TGA proposes over-the-counter sales of CBD products

In a move that would appear to enthuse the ASX-listed cannabis stocks, the Therapeutic Goods Administration (TGA) has announced an interim decision to reclassify cannabidiol (CBD) products so they can be purchased over-the-counter at pharmacies.

The TGA’s provisional ruling entails the down-scheduling of low dose CBD products from Schedule 4 to Schedule 3 of the Poisons Standard. This means companies can apply to register their applicable products to be available through a pharmacist, without the need for a prescription.

Many pot stocks are developing CBD products and have been pushing hard for them to become more accessible in Australia.

One such small cap Althea Group Holdings (ASX: AGH) applauded the proposed regulatory change, with chief executive officer Josh Fegan describing it as one of the biggest developments in the medical cannabis industry to date.

“The interim decision reflects the significant shift in community and government attitudes towards medicinal cannabis since it was legalised in Australia in late 2016, which has seen it move from a fringe alternative towards an accepted mainstream option,” he said.

Althea also noted the proposed amendment would “bring patient access into closer alignment with comparable international jurisdictions”.

However, Incannex Healthcare (ASX: IHL) chief medical officer Dr Sud Agarwal warned Small Caps that the proposed amendment still has limitations.

“The most critical point is that the clinical asset must have gone through the same hurdles and meet the same regulations as any other prescription pharmaceutical,” he said.

Current process

According to Dr Agarwal, more than 60,000 patients in Australia have been prescribed cannabis via the Special Access Scheme or an Authorised Prescriber. He said this can be a “clunky” process, often involving an individual per-patient approval from the TGA each time.

“The high costs of seeing a doctor each time for a prescription and also the relatively finite number of approvable indications will deter some patients getting CBD,” he added.

Following public consultation and research, the TGA has concluded that CBD at low dosages is deemed safe and can be dispensed by a pharmacist over-the-counter – that is, without a doctor’s prescription.

New process

There are basic requirements for the down-scheduling of the drug. First and foremost, the CBD product must have a maximum recommended daily dose of 60 milligrams with only a 30-day supply able to be dispensed in one unit.

Schedule 3 means it must be kept behind the counter at a pharmacy, requiring interaction with a pharmacist prior to the sale. So, it still won’t be available on the supermarket shelf and means pharmacists can ensure consumers are aware of any potential interactions with other medications.

Only oral, sublingual (dissolvable under the tongue) and oral mucousal (mouth sprays) products will be permitted under the schedule, thus excluding smoking, vaping and topical CBD products.

Importantly, the product must be registered as a therapeutic good on the Australian Register of Therapeutic Goods (ARTG), meaning it will still need to meet quality, safety and efficacy endpoints like a prescription drug.

This includes standards such as the regulation that the drug’s final formulation can be manufactured with “minimal batch-to-batch variability” and all the non-active ingredients are listed and shown to be safe, and there is no significant adverse effects if the drug is administered at a much higher dose.

The product also needs to have therapeutic claim attached to it for a specific indication and it will have been tested in a rigorous double-blinded, randomised, controlled clinical trial that shows statistically significant results pertaining to this therapeutic claim.

Another important difference between CBD and other over-the-counter therapies is that, like cigarettes, any direct-to-consumer advertising of the product is banned.

Challenges of low dose CBD products

According to Dr Agarwal, one of the challenges of allowing the over-the-counter purchase of CBD is that the low doses permitted under the Schedule 3 regime means “there is a very small number of indications where you can meet the critical efficacy endpoints”.

In other words, the low dose products aren’t necessarily going to work as well or for as many medical conditions as the prescription version.

Secondly, producing stable, reproducible, GMP-grade CBD products with minimal batch-to-batch variability for any naturally-occurring substance is a challenge.

“Growing hemp or cannabis, extracting the oil and then formulating into final form and hoping for an identical product every time is a very challenging task,” Dr Agarwal said.

Over-the-counter therapies under development

Incannex has a distribution partnership with Australian medical cannabis prescriber network Cannvalate, of which Dr Agarwal is the chief executive officer.

He noted Cannvalate has a medical cannabis research collaboration with Melbourne’s Swinburne University and currently has four novel Schedule 3 CBD clinical assets under development in conjunction with external licensed producers.

“Meeting the critical efficacy endpoints within the allowed dosage framework was always going to be the most obvious challenge, but using some clever drug delivery technology, I think there are a range of plausible solutions,” Dr Agarwal said.

The TGA’s final decision on the scheduling is expected to be made in late November. In its announcement, the regulatory body said it has decided not to accept a private scheduling application which would have made CBD a freely available, unscheduled medicine.

According to cannabis market analyst FreshLeaf, the over-the-counter CBD market in Australia is expected to grow rapidly and could potentially exceed $200 million in revenue.