Plan for over-the-counter CBD in Australia carries heavy restrictions

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Australia’s Ministry of Health has handed down an interim decision that could lead to over-the-counter (OTC) sales of CBD, but such products would face many of the same hurdles and regulations that govern approval of prescription pharmaceuticals. The rules from the Ministry’s Therapeutic Goods Administration (TGA) would also disallow smokable hemp, vape products and topical applications, cutting out three of the most dynamic CBD sub-sectors.

Both natural, plant-derived CBD as well as synthetic variations would be allowed under the rules, but synthetic products would be required to follow even more rigid protocols.

Not all upbeat

While the move, announced last week, was cheered by cannabis companies listed on the Australian Securities Exchange – most of which got a temporary bump in share prices on the announcement – not all were upbeat.

“The most critical point is that the clinical asset must have gone through the same hurdles and meet the same regulations as any other prescription pharmaceutical,” said Icannex Healthcare Chief Medical Officer Sud Agarwal.

“The recent changes by TGA regarding CBD certification and downscheduling opens the door to sophisticated and GMP CBD producers to access Australian customers via pharmacies without prescription for the first time,” said Boaz Wachtel, a director, co-founder and former chairman at Australian nutraceuticals maker Creso Pharma. “In that context and on a global scale, the Australian plan based on scientific evidence is welcome and an important development for the CBD industry.”

Broader context

Wachtel said the changes in Australia are critical in the context of a decision expected by the European Commission that could result in discrimination against the hemp and CBD industries, denying European consumers of the health benefits in nutraceuticals and other forms of delivery.

But Wachtel agreed the interim decision in Australia implies overly strict rules. “We think CBD classification should be similar to the UK regulatory model, which recognizes CBD as a non-narcotic natural extract and provides full access to consumers without unneccesary bureaucratic and regulatory intervention,” he said.

Creso and other stocks which saw temporary gains on the announcement included Bod Australia, Elixinol Global, Althea Group, THC Global, Cann Group, Medlab Clinical, Zelira Therapeutics, IDT Australia and Little Green Pharma.


Under the TGA decision, CBD would be switched from a Schedule 4 to a Schedule 3 substance, giving it clearance as a therapeutic in a range of oral forms. But Schedule 3 designation means the products must be kept behind the counter in pharmacies, and will not be available off-the-shelf.

Only products that contain 98% CBD would qualify under the rules, with other cannabinoid content capped at 2%. Sales would be limited to those 18 or older in a maximum daily dose of 60 mg. which must come in child-resistant packaging. Purchases would be limited to a maximum 30-day supply.

CBD products also would have to be approved for the Australian Register of Therapeutic Goods (ARTG). Standards under ARTG require that the drug’s final formulation be manufactured with “minimal batch-to-batch variability,” and that non-active ingredients are proven to be safe from adverse effects when administered at much higher than recommended doses. Products must be tested in rigorous double-blind, randomized, controlled clinical trials that show statistically significant results supporting any therapeutic claims. Advertising of the CBD would not be allowed.

‘Significant shift’

Despite the tight restrictions, “the interim decision reflects the significant shift in community and government attitudes towards medicinal cannabis since it was legalized in Australia in late 2016,” said Althea Group Chief Executive Officer Josh Fegan, who called the interim decision “one of the biggest developments in the medical cannabis industry to date.”

More than 60,000 patients in Australia have been prescribed cannabis via a Special Access Scheme or an Authorised Prescriber, giving at least one indicator of potential CBD market in the country, estimated to be worth upwards of $145 million.

The proposed implementation date for the downscheduling is June 1, 2021. Comments on the interim decision can be submitted until Oct. 13, and a final decision on the rescheduling is set for Nov. 25.

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