Colorado has been the leader in cannabis since 2012, when we, along with Washington, became the first two states in the nation to legalize and regulate cannabis for recreational purposes through the approval of Amendment 64. Since then, almost half of the US states have also followed suit, making Colorado the benchmark for cannabis reform.

However, with the passing of the Farm Bill in 2018, an unintentional loophole emerged, allowing unlimited amounts of intoxicating cannabinoids from hemp to be sold as CBD products. The lack of specificity in the Farm Bill provided companies with the opportunity to exploit this ambiguity, leading to the rise of Delta-8 products and synthetic cannabinoids. In response to this, Colorado legislators introduced SB 22-205 in April 2022 to address the growing regulatory issues involving intoxicating cannabinoids from hemp.

SB 22-205

On May 31, 2022, Governor Jared Polis signed SB 22-205 into law. In essence, SB 22-205 is a Bill, “Concerning the regulation of cannabis-related products that may potentially cause a person to become intoxicated when used”. According to the Bill summary, “The act authorizes the department of public health and environment to prohibit the chemical modification, conversion, or synthetic derivation of intoxicating tetrahydrocannabinol isomers that originate from industrial hemp or may be synthetically derived”. The Bill also created a Task Force with the goal of studying intoxicating hemp products and making legislative and rule recommendations.

SB 22-205 Task Force

Following the passing of SB 22-205, the SB 22-205 Task Force was established to “collaborate on a report to the General Assembly concerning intoxicating hemp products, legislative and rulemaking recommendations, and the analysis of the effectiveness of each recommendation for the regulation of intoxicating hemp products”. The Task Force consisted of 20 different stakeholders, including representatives from the hemp and marijuana industry at all levels, attorneys, consumers, patients, and government officials. Out of the 180 applications received, our co-CEO, Dr. Priyanka Sharma, was invited to be one of the stakeholders on the Task Force. After six months, with over 20 different meetings and over 100 hours of deliberation, the Task Force distributed a final report to the General Assembly on January 3rd, 2023. Task Force report recommendations included new classifications of cannabinoids, THC limits for hemp, label requirements, convening of a standing scientific committee, and a manufacturing safe harbor.

The classifications of cannabinoids involved grouping cannabinoids into three different classifications: non-intoxicating cannabinoids (which includes CBD), potentially intoxicating cannabinoids, and intoxicating cannabinoids (which includes THC and its isomers). The recommended THC limits for hemp were set at a maximum of 2.5 mg THC per serving and a ratio of CBD:THC greater than or equal to 15:1. Label recommendations included the labeling of synthetics, a notice statement that the product contains THC, and rules against marketing the product as containing THC’s or other potentially intoxicating cannabinoids. The purpose of a standing scientific committee was to “assist the agencies in the ongoing evaluation of scientific data and research related to cannabinoids investigation and the evaluation of cannabinoids for their safety profiles and intoxicating potential, including the appropriate classification of cannabinoids”. Finally, the manufacturing safe harbor was recommended for current companies whose products are synthetically made, or deemed outside of the hemp limits, so they could continue to export these types of products outside of Colorado to states that allow it.

SB 23-271

Bill SB 23-271 was introduced to the Senate in early April 2023. While taking into consideration the SB 22-205 Task Force recommendations, amendments were introduced and passed in the Senate that made this Bill different from what was brought forth by the Task Force. Similar to Task Force recommendations, the three cannabinoid classification groups are still part of this Bill. The classification of cannabinoids will allow us to know which specific regulatory pathway each cannabinoid would need to take. Non-intoxicating cannabinoids would be regulated by the Colorado Department of Health and Environment (CDPHE), while the potentially intoxicating and intoxicating cannabinoids would be regulated by the Marijuana Enforcement Division (MED).

The THC limits for hemp products have been amended and now stand at no more than 1.75 mg THC per serving. However, the CBD:THC ratio limit still remains at greater than or equal to 15:1. Products with THC content above 1.75 mg per serving and CBD:THC ratios below 15:1 are considered intoxicating. They are now classified as marijuana and must go through the MED regulatory pathway before being sold at a dispensary.

A recent amendment that passed introduces an age gate for products, establishing a minimum purchasing age requirement. It is now unlawful to sell a hemp product with more than 1.25 mg THC per serving or with a CBD:THC ratio of less than 20:1 to individuals under 21 years of age. Consequently, any hemp products containing 1.25 mg to 1.75 mg THC per serving or having a CBD:THC ratio between 15:1 and 20:1 would be prohibited for purchase by individuals under 21 years old. This amendment had also been introduced to regulate the container sizes of hemp products within these limits. The final Bill establishes that the container size of these products should not exceed 5 total servings per package. Additionally, it requires that hemp products with greater than 1.25 mg THC and a CBD:THC ratio of 20:1 or more, have a maximum container size of 30 servings. However, it specifies that hemp tinctures (limited to 4 fluid ounces max), cosmetics, products with no THC, and GRAS certified hemp products are exempt from the above container limits and can be sold to individuals under 21 years of age, regardless of the THC content or ratio.

One amendment had added specific testing requirements, including the testing for heavy metals, residual solvents, pesticides, THC, yeast and mold, among other things. It also added stringent labeling requirements that are in line with the current marijuana labeling rules. The label would need to include the amount of THC and number of servings per package, a universal THC symbol, and it must note if it contains any amount of synthetics or semi-synthetics. Similar to the Task Force recommendations, there is to be no marketing of the product as containing THC’s or other potentially intoxicating cannabinoids. A recently passed amendment gives labeling authority to CDPHE to promulgate the necessary label requirements to inform THC content and the CBD:THC ratios. CDPHE must also consider existing marijuana labeling rules.

The original Bill had been introduced requiring “the executive director of the department of revenue to analyze the feasibility of establishing a standing committee to evaluate cannabinoids and cannabis-derived products for the purpose of determining and making recommendations regarding their safety profiles and potential for intoxication. The department of revenue may engage experts to do this analysis.” Instead of creating a standing scientific committee, the department will analyze how feasible establishing such a committee would be by July 1, 2024.

The manufacturing safe harbor was completely removed via an amendment during the first hearing but was brought back during another committee hearing. The current manufacturing safe harbor in the Bill bans all production of synthetic cannabinoids. One stipulation is that safe harbor producers must ensure physical separation between hemp products and safe harbor products during manufacturing, production, storage, and distribution. However, if the same equipment is used, the producer must either establish internal processes following Good Manufacturing Practices (GMP) approved by CDPHE or adhere to rules promulgated by CDPHE. Similar to the previous Task Force recommended manufacturing safe harbor, exporting to states where safe harbor products are not explicitly prohibited, would still be allowed.

Lastly, the Bill will give rulemaking authority to CDPHE and the Department of Revenue (DOR), so that they can act before having to go through a whole other legislature. This way, as data becomes readily available, the departments can act quickly to make changes to the rules, if necessary.

Colorado & Cannabis

It is crucial, now more than ever, to ensure passage of this Bill. At the time of this writing, it is on its way to the Governor’s desk to be signed. While it might not be perfect, it represents a necessary initial stride towards safeguarding public health and safety here in Colorado. As our country gradually moves towards federal cannabis legalization, setting a positive example in Colorado becomes increasingly important. As previously noted, other states often look to us as leaders in cannabis policy and are likely to follow in our footsteps.

Bia Campbell and Christian Sederberg, from VS Strategies, played an integral role in bringing this Bill to fruition. Christian, a former member of the SB 22-205 Task Force, commented on the final outcome of the Bill and its potential to elevate hemp industry standards nationally. He stated, “The final legislation reflects a broad stakeholder engagement process that took place over the past 18 months. We are pleased with the compromise that has resulted, as it prioritizes public health and safety while striking a balance among several diverging interests. Product safety and regulatory compliance are critical to the wellbeing of patients and other consumers, and they are paramount to the entire cannabis industry, including hemp and marijuana. The bill creates much-needed delineation between intoxicating and non-intoxicating products, and protects young people from those with high levels of THC. It prohibits products that are potentially dangerous, while allowing for continued research and development of hemp-derived cannabinoids and products. This is a significant first step in addressing what will be an evolving policy issue in many states over the next few years. Colorado remains a national leader on cannabis policy, and it will play a significant role at the federal level as discussions about the farm bill continue.”