THE SENATE

S.B. NO.

2274

THIRTIETH LEGISLATURE, 2020

 

STATE OF HAWAII

 

 

 

 

 

 

A BILL FOR AN ACT

 

 

relating to health.

 

 

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

 


SECTION 1. The legislature finds that the use and sales of cannabidiol and cannabidiol products in the State has increased significantly in the last few years. While there may be some potential health benefits by using cannabidiol and cannabidiol products, the research is still being conducted and, as a result, there is widespread confusion and misunderstanding about the potential benefits and negative health risks of cannabidiol.

The legislature further finds that since 2015, the federal Food and Drug Administration has issued nearly fifty warning letters to firms marketing products that allegedly contain cannabidiol and found that many of the products did not contain the levels of cannabidiol they claimed to contain. Furthermore, the Food and Drug Administration warns consumers that cannabidiol products are not approved for the diagnosis, cure, mitigation, treatment, or prevention of any disease.

The legislature also finds that despite efforts to educate the public about the risks of cannabidiol and to prohibit and regulate cannabidiol as a food product, food additive, and cosmetic, it is being marketed as a "dietary supplement" in an effort to circumvent regulation.

The federal 2018 Farm Bill removed hemp from the Controlled Substances Act so that cannabis plants and derivatives that contain no more than 0.3 per cent of delta-9 tetrahydrocannabinol are no longer controlled substances under federal law. However, the law explicitly preserved the Food and Drug Administration's authority to regulate products containing cannabis or cannabis-derived compounds under the federal Food, Drug, and Cosmetic Act and section 351 of the Public Health Service Act. Additionally, the state department of health regulates all cannabis-derived products, regardless of whether they are derived from hemp, which is consistent with the Food and Drug Administration's approach.

The legislature further finds that the State's industrial hemp pilot program was enacted, in part, to allow the cultivation of industrial hemp for purposes of agricultural or academic research. However, licensees under the pilot program are currently unable to participate in the cannabidiol marketplace due to provisions that were adopted prior to the growth of cannabidiol in the consumer marketplace. In order to properly assess the viability of an industrial hemp industry in the State, licensees should be allowed to produce cannabidiol derived from their industrial hemp and legally have an avenue for the cannabidiol to make it to the consumer market.

The purpose of this Act is to:

(1) Expressly regulate cannabidiol under the department of health to be consistent with the Hawaii Food, Drug, and Cosmetic Act under chapter 328, Hawaii Revised Statutes, including mirroring certain provisions of the medical cannabis dispensary system under chapter 329D, Hawaii Revised Statutes; and

(2) Allow licensees under the industrial hemp pilot program to market their products to the consumer market in a manner that is regulated and tested for safety, purity, and potency.

SECTION 2. Chapter 328, Hawaii Revised Statutes, is amended by adding a new part to be appropriately designated and to read as follows:

"PART    . CANNABIDIOL PRODUCTS

328-   Objective. The purpose of this part is to establish the minimum laboratory testing and labeling requirements for cannabidiol products consistent with the 2018 Farm Bill, Public Law 115-334, which explicitly preserves the authority to regulate products containing cannabis or cannabis-derived compounds under the Federal Food, Drug, and Cosmetic Act and section 351 of the Public Health Service Act.

328-   Definitions. As used in this part, "cannabidiol", or "cannabidiol product" means any product derived from cannabis sativa that contains cannabidiol, including cannabidiol derived from hemp as defined in the 2018 Farm Bill, Public Law 115-334, with a delta-9 tetrahydrocannabinol, or "THC", concentration of not more than 0.3 per cent on a dry weight basis.

328-   Prohibitions. Unless approved by the department or sold with and through a physician or advanced practice registered nurse recommendation, cannabidiol shall not be:

(1) Manufactured, distributed, or sold as a food product or cosmetic;

(2) Added to food, beverages, or cosmetics;

(3) Marketed or sold as a dietary supplement; or

(4) Distributed or sold to any minor under the age of eighteen years old.

328-   Laboratory standards and testing. (a) Any cannabidiol product to be manufactured, distributed, or sold in the State shall be required to undergo laboratory testing by a laboratory that is certified by the department.

(b) The department shall establish and enforce standards for laboratory-based testing of cannabidiol and cannabidiol products for content, contamination, and consistency, including pesticides regulated by the United States Environmental Protection Agency, microbiological impurities, and heavy metals.

(c) Prior to the department adopting rules and regulations specifically for cannabidiol and cannabidiol products, all cannabidiol and cannabidiol products shall be tested in the same manner and under the same standards as required for medical cannabis under section 329D-8 and its regulatory counterparts under title 11, chapter 850, subchapter 7 of the Hawaii administrative rules, as amended.

328-   Marketing and labeling. (a) The department shall establish standards regarding the advertising and packaging of cannabidiol and cannabidiol products; provided that the standards, at a minimum, shall require the use of packaging that:

(1) Is child-resistant and opaque so that the product cannot be seen from outside the packaging;

(2) Uses only black lettering on a white background with no pictures or graphics;

(3) Is clearly labeled with the phrase "For medical use only";

(4) Is clearly labeled with the phrase "Not for resale or transfer to another person";

(5) Includes instructions for use and expiration date;

(6) Contains information about the contents and potency of the product;

(7) Includes the name and location by country, state, and city of the manufacturer where the cannabidiol or cannabidiol product was manufactured, including the date of packaging;

(8) Includes a listing of the equivalent physical weight of the cannabidiol used to manufacture the amount of the product that is within the packaging; and

(9) Includes a clear warning stating that the product:

(A) Is a medication that contains cannabidiol and is not a food, dietary supplement, or cosmetic; and

(B) Should be kept away from children."

SECTION 3. Section 141-36, Hawaii Revised Statutes, is amended to read as follows:

"141-36 Growing of industrial hemp; licensee responsibilities. The licensee shall:

(1) Assume a limited agency relationship with the board for the sole purpose of research of industrial hemp and its growth, cultivation, and marketability. The licensee shall conduct all agricultural operations in a lawful manner consistent with the standards befitting of an official of the State; provided that such standards are subject to the sole discretion and direction of the board;

(2) Abide by applicable laws and regulations incident to the growth, cultivation, or marketing of industrial hemp;

(3) Acknowledge that any action, intended or incidental, that is contrary to such laws and regulations, known or unknown, falls outside the agency relationship of the licensee with the board and the licensee's participation in the industrial hemp pilot program; provided that this paragraph applies to all actions incident to the licensed production of industrial hemp, including but not limited to any sale or disposition of the resulting plants, plant materials, or seeds for which the licensee may otherwise receive some benefit or consideration;

(4) Indemnify, hold harmless, and release forever the State and its departments, agencies, officers, employees, and agents of any kind from all liability claims arising out of the licensee's actions involving the growth, cultivation, or marketing of industrial hemp;

(5) Warrant that the licensee is not an employee of the State and shall assume total and sole responsibility for any of the licensee's acts or omissions involving the growth or production of industrial hemp or arising out of the licensee's participation in the industrial hemp pilot program;

(6) Allow any institution of higher education in the State to access those sites registered by the licensee with the board for production of industrial hemp; provided that such access shall be allowed upon notice from the board to the licensee and shall extend for all purposes determined at the discretion of the board related to research of industrial hemp and its growth, cultivation, and marketing;

(7) Upon request, allow federal, state, or local authorities to inspect and sample the industrial hemp growing area, plants, plant materials, seeds, equipment, or facilities incident to the growth or production of industrial hemp;

(8) Remit to the board all license fees and other expenses of the pilot program, including but not limited to all fees related to sampling and analysis of hemp plants and plant materials and destruction of resulting hemp crops found by the board to be noncompliant with applicable laws and regulations;

(9) Agree that with respect to the licensee's production of industrial hemp, the board's role is to fulfill regulatory oversight of the production and, where possible, to facilitate receipt of viable seed; provided that the licensee understands and agrees that the licensee shall not receive compensation or wages from the board and the board shall not offer financial resources, tangible products, or commercial labor in support of the licensee's industrial hemp crop;

(10) Adhere narrowly to the research focus for which the licensee is participating in the industrial hemp pilot program, if applicable, to include one or more of the following:

(A) Planting and growing--tracking vital statistics and yield rates with respect to industrial hemp varieties and growing variables, including seed planting rate, soil composition, water usage, and planting and growing season;

(B) Pest--tracking the occurrence of pests and effectiveness of various preventative measures in correlation with industrial hemp varieties;

(C) Cost centers and financing--tracking average cost estimates of producing industrial hemp varieties, taking into account costs of participation in the industrial hemp pilot program, product acquisition, water usage, equipment, labor, and security measures and reporting financial resources available for production of industrial hemp; or

(D) Marketing and industry development--reporting market demand for industrial hemp varieties' raw materials and end products, including identification of actual or potential hemp products, including, but not limited to cannabidiol and cannabidiol products as defined and authorized by the 2018 Farm Bill, Public Law 115-334; processors[,]; product manufacturers[,]; wholesalers[,]; retailers[,]; and targeted consumers;

(11) Complete and submit all reports and statements requested by the board relative to the licensee's production of industrial hemp; provided that a failure to submit any required or requested report may result in revocation of the licensee's industrial hemp license;

(12) Understand and agree that any industrial hemp grown in Hawaii without an active industrial hemp license issued by the board falls outside the licensee's limited agency with the board, is considered to be marijuana under state law, and constitutes impermissible growth of industrial hemp under federal law; provided that the licensee shall understand that such action will be prosecuted in accordance with all applicable laws;

(13) At the discretion of the board, destroy or dispose of any industrial hemp crop, plant, plant material, or seed determined by the board or law enforcement to be noncompliant with applicable laws or regulations;

(14) Use best management practices for growth and production of industrial hemp, as available, and take reasonable precaution to prevent unauthorized growth or distribution of industrial hemp, including but not limited to:

(A) Keeping records of all persons with access to the growing area or hemp plants, plant materials, or seeds;

(B) Installing reasonable security measures to prevent theft and posting signs indicating that cameras are used to record activity on the growing area property;

(C) Inspecting and recording regularly the condition of the growing area, facilities, and equipment used in the production of industrial hemp;

(D) Conducting regular inventory counts of hemp plants, plant materials, and seeds in order to recognize more quickly if a theft has occurred;

(E) Contacting local law enforcement to help identify additional security measures and encourage patrols near the growing area;

(F) Reporting to local law enforcement any suspicious activity and the presence of strangers near the growing area or facility;

(G) Reporting stolen, lost, or missing hemp plants, plant materials, or seeds to the board and law enforcement authorities as soon as the items are noticed to be missing; and

(H) Reducing the likelihood of cross pollination between varieties of industrial hemp and among other plants by:

(i) Separating any growing area from other self-pollinating plants by more than ten feet; and

(ii) Separating any growing area from other wind and insect pollinating plants by more than three hundred feet; and

(15) Comply with any direction of the chairperson with respect to the growth, cultivation, or marketing of industrial hemp not otherwise contemplated in this section."

SECTION 4. Section 141-38, Hawaii Revised Statutes, is amended to read as follows:

"[[]141-38[]] Violations. In addition to any other violations of this part, the following acts and omissions by any licensee or authorized representative thereof constitute violations for which civil penalties up to $500 and disciplinary sanctions, including revocation of a license, may be imposed by the chairperson:

(1) Refusal or failure by a licensee or authorized representative to fully cooperate and assist the board with the inspection process;

(2) Failure to provide any information required or requested by the board for purposes pursuant to this part;

(3) Providing false, misleading, or incorrect information pertaining to the licensee's cultivation of industrial hemp to the chairperson by any means, including but not limited to information provided in any application form, report, record, or inspection required or maintained pursuant to this part;

(4) Growing industrial hemp that when tested is shown to have a delta-9 tetrahydrocannabinol concentration greater than 0.3 per cent on a dry weight basis or a tetrahydrocannabinol concentration allowed by federal law, whichever is greater;

(5) Failure to pay fees assessed by the chairperson for inspection or laboratory analysis costs; or

(6) Possessing, outside of a field of lawful cultivation, resin, flowering tops, or leaves that have been removed from the hemp plant; provided that [the]:

(A) The presence of a de minimis amount, or insignificant number, of hemp leaves or flowering tops in hemp bales that result from the normal and appropriate processing of industrial hemp; and

(B) Possession and transport of resin and flowering tops to a licensed medical cannabis dispensary production center's approved manufacturing facility,

shall not apply to this paragraph."

SECTION 5. Section 329D-9, Hawaii Revised Statutes, is amended to read as follows:

"[[]329D-9[]] Manufacturing of medical cannabis products. (a) Any medical cannabis dispensary licensed by the department pursuant to this chapter shall be permitted to manufacture cannabis products; provided that the dispensary shall also obtain any other state or county permits or licenses that may be necessary for a particular manufacturing activity.

(b) The department shall establish health, safety, and sanitation standards regarding the manufacture of manufactured cannabis products.

(c) A manufacturer of a manufactured cannabis product shall calculate the equivalent physical weight of the cannabis that is used to manufacture the product and shall make the equivalency calculations available to the department and to a consumer of the manufactured cannabis product.

(d) A facility that has been approved by the department under this section shall be authorized to use cannabidiol and cannabidiol products in their manufactured cannabis products when the cannabidiol or cannabidiol product is derived from a licensed industrial hemp producer under chapter 141."

SECTION 6. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.

SECTION 7. This Act shall take effect on July 1, 2020.

 

INTRODUCED BY:

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Report Title:

Cannabidiol; Department of Health; Laboratory Standards and Testing; Marketing and Labeling

 

Description:

Regulates cannabidiol under the department of health to be consistent with the Hawaii Food, Drug, and Cosmetic Act. Allows licensees under the industrial hemp pilot program to market their products to the consumer market in a manner that is regulated and tested for safety, purity, and potency.

 

 

 

The summary description of legislation appearing on this page is for informational purposes only and is not legislation or evidence of legislative intent.