CBD Retailers Hope Farm Bill Clears Up Legal Issue 12/26/18 12/26/18 11:11:38 AM
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Gollobit, left, and Paul Gollobit stand behind the sales counter at American Shaman, 1517 Farnam St. American Shaman has been selling hemp oil products since October. (Photo by Scott Stewart)
CBD Retailers Hope Farm Bill Clears Up Legal Issue
By Scott Stewart
The Daily Record
Products derived from the family
of plants used to manufacture marijuana have been openly sold in Omaha, despite legal warnings
from the Nebraska Attorney General’s Office, but may soon have their legal status clarified as part of the federal farm bill.
The farm bill, passed recently by Congress, would legalize the cultivation of industrial hemp – a variety of cannabis plants that produces strong fibers and nonpsychoactive
chemical derivatives. Products made from industrial hemp would also be legalized, allowing products
like hemp oil to avoid classification as an illicit drug alongside heroin and LSD.
That’s welcome news for Paul Gollobit, owner of American Shaman in downtown Omaha, a block east of the Douglas County Courthouse. Gollobit, along with his cousin Mike, has been selling hemp oil products since opening in October, joining many retailers
in the metro area – including four additional American Shaman locations – selling such products, despite a warning last month from Attorney General Doug Peterson that they remain illegal.
Hemp oil contains a chemical compound called cannabidiol, or CBD, that proponents say could offer health benefits, such as relieving pain and lessening anxiety. The products also contain a trace amount of THC, the psychoactive compound found in much larger amounts in the varieties of the cannabis plant used for marijuana. Industrial hemp contains up to 0.3 percent THC; recreational marijuana can have as much as 100 times that concentration.
“We’re not in the business of selling highs and buzzes,” said Mike Gollobit, manager of the downtown American Shaman store. “We’re here to help people.”
The 2014 farm bill authorized states to create hemp pilot programs and research hemp cultivation,
which opened the door for the sale of industrial hemp products, including high-CBD hemp oil. That is what creates the confusion – because federal law allows hemp to be manufactured and distributed.
“In our opinion, it is legal,” Mike Gollobit said of hemp-based CBD products. “If, at the federal level, we can have industrial hemp and industrial hemp products, then we’re legal.”
However, Nebraska statutes still classifies hemp-derived CBD under its definition of “marijuana,” according to the state attorney general’s memo issued last month. Any product that contains CBD “remains illegal to possess, manufacture, distribute, dispense, or possess with intent to manufacture, distribute, or dispense.”
CBD, and marijuana generally, is considered a Schedule I controlled substance, putting it alongside
illicit drugs considered to have a high potential for abuse and no accepted medical use such as heroin and LSD. A spokesperson for the Nebraska Attorney General’s Office said officials were still reviewing the impact of the farm bill shortly after its passage.
President Donald Trump has not yet signed the bill but was expected to approve the measure. Trump said the bill was “in very, very good shape” during remarks he made at the White House.
Nebraska does allow exemptions for a study by the University of Nebraska Medical Center to use CBD to treat seizures as well as for the recently-approved pharmaceu tical drug Epidiolex, a CBD oral solution approved by the U.S. Food and Drug Administration to treat two rare forms of epilepsy. The Nebraska Legislature also allowed the University of Nebraska to research industrial hemp cultivation.
The Gollobits said they hope the 2018 farm bill will clear up any confusion about CBD oil and affirm that it is legal to sell in Nebraska. They believe the industrial process used by American Shaman creates a superior product, and he hopes to be well-positioned as sale of CBD expands.
“That will pretty much eliminate all the gray areas,” Mike Gollobit said of the farm bill clarifying the law and opening up the door to expansion.
“The sky’s the limit.”
Products currently sold at their downtown Omaha store, located at 1517 Farnam St., include dietary supplement tincture, which can be taken orally or added to foods and beverages. Body lotions and anti-inflammatory creams allow CBD to be absorbed topically instead of ingested, and food and vape-ready products are also available.
Nationally, the market for CBD products has been growing strongly the past few years and stands to dramatically expand with the passage of the farm bill. Cannabis market
research firm Brightfield Group estimates the CBD market, for products derived from both hemp and marijuana varieties of cannabis, could be worth as much as $22 billion by 2022.
While the status of CBD derived from hemp remains murky, products derived from the cannabis plants with higher concentrations of THC remain illegal in Nebraska – regardless of whether they are for medical or recreational use. Across the Missouri River, however, Iowa has recently launched a medical marijuana program, with one of five statewide dispensaries opening in Council Bluffs earlier this month.
Iowa’s medical marijuana program is limited to CBD products – gel capsules, tinctures and creams – made in the state at one of two licensed manufacturers. Right now, only products made by Des Moines-based MedPharm Iowa are available for purchase.
The cannabis-derived CBD has a higher concentration of THC, up to 3 percent – that’s 10 times the concentration allowed in products from industrial hemp. For comparison, High Times magazine found that 2016’s most potent marijuana strains could exceed 30 percent THC. Concentrated THC is also being produced reaching concentrations
of 96 percent, according to the magazine’s rankings.
Other purveyors of hemp-derived CBD in southwest Iowa are in a similar position as Omaha retailers,
as well as online retailers who sell products in either state. The Iowa Department of Public Health issued a memo in December 2017 stating that CBD products that aren’t part of the state’s medical marijuana program “are not legal in the state of Iowa.” At the time, that included all CBD products in Iowa.
Scott Bean of Have a Heart Compassion Care in Council Bluffs said patients in Iowa shouldn’t expect
to get high from the CBD oil being sold through the state’s regulated medical marijuana program, which is approved for certain cases of cancer, multiple sclerosis, seizures, AIDS, Crohn’s disease, Lou Gehrig’s disease, Parkinson’s disease, some terminal illnesses and untreatable pain.
“The products here should not be producing any psychoactive effects,” said Bean, who’s Have a Heart’s national director of merchandise and apparel.
In addition to Council Bluffs, Iowa officials approved dispensaries in Sioux City, Davenport, Waterloo and the Des Moines suburb of Windsor Heights. Sales are prohibited to non-Iowa residents, including Nebraskans, and those without an Iowa physician’s approval.
As of Nov. 30, the most recent data available, 353 physicians in Iowa have certified 663 patients to obtain registration cards, allowing them to purchase marijuana-derived CBD products at the state-approved
dispensaries. No more than a couple dozen patients are registered in the southwest Iowa region of the metropolitan area. Nearly half of all Iowa patients registered for untreatable pain.
At the Council Bluffs dispensary, located at 3615 Ninth Ave., patients can order cannabis-derived CBD products using electronic kiosks. The general public can enter the dispensary to purchase merchandise and ask questions, but the staff at Have a Heart aren’t allowed to directly refer people to doctors to request registration cards.
“We don’t want to just be a retail location where somebody comes in and buys a single product just because
we want to sell it to them,” Bean said. “We’d like them to know what they’re buying and how it can help.”
Products for sale at American Shaman, 1517 Farnam St., include dietary supplement tinctures. (Photo by Scott Stewart)