CBD cosmetics – a cautionary tale

Unlike other markets (i.e. Canada, the US, the UK and parts of Europe) CBD is more strictly controlled in Australia, and the pure extracts (as well as any associated products) are considered Schedule 4 prescription drugs under the Poisons Stan dard.

One of the top questions I get asked as a medicinal cannabis consultant is: “Can I produce CBD cosmetics in Australia?” My answer is usually along the lines of: “Technically yes, but you’ll be in for a world of unnecessary pain, so why would you want to?”

The next question is often: “Can I extract CBD under my hemp licence.” If you were in the US, yes, however we are in Australia and no, you cannot. (I previously detailed why in another blog.)

So why am I so against CBD cosmetics you ask? Well…I’m not, but as with all things, it’s complicated and I’m going to give you a breakdown below:

1. Cosmetics regulations

If you make cosmetics in Australia, as long as you are making no therapeutic claim, you will come under the jurisdiction of ISO 22716 which is the Good Manufacturing Practice (GMP) standard used for all cosmetic products across the globe (which PharmOut can also help you with).

ISO 22716 has some similar (but not identical) requirements to PIC/S GMPs but is namely concerned with control over production, storage and shipment of cosmetic goods (i.e. quality aspects).

A brief overview of the requirements is detailed below (if you are not interested, feel free to skip the table):

-	Area	Requirements
	Personnel	Organisational chart with roles and responsibilities clearly defined, training program in place with level of training for staff adequate and ongoing for their expected tasks, personnel health and hygiene policies and practices in place, control over visitors and third parties.
	Premises	Buildings and workspaces designed and constructed to ensure protection of product, permit efficient cleaning and minimise mix-up of products, raw materials and packaging materials, implementation of Pest control programs.
	Equipment	Must be suitable for intended purpose and cleaning requirements, kept on a calibration and maintenance schedule to ensure it is in good working order. Only used by appropriately trained personnel.
	Materials	Suppliers of raw materials and consumables should be carefully evaluated and selected to ensure materials purchased meet defined acceptable criteria so that the quality standard required for the finished product can be met. Traceability of materials through the site should be maintained (i.e. receipt, ID, status and release) through to appropriate storage and re-evaluation if required. Also maintaining control over different waste types.
	Subcontracting	Any service providers to undergo supplier evaluation and selection for their suitability and ability to supply the required service. Agreements to be signed that detail the specific services and responsibilities of each party.
	Production	Documentation available at each stage of operation that defines suitable equipment, batch formula, raw materials, manufacturing instructions. This includes batch numbering, start-up checks, in-process controls, storage requirements, etc. There should be defined control over release, shipment and returns processes.
	Quality Control	Defined sampling and test methods, acceptance criteria, assessment of results.
	Quality Assurance	Site documentation and batch control, change control, internal audits, deviations, complaints and recalls.

Other regulations you will need to be aware of (specifically related to cosmetics ingredients labelling) are:

It should be noted that these labelling requirements do not apply to:

a) “therapeutic goods” as defined in the Therapeutic Goods Act 1989

b) cosmetics manufactured in Australia for export, or free samples or testers of cosmetic products.

The former (a) is where it starts to get contentious, especially when thinking about manufacturing CBD cosmetics.

2. TGA vs NICNAS

(You must love all the acronyms.)

The Therapeutics Goods Act 1989 defines “therapeutic goods” as:

(a) for therapeutic use; or

(b) for use as an ingredient or component in the manufacture of therapeutic goods;

Admittedly there is a lot more covered in this definition, but (b) is what I’m going to focus on.

There are a variety of different regulators that monitor different chemicals and their uses, as defined below:

-	Chemical	Regulator
	Industrial Chemicals	National Industrial Chemicals Notification and Assessment Scheme (NICNAS)
	Pesticides and veterinary medicines	Australian Pesticides and Veterinary Medicine Authority (APVMA)
	Medicines and medicinal products	Therapeutic Goods Administration (TGA)
	Food additives and contaminants	Food Standards Australia and New Zealand (FSANZ)

The TGA usually defer to NICNAS for any chemical compounds used in cosmetics.

3. Is my product a cosmetic?

To find out if your product is a cosmetic, you can take the NICNAS quiz here.

However, before you take the quiz, ensure to read the Therapeutic Goods (Excluded Goods Determination 2018) (which superseded the Cosmetics Standard 2007).

Excluded products include, for example:

“Skin care products, including spot treatments, cleansers, face scrubs and masks, that do not contain any substance included in Schedules 2, 3, 4, or 8 to Poisons Standard.”

If your active compound falls into the exclusions, then happy days, you’re making a cosmetic (and subsequently need to register your business with NICNAS).

BUT, CBD is considered a Schedule 4 prescription drug and is not excluded, ergo it falls under the jurisdiction of the TGA.

4. But I still want to make CBD cosmetics

Ok, then you will have to get a TGA manufacturing licence and comply with the full swathe of PIC/S GMP requirements. (Spoiler alert: it’s expensive and you better learn to love paperwork.)

ISO 22716 is one thing, but PIC/S GMPs are an entirely different story. We have covered requirements extensively for medicinal cannabis here, here and here. We also have a number of blogs all around GMP and PIC/S if you wish to go further down the rabbit hole.

Skipping ahead, once you finish setting up everything that’s required to obtain the TGA manufacturing licence for your site and produce your finished product, you then have the option of either:

listing the product on the ARTG – for export only of GMP pharmaceutical-grade cosmetic products to other markets that treat CBD less strictly (which is overkill, unless you’re trying to go for the Australian complementary medicines effect), OR
putting your products through the clinical trials process in order to register them as approved drugs on the ARTG, (customers will still require a prescription for access), OR
making products available through the SAS-B and Authorised Prescriber channels (which again, requires a prescription for access).

As an aside, you should also be aware that it is prohibited to advertise prescription drugs to the public.

As an alternative business strategy, you could:

extract CBD and sell it on as an API to other markets who are able to manufacture CBD cosmetics under ISO 22716 and not PIC/S GMPs, OR
make hemp cosmetics (no CBD – using pressed hemp seed oil and other appropriate derivatives) which you can advertise and sell to your heart’s content.

5. Closing remarks

I’m not saying that manufacturing CBD cosmetics can’t be done – obviously it can but they are considered therapeutic goods, NOT cosmetics, thus will require much more effort and expense than normal cosmetics manufacturing.

Regarding the supply chain for CBD cosmetics products, under the Medical List of specialties, field and related titles Registration Standard, specialized Dermatologists who are registered under the Australian Medical Council and also registered as Authorised Prescribers would be able to issue prescriptions.

However, even if this pathway was to be taken, the success of a business comes down to accessibility and affordability. With regards to CBD cosmetics in Australia, accessibility would be limited to niche providers and affordability is foreshadowed by the cost of local production; any CBD cosmetics will have to be manufactured under PIC/S GMP compliance within Australia, thus are likely to be far more expensive than other cosmetics manufactured under ISO 22716.

A report released by Cannabis Access Clinics provides more insight into costs. The report indicates that between 2017 and 2018, patients spent (or were willing to spend) an average of $334 per month on medicinal cannabis. (Note that the numbers in the report reflect cannabis oils which will presumably be of higher concentrations than in the cosmetics.)

Still, if the prices are comparable that’s a lot to be paying for cosmetics! Another consideration is that in these early days of the medicinal cannabis industry, prescription CBD in a cosmetic form is unlikely to be subsidized by Medicare or covered by private health insurance.

To summarise: Manufacturing CBD cosmetics in Australia is not impossible but highly impractical. If you do still want to go down this pathway, until Regulations change to be more accommodating of the chemical and product type, be prepared for a lot of swings and roundabouts to comply with the requirements of manufacturing a prescription medicine.

Want more?

If you want to find out more, or want to have a chat about medicinal cannabis or GMP, please feel free to get in contact with us contact us at one of our offices around the world.

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