they are looking for in the places that they normally shop."

For now, small businesses like Westside Market, a deli in the Chelsea neighborhood of Manhattan, step into the void.

Just below rows of energy drinks and kombucha beverages sit a few glass bottles of Vybes, a CBD-infused drink with slogans like "Calm Your Farm" and "Boost Your Vibes." The drinks, which come in flavors like strawberry lavender and blood orange lime, are made with cannabidiol, or CBD, one of many chemical compounds found in cannabis plants.

Vybes' founder, Jonathan Eppers, said he had no problem getting his product on the shelves of Westside Market and about a dozen other small businesses in New York City and Los Angeles. But he said he had encountered resistance when trying to get his drinks into larger chains, such as Target and Walmart.

"When I first started, I thought Target would be a dream retail partner, and they outright told me that they wouldn't be able to sell it," he said.

A Walmart spokesman declined to comment on why the company does not carry CBD products.

Target spokesman Eric Schmit said the company was watching the FDA's actions as the agency develops guidance for cannabis-derived products and said that Target would "continue to assess our approach."

For now, Mr. Schmit said, Target has focused on CBD products that are designed for topical use, like roll-on pain balms, and has not offered any CBD-infused food or beverages.

The regulatory landscape is likely to remain complicated for some time.

The 2018 Farm Bill, which legalized hemp, a type of cannabis plant that is rich in CBD, on a federal level, also explicitly preserved the F.D.A.'s authority over products that fall under its jurisdiction.

The F.D.A. has acknowledged the potential therapeutic benefits of CBD, but the agency has also raised concerns about the compound's potential for harm and the risk that it could be abused.

Last year, the F.D.A. said that it had sent warning letters to some companies making extraordinary claims about their CBD products' therapeutic effects and warned that it would take action against companies that continued to sell products with "egregious violations."

Last month, the F.D.A. announced the formation of a working group to consider how the agency might regulate CBD products to protect public health.

"We're working quickly to address the many questions people have about CBD and hashish," the F.D.A. said in a statement on Twitter after the announcement.

But for now, the agency has repeatedly said that companies cannot add CBD to food or market it as a dietary supplement.

That ambiguity has done little to quell demand, however, and there is a huge and growing market for CBD products in the United States.

Sales of hemp-derived CBD products reached $730 million in 2018, according to New Frontier Data, and are on track to surpass $23 billion by 2025.

For now, small business owners like Brian Galkov, the owner of Westside Market, are willing to take their chances selling CBD beverages like Vybes.

"It's a great product, and I think that someday soon, more places will carry it," he said. "So we're happy to be one of the first."

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