Ackrell Capital Overview of FDA Drug Approval and Scheduling Rules

ACKRELL CAPITAL CHAPTER IV U.S. Legal Landscape A drug generally may not be marketed for treating a condition other than a condition for which the FDA has found the drug to be a safe and effective treatment; however, most FDA-approved drugs can be prescribed by doctors to treat other conditions (so-called “off-label” prescriptions). Nonprescription or over-the-counter drugs can be marketed after receiving FDA approval through the NDA process or by conforming the drug to an existing over-the-counter “monograph” (a “recipe book” indicating acceptable ingredients, doses, formulations and labeling) established by the FDA. Cannabinoid-Based Drugs Several drugs containing synthetic cannabinoids or cannabinoid-like compounds have been approved by the FDA. Marinol, a drug comprised of dronabinol (a synthetic THC) encapsulated with sesame oil in a soft gelatin capsule, was approved by the FDA in 1985 for treatment of nausea and vomiting asso- ciated with cancer chemotherapy in patients who have failed to respond adequately to conventional antiemetic treatments. It was later approved, in 1992, for treatment of anorexia associated with weight loss in patients with AIDS. Syndros, a drug comprised of dronabinol in a liquid solution, was approved by the FDA in 2016 for treatment of the same symptoms for which Marinol was approved. Cesamet, a drug comprised of encapsulated nabilone (a synthetic cannabinoid similar to THC), was approved by the FDA in 1985 for treatment of nausea and vomiting associated with cancer chemotherapy in patients who have failed to respond adequately to conventional antiemetic treatments. Each of the drugs Marinol, Syndros and Cesamet was placed on CSA Schedule II within one to two years after its initial FDA approval (Marinol and Syndros were rescheduled from Schedule I upon recommendation of the DHHS, and Cesamet’s placement on Schedule II was its initial CSA classifica- tion). Schedule II through Schedule V substances can be prescribed by a doctor, but the CSA does not permit prescriptions for Schedule I substances, so removal of an FDA-approved drug from Schedule I is required before the drug can be prescribed legally. The FDA has not approved any drug derived from the cannabis plant. However, two such drugs, Sativex and Epidiolex (both manufactured by U.K.-based GW Pharmaceuticals), have advanced through certain stages of the FDA approval process. Sativex is a mouth spray used for treatment of spasticity caused by multiple sclerosis; it includes THC and CBD derived from cannabis. Epidiolex is an oral formulation of cannabis-derived CBD intended to treat severe forms of childhood epilepsy. Human clinical trials have been conducted with both drugs, and although an NDA has not been sub- mitted for Sativex, an NDA for Epidiolex was submitted to the FDA in October 2017. If approved by the FDA, Epidiolex would be the first FDA-approved pharmaceutical derived from cannabis. Foods and Dietary Supplements Generally, the FD&C Act defines “food” as (i) any article used for food or drink for humans or animals, (ii) chewing gum, and (iii) any article used as a component of any of the foregoing. The FD&C Act defines a “dietary supplement” generally as either (i) a product intended to supplement the diet that contains certain dietary ingredients (including vitamins, minerals, herbs, botanicals, amino acids, or other substances used by humans to supplement the diet by increasing the total dietary intake) or (ii) a product intended for ingestion in tablet, capsule, powder, softgel, gelcap, or liquid form and labeled as © 2017 Ackrell Capital, LLC | Member FINRA/SIPC 75 HOUSE_OVERSIGHT_024711