Biotech, Food, Drug – Page 2

Over 25,000 Commenters Weigh in on EPA Draft Risk Assessment on PFOA and PFOS in Biosolids—A Recap

This article presents an overview of the comments on EPA’s first risk assessment regarding PFAS in biosolids, including a summary of over 100 major comments, and a link to EPA’s full comment docket.
What Happened?
Since the U.S. Environmental Protection Agency (EPA) released its Draft Sewage Sludge Risk Assessment for Perfluorooctanoic Acid (PFOA) and Perfluorooctane Sulfonic Acid (PFOS) in Biosolids (Draft Risk Assessment) in January 2025, interested stakeholders have been busy providing feedback to EPA, in many instances, on ways to improve the document. As Beveridge & Diamond reported previously, the Draft Risk Assessment aims to characterize the potential human health and environmental risks associated with the land application of sewage sludge as a fertilizer (biosolids) that contains PFOA and PFOS. Recycling biosolids for use on farmland is one of the largest recycling practices in the world and has been widely practiced across the United States for over 50 years, pursuant to federal regulations under the Clean Water Act, including a landmark risk assessment finalized in 1993. 40 C.F.R. Pt. 503 (Part 503).
The Deep Dive.
A diverse group of over 25,000 individuals and organizations submitted comments on the Draft Risk Assessment. Among the commenters were trade associations, municipalities, land application contractors, and private sector actors not directly involved in land application. Many commenters took issue with the Draft Risk Assessment’s conclusion that biosolids containing PFOA and PFOS at a low concentration of one ppb of PFOA or PFOS may exceed EPA’s conservative criteria for possible health risks under long-term exposure scenarios, which are largely inapplicable to most of the population. For instance, the U.S. Composting Council described the one ppb baseline as “exceptionally low”, and “lower than background levels found in soil, human blood, and everyday household products.”
This table summarizes the comments available on EPA’s online docket for the Draft Risk Assessment by many significant stakeholders, including wastewater agencies, biosolids management companies, trade associations in the wastewater, government, agricultural, and private sector actors. (We have excluded individual commenters due to length.) The detailed comments discuss peer reviewed literature on PFAS, biosolids and the environment and are a valuable resource for all interested in these issues. Similar detailed comments have been the basis of published scientific analyses on other technical PFAS proposals.
What Comes Next?
Publication of the Draft Risk Assessment represents the first step in EPA’s process in determining whether or not to amend the federal regulations governing the beneficial use of biosolids to include requirements for PFOA and PFOS. After considering all the comments submitted, EPA will ultimately publish a revised, final risk assessment that informs its subsequent decision as to whether or not to regulate PFOA and PFOS in biosolids.
In the meantime, the many states with biosolids regulatory programs that complement Part 503 have taken or are considering regulatory steps regarding PFAS. These measures have largely reflected state and local experience and knowledge that biosolids recycling through land application is valuable, environmentally beneficial, and very low risk. States and stakeholders frequently look to Michigan’s interim strategy, which establishes different management requirements depending on the concentration of PFOA or PFOS in the biosolids. Under the widely discussed “Michigan Model,” biosolids containing PFOA or PFOS at or above 100 ppb may not be land applied, biosolids containing between 20 and 99 ppb may be land applied with several additional requirements, and biosolids containing concentrations below 20 ppb may be land applied with no additional requirements.
Thanks to Associates Lia Crutchfield, Leticia Duarte, and Lexie Mulkey, and Summer Associate Dorje Wu for their contributions in developing this research.

Bicameral, Bipartisan Bill Would Strengthen U.S. Biopharmaceutical Manufacturing

On November 18, 2025, Senators Chris Coons (D-DE) and Ted Budd (R-NC) introduced the Biomanufacturing Excellence Act, which would promote U.S. leadership in biotechnology and strengthen domestic biopharmaceutical manufacturing. Coons’ November 18, 2025, press release states that “[b]iotechnology will shape how the United States defends itself, secures its food supply, and cures life-threatening diseases.” According to the National Security Commission on Emerging Biotechnology’s (NSCEB) final report, without rapid and significant investment, the United States will fall behind global competitors such as China. The legislation reinvests in domestic biopharmaceutical manufacturing, reducing dependence on foreign supply chains, expanding access to cutting-edge medicines, and supporting high-quality American jobs. The bill would establish a public-private center dedicated to advancing biopharmaceutical manufacturing, a key recommendation from NSCEB’s final report. The National Biopharmaceutical Manufacturing Center of Excellence would:

Unite industry professionals with academic researchers to conduct collaborative research on new technology for scaling biopharmaceutical manufacturing;
Host a facility that replicates industrial manufacturing conditions and complies with the U.S. Food and Drug Administration’s (FDA) Current Good Manufacturing Practice (CGMP) regulations, where innovators would develop and test new manufacturing processes;
Identify challenges and opportunities for scaling biopharmaceutical manufacturing, especially for products important to U.S. national security, public health, and economic security; and
Train tomorrow’s biopharmaceutical manufacturing workforce by partnering with educational, industry, and community leaders to bolster biotechnology talent.

Companion legislation (H.R. 6089) is being led in the House by Representatives Chrissy Houlahan (D-PA), Jim Baird (R-IN), David Rouzer (R-NC), and Deborah Ross (D-NC). More information on NSCEB’s final report is available in our April 25, 2025, blog item.

Preparing for HRSA’s 340B Rebate Model Pilot Program and the Beacon Platform

On October 30, HRSA announced that it had selected eight drug manufacturers to participate in its 340B Rebate Model Pilot Program, spanning 10 drugs representing a range of widely used therapies. These include:

Eliquis (Bristol Myers Squibb)
Enbrel (Immunex)
Farxiga (AstraZeneca)
Imbruvica (Pharmacyclics)
Januvia (Merck Sharp Dohme)
Jardiance (Boehringer Ingelheim)
Novolog (various forms) (Novo Nordisk)
Fiasp (various forms) (Novo Nordisk)
Stelara (Janssen)
Xarelto (Janssen)

When HRSA introduced its 340B Rebate Model Pilot Program earlier this year it changed how safety-net providers access 340B discounts. Instead of purchasing the drug at the 340B discount, 340B hospitals and clinics first pay the wholesale acquisition cost (“WAC”), then pursue their savings through a claim-based rebate process through the Beacon platform, which is managed by Second Sight Solutions. Many 340B Covered Entities have expressed concerns about the “time value of money” implications of the delay in realizing discounts and increased costs resulting from the extra work of submitting for rebates and addressing questions that manufacturers may raise. Second Sight Solutions is the same company that manages 340B ESP, the platform through which 340B Covered Entities fulfill manufacturer-imposed reporting requirements associated with their highly litigated contract pharmacy restrictions. Covered Entities who currently utilize 340B ESP will still need to create a new account on Beacon for the 340B rebate process. The 340B Rebate Model Pilot Program is set to go into effect on January 1, 2026.
The Beacon Rebate Process
Providers must initiate the 340B rebate process by registering on Beacon, submitting thorough business documentation (e.g., IRS letters, proof of incorporation, updated W-9s) and validating their bank accounts for ACH payments. While hospital covered entities only need to register an account for the parent 340B ID, grantee covered entities (e.g., FQHCs, Ryan White Clinics, etc.) must register each unique 340B ID.
Initial purchases for rebate-eligible drugs must be made through the Covered Entity’s 340B wholesaler account at WAC. After dispensing, providers must submit specific claim data codes and fields through Beacon for each dispense or administration, as follows:

Medical Claims
Pharmacy Claims

– 340B ID– Claim number– Claim line number– Date of service– Health plan name– Health plan ID– NDC-11– Rendering physician NPI– Quantity– Healthcare entity NPI
– 340B ID– Date prescribed– Date of service– Rx number– Fill number– NDC-11– Quantity dispensed– Prescriber NPI– Pharmacy NPI– Rx BIN and PCN

Unlike the upfront discount model, providers must upload claim files to Beacon after dispensing, making accuracy crucial, as data errors or duplicates can lead to payment delays and denials. Beacon provides real-time validation, tracking, and reconciliation, but every step of the claim submission process must align with both HRSA and manufacturer scrutiny.
Beacon has indicated that rebates will typically be processed within ten days of validated claims. This prompt turnaround is reassuring for 340B covered entities, but still means providers must adjust to a short-term cash flow gap. Instead of instant savings, expenses are reimbursed only after claims are reviewed and approved. For smaller clinics especially, this shift can impact budgeting and operational flexibility.
Providers also have to anticipate extra diligence when claim errors or mismatches occur. If a rebate is delayed, the workflow now involves coordinating with manufacturers and Beacon support before escalating to HRSA.
Ensuring Rebate Model Readiness
The 340B Rebate Model Pilot Program pushes providers to rethink their administrative and pharmacy workflows. It will be vital to train staff on the new claim requirements, Beacon’s submission process, and reconciliation protocols. TPAs and EMR vendors must be looped in to ensure data is formatted and transmitted correctly, and team members should know where to find Beacon’s support materials and troubleshooting tools.
As the pilot unfolds, the lessons learned will allow HRSA, 340B Covered Entities, and manufacturers an opportunity to consider whether and how the pilot may be continued and expanded in the years to come.
Listen to this article

Highlights from the MAHA Health Policy Gathering

On November 12, 2025, The “Make America Healthy Again” (MAHA) Summit was held under a veil of secrecy at the Waldorf Astoria in Washington, D.C. The summit brought together a high-profile mix of government officials, biotech leaders, wellness influencers, and policy advocates. Attendees included Health Secretary Robert F. Kennedy Jr., Vice President J.D. Vance, Centers for Medicare & Medicaid Services (CMS) Administrator Mehmet Oz, Food and Drug Administration (FDA) Commissioner Marty Makary, and National Institutes of Health (NIH) Director Jay Bhattacharya, among others.
The summit was a private, invitation-only event with no press access or livestream. When asked about attendance, organizers directed inquiries back to event coordinators. Although the daylong event was closed to the press, the agenda showed that a broad range of health topics were covered. Panel sessions covered the future evolution of FDA and NIH, innovations in compounding and pharmacy, the therapeutic potential of psychedelics, reversing aging, biohacking, and food as medicine.
In a livestreamed session, Vice President Vance commended Robert F. Kennedy Jr. for challenging conventional health approaches, emphasizing a focus on necessary rather than routine medication. Kennedy outlined goals to reduce artificial additives, address ultra-processed foods, update dietary guidelines, and limit environmental toxins.
Critics raised concerns about transparency and potential erosion of trust in established science, while organizers framed the event as a milestone for health policy reform.

Non-GMO Project Releases “Non-UPF Verified Standard”

The Non-GMO Project released its “Non-UPF Verified” Standard earlier this month. The release follows the launch of the new certification standard earlier this year.
The Standard, which attempts to define so-called “ultra-processed foods” (UPF), prohibits the use of any ingredient contained in “Annex B – Harmonized Prohibited Ingredients List,” which it indicates reflects a “selected collection of prohibited ingredients from quality standards and governmental regulations.” The Standard also divides food processing methods into prohibited, conditional, and permissible categories, which are in turn divided based on alleged differences in degree of processing (the permissible bucket consists of methods deemed to be “minimal” or “moderate”). A non-exhaustive (and very short) table (A.1) groups certain processing methods into these categories.
Notably, the processing criteria only apply to “ingredients declared on the product’s ingredient panel” and not to “sub-ingredients or processing aids that are not required to appear on-pack under applicable labeling regulations.”
The Standard ostensibly doesn’t apply to processing methods that are “demonstrably essential for food safety,” but it permits conditionally processed foods only up to 30% of the finished product, “regardless of food safety justification.” The Standard also contains limits on added sugars.
There is no consensus on how to meaningfully classify foods based on processing, and the science regarding the effects of so-called “ultra-processed food” remains unsettled. Indeed, the Standard incorporates ingredient bans and added sugar limits, neither of which directly relate to the term “processing.”

This Week in 340B: November 11 – 17, 2025

Find this week’s updates on 340B litigation to help you stay in the know on how 340B cases are developing across the country. Each week we comb through the dockets of more than 50 340B cases to provide you with a quick summary of relevant updates from the prior week in this industry-shaping body of litigation.
Issues at Stake: Contract Pharmacy; Other

In three cases brought by drug manufacturers challenging an Oklahoma state law governing contract pharmacy arrangements, defendants filed a notice of appeal.
In one case brought by a drug manufacturer challenging a Colorado state law governing contract pharmacy arrangements, defendants filed a motion to dismiss.
In two consolidated cases brought by drug manufacturers challenging a Nebraska state law governing contract pharmacy arrangements, plaintiffs filed a motion for preliminary injunction and a brief in support thereof.
In two cases brought by drug manufacturers challenging a Utah state law governing contract pharmacy arrangements, plaintiffs filed responses to the defendants’ notices of supplemental authority.
In one case by a trade association of drug manufacturers challenging a Rhode Island state law governing contract pharmacy arrangements, plaintiff filed a reply in support of its motion for preliminary injunction.
In one case brought by a drug manufacturer challenging a North Dakota state law governing contract pharmacy arrangements, defendants filed a cross motion for summary judgment.
In one case brought by a drug manufacturer challenging a North Dakota state law governing contract pharmacy arrangements, defendants filed a motion for judgment on the pleadings.
In one case by a drug manufacturer challenging an Arkansas state law governing contract pharmacy arrangements, the drug manufacturer filed response to the defendant’s notice of supplemental authority.
In one case by a covered entity against an insurance company alleging breach of contract, the covered entity filed an answer to the insurance company’s counterclaims.

Sydney Merritt Martinez contributed to this article

Infant Formula Maker Recalls All Product Due to Botulism Outbreak

Infant formula maker ByHeart has recalled all batches of its Whole Nutrition Infant Formula cans and Anywhere Pack sticks due to an outbreak of infantile botulism linked to the company’s products. ByHeart initiated the recall of two batches of formula on November 8, 2025, after it was notified of approximately 13 reported cases of botulism in infants that had consumed its products throughout the U.S. The company expanded the recall three days later after an additional 10 cases were reported.
California officials reported that a sample taken from an open can of ByHeart formula contained Clostridium botulinum, which leads to botulism infection. According to ByHeart, no previously unopened product has tested positive for the bacteria. In addition to recalling product, the company is conducting testing of every batch of formula through a third-party laboratory and providing FDA and the California Department of Public Health access to its facilities and unopened product for testing.
The families of at least two babies who were treated for botulism have sued ByHeart, alleging the company negligently sold defective formula that they purchased because they viewed it “as a natural, healthier alternative to traditional baby formulas.” The families are seeking payment for medical bills, emotional distress, and other harm.
Illnesses linked to ByHeart formula began between August 9 and November 11 and were reported in 13 states. Investigators have not identified any other infant formula brands or other sources of exposure in the outbreak.
Keller and Heckman will continue to monitor and report on this and other foodborne illness outbreaks.

This Week in 340B- November 4 – 10, 2025

In one case by a trade association of drug manufacturers challenging a Maine state law governing contract pharmacy arrangements, the plaintiff filed a notice of supplemental authority in support of its motion for preliminary injunction.
In one case by a trade association of drug manufacturers challenging a Rhode Island state law governing contract pharmacy arrangements, an amicus brief was filed in support of the defendant’s defense against plaintiff’s motion for preliminary injunction.
In one case brought by a drug manufacturer challenging a Colorado state law governing contract pharmacy arrangements, the Plaintiff filed a reply in support of its motion for a preliminary injunction.
In three cases brought by drug manufacturers challenging a Utah state law governing contract pharmacy arrangements, the defendants filed notices of supplemental authority.

High Stakes and Material Changes in the Bay State: Senate Bill No. 2722 vs. House Bill No. 4160

There were several material changes relating to strategy, compliance, and deal‑making advanced by Massachusetts Senate Bill No. 2722 (“S. 2722”) on November 13, 2025. Below is a short summary of what you need to know about the Senate’s rewrite and meaningful reshaping of several House‑backed ideas (under House Bill No. 4160 (“H. 4160”)) for changing the legal regime of cannabis in the Commonwealth.
1. Employee Stock Ownership Plans
Employee stock ownership plans (“ESOPs”) are here to stay. Both bills tell the Massachusetts Cannabis Control Commission (“CCC”) to set up clear procedures to allow the sale of a business to employees via an ESOP and to exclude a trustee acting solely for an ESOP during or after a sale when counting toward cannabis license caps under the Massachusetts cannabis laws. That part did not change, which is a positive result for the Commonwealth. The proposed changes to the current law enable succession planning, retention, and worker‑ownership options for operators and investors without tripping license caps and also improve exit/liquidity paths for owners. This also means there would be no caps on the number of licenses an ESOP can own.
2. License Caps Per Owner
This is one of the biggest splits between the two bills, although they have one thing in common—it is time to change the current license cap regime in Massachusetts.
The House bill would have eventually allowed up to six retail licenses per entity (phased up over time), while the Senate hard‑caps retail at four licenses. Both bills hold manufacturers at three licenses, cultivators at three licenses, and medical marijuana treatment centers at three licenses (matching current law).
S. 2722 also tightens the ownership threshold of when the license caps begin to be counted. The Senate sets the exclusion at a person or entity that possesses a “financial interest in the form of equity” under 12 percent, versus the House’s exclusion of any such person or entity under 35 percent. Practically, while S. 2722 preserves the ESOP pathways explained above, it clamps down on cap‑workarounds via larger minority stakes. S. 2722 reduces the ability to stack sizeable “non‑counting” investments across multiple licensees, which will affect how capital partners and multi‑license strategies are put together.
Both bills explicitly authorize the CCC to limit total license counts across adult‑use and medical. In other words, no change here—expect the CCC to retain a market‑balancing lever.
3. Cannabis Control Commission: Size, Appointments, and Roles
The current five-member commission is expected to be downsized. S. 2722 keeps a three‑member CCC proposed by H. 4160 but changes who appoints them and how they serve. The House would have had all three members appointed by the Governor, with only the chair as a full‑time role and the other two receiving stipends.
The Senate gives two appointments to the Governor (including the chair) and one to the Attorney General—and makes all commissioners full time with salaries pegged to senior state benchmarks. For operators, this could potentially lead to a more independent structure of the CCC, more resourced, and less concentrated in a single appointing authority.
4. Governance and Enforcement Separation
The Senate seems to draw a bright line between policy/adjudication and enforcement. Under S. 2772, the chair of the CCC cannot participate in or supervise investigations or other fact gathering that might later come before the CCC, and the executive director has independent authority over enforcement and operations. The House would have left more supervision with the chair and fewer formal firewalls. S. 2722’s approach could improve perceived fairness and predictability in enforcement and hearings.
5. Immediate Turnover of the Current CCC
Both bills reset the CCC. The House would have terminated all sitting commissioners on the effective date and have the Governor refill seats. The Senate also proposes to terminate current terms but requires reappointments under its new two‑Governor, one‑Attorney General appointment model within 30 days, with the Attorney General’s initial appointee serving a two‑year term. If these changes were to be implemented, operators should expect a short transition bump, but the Senate version of the transition spreads appointment power and sets faster, specific timelines.
6. Trade Credit and Delinquency Controls
With a saturated, price-compressed industry, and little capital to go around, operators are in need of some regulatory relief on significant delinquencies on aged invoices in their business-to-business sales. Both bills cap inter‑licensee trade credit at 60 days and create a delinquency list.
However, the operational difference is big: the House bill would have required “cash on or before delivery” for sales to posted delinquents, while the Senate bill allows certified funds, electronic funds transfer, or other CCC‑approved payments “on or before delivery.” S. 2722 is friendlier to real‑world accounts payable and accounts receivable workflows and potentially safer from a cash‑handling standpoint.
7. Hemp Beverages and Consumable CBD
Here the difference is stark. The House would have set up a comprehensive, separate regime for hemp beverages and consumable cannabidiol (“CBD”), including registration, off‑the‑shelf testing, endorsements for manufacturers/wholesalers/retailers, and a hemp beverage excise tax. The Senate’s newly proposed bill does not include a parallel hemp/CBD framework. If you were eyeing hemp beverages as an adjacent product line, H. 4160 would have opened a controlled (but complex) path while S. 2722 leaves the status quo.
8. Studies and Market Oversight
H. 4160 directed a license‑cap compliance audit and a broader economic analysis on license counts, supply/oversupply, and cultivation tier enforcement. The Senate targets a different research question: mental health outcomes tied to cannabis use, including psychosis and cannabis use disorder, and the effectiveness of public‑health interventions such as warning labels. If you are interested in seeing more guidance on labeling, warnings, and education, the Senate’s public‑health lens is more pointed.
The Bottom Line
As compared to H. 4160, expect tighter retail caps, stronger governance firewalls, and more practical payment options under delinquency rules with the proposal of S. 2722. As far as exit strategy planning, ESOPs are still addressed as a viable option outside of license caps.
However, nothing is final yet. S. 2722 is scheduled for debate on November 19, 2025.

Alabama Takes Step Closer to Issuing Medical Cannabis Dispensary License, Allowing Patients to Register for Program

Late Thursday, an administrative law judge (ALJ) in Montgomery issued a Recommended Order naming GP6 Wellness, LLC, RJK Holdings, LLC, CCS of Alabama, LLC, and Yellowhammer Medical Dispensaries, LLC as “the four most suitable applicants for a Dispensary License from the Commission.”
Capitol Medical, LLC was also deemed suitable, and in fact had been named as one of the top four applicants when the commission voted in December 2023 (I can’t believe that was almost two years ago), but “given the limited number of licenses and the evidence” Capitol was not included in the top four by the ALJ.
Each party to the administrative hearing has 10 days to file an exception to the order. The commission is expected to deliberate and vote on the order at its December 11 meeting. That vote will trigger a right for disappointed applicants to appeal to the Montgomery County Circuit Court.
Perhaps the biggest takeaway is that once a dispensary license is issued, the state can begin the process of certifying physicians and patients to join the list of qualified medical cannabis patients and medical cannabis can be dispensed legally.
Listen to this article

New Tariff Exemptions Announced for Agricultural Products

Key Takeaways: 

U.S. exempts certain agricultural products from reciprocal tariffs: Effective Nov. 13, the U.S. exempted certain agricultural products from reciprocal tariffs imposed pursuant to the International Emergency Economic Powers Act (IEEPA).
Exemptions apply to products not widely produced in the U.S.: Qualifying agricultural products include foods not grown or produced in sufficient quantities in the U.S., such as coffee and tea; tropical fruits and fruit juices; cocoa and spices; bananas, oranges and tomatoes; beef; and some fertilizers.
Importers should verify exemption status and pursue refunds if eligible: Businesses should consult the updated Annex II and monitor for misapplied duties, as refunds are available through standard Customs and Border Protection (CBP) procedures.

On Nov. 14, President Trump issued an executive order modifying the scope of the reciprocal tariffs originally imposed in April under EO 14257, adding a broad list of agricultural products to the existing exemption list as set forth in an updated version of Annex II to EO 14257 and the related Potential Tariff Adjustments for Aligned Partners Annex. These new exemptions took effect on Nov. 13.
Tariff Exemption Additions Reflect Progress in U.S. Trade Negotiations
The additions to Annex II reflect recent progress in trade negotiations. Since imposing global reciprocal tariffs, President Trump has negotiated several reciprocal trade deals (two reciprocal trade agreements with Malaysia and Cambodia; nine framework deals with El Salvador, Argentina, Ecuador, Guatemala, Thailand, Vietnam, the UK, EU and Switzerland; and two investment agreements with Japan and Korea).
Many of the announced trade deals and negotiations involve countries that produce substantial volumes of agricultural products not grown or produced in sufficient quantities in the U.S. President Trump therefore found it “necessary and appropriate” to exempt such agricultural products from the reciprocal tariffs. These products include coffee and tea; tropical fruits and fruit juices; cocoa and spices; bananas, oranges and tomatoes; beef; and some fertilizers.
Importers Should Review Updated Exemption List and Tariff Refund Eligibility
Businesses importing agricultural products should check the updated Annex II to identify whether their imports qualify for reciprocal tariff exemptions and whether they are eligible for refunds for any misapplied duties on exempted products. The modification order expressly provides for refunds on such improperly collected duties in accordance with standard CBP procedures.

The Long and Winding Road: Where Does the Hemp Industry Go from Here?

You’re awake. This is real. Yes, the federal government just passed a law that, if it goes into effect in its current form in a year, will essentially destroy the non-industrial hemp industry as it exists today. So now what?
I suspect it will take some longer than others to process the shock. While anti-hemp advocates are spiking the football and saying “we told you so,” hemp operators are facing an existential crisis to the businesses they created over the past almost eight years and wondering what to do next. In this space, I will do my best to explain how we got here and what, if anything, can be done to provide a path forward for hemp operators and the cannabis industry as a whole. Thanks, in advance, for stopping by.
What Is the New Law?
The Agriculture, Rural Development, Food and Drug Administration, and Related Agency Appropriations Act of 2026 (the “Agriculture Bill”) defines hemp as Cannabis sativa L. and any part of that plant, including seeds, derivatives, and extracts, with a total concentration of 0.3% THC (including — but not limited to — Delta 8, Delta 9, Delta 10, THCA, and THCV).
Unlike hemp’s definition under the 2018 Farm Bill, however, the Agriculture Bill expressly excludes certain intermediate and final versions of hemp-derived products. Legal hemp does not include hemp products that are not in their final form (intermediate products), or that are in final form (final products), and that 1) contain cannabinoids that are not capable of being naturally produced by a Cannabis sativa L. plant; or 2) contain cannabinoids that are capable of being produced naturally by a Cannabis sativa L. plant but were synthesized or manufactured outside of the plant.
For intermediate products, a total THC content of more than 0.3%, including any other cannabinoid that has an intoxicating effect on humans as THC, will take it outside of the legal protections afforded to hemp. The law prohibits the sale of intermediate products with a total THC content of more than 0.3% directly to consumers as a final product.
For final products, any direct-to-consumer packaging (such as cans, bottles, bags, or boxes) cannot contain more than 0.4 milligrams of total THC, including any cannabinoid that has or is marketed to have intoxicating effects on humans. Thus, not only must final products be below the 0.3% THC content restriction, they must also meet packaging restrictions, which will substantially impact THC contents and the final products’ production process.
Critically, the hemp provisions of the Agriculture Bill do not take effect for 365 days following enactment (i.e., November 11, 2026).
How Did This Happen?
Put simply, and this truly is not intended as a pun, the hemp industry got rolled. Actors in Congress (led by Mitch McConnell), encouraged by the marijuana and alcohol industries uneasy about the rise of hemp as well as those who believe for ideological reasons that hemp should not be available in intoxicated forms at traditional retail establishments, put language in the Agricultural Appropriations Act (which includes things like farm subsidies and SNAP benefits) and basically dared members of Congress to keep the government shut down to protect hemp interests. Of course, very few members of Congress were willing to do so.
Rand Paul certainly tried, proposing an amendment that would strip out the hemp language from the appropriations bill. That amendment was tabled by a vote of 76-24. Minutes later, the Senate passed the Agriculture Bill. Two days later, it passed the House and was signed by the president only hours later.
Why Is This Important?
Hundreds of thousands of Americans working in the hemp industry and tens of millions more who rely on hemp-derived product for a wide range of needs have been dealt a gut punch in the form of a law that could wipe out most of the country’s existing hemp industry within a year.
To some extent, any responsible hemp operator knew or should have known this was at least a possibility. The industry was created by the federal government, but reasonable people disagree on whether it was created on purpose. Since the 2018 Farm Bill allowed for the commercial production and sale of hemp, there have been questions about just what Congress intended when it passed that legislation. The ground has always felt uneasy.
On the one hand, you have those who argue Congress allowed for the sale of products containing less than delta-9 THC and there should not be a presumption that Congressional action is based on a misunderstanding or error. Congress speaks through the legislation it passes, and the legislation it passed in the form of the 2018 Farm Bill allowed for the explosion of myriad products that complied with the plain text of the law. And in reliance on that clear text, an entire industry was born and saw tremendous growth.
On the other hand, you have those who believe that most of the consumable hemp industry results from a clear loophole and that hemp operators should have been prepared for it to be closed at some point. I think it’s probably fair to say that members of Congress who voted for the 2018 Farm Bill did not have a full understanding of what they were allowing (if they had any understanding at all), but I have a hard time looking to purported Congressional intent in the face of clear legislative language. I think both things can be true at the same time: Congress may not have intended to allow the scope of the hemp industry, but it did.
What Happens Now?
The clock is ticking. There’s just one year before the law takes effect. Is that enough time to convince Congress to change the law? Technically yes, as Congress can act quickly when it wants to. But there are a few complicating factors.
First, although the law will not take effect until November 2026, as a practical matter we can expect to see a dramatic reduction in the amount of hemp grown in 2026 if hemp farmers aren’t assured they will have buyers for their harvest in Fall 2026. That means that a change needs to take place by Spring 2026 in order to avoid substantial supply chain interruptions.
Second, is there the political appetite and will to take up the issue of hemp again in the coming month? Congressional staff has been inundated with meetings and information about hemp for nearly two years as part of the Farm Bill debate. It will take a major effort to get Congress to engage on this issue again so soon, but if enough members would like the opportunity to debate the issue without the sword of a shutdown hanging overhead, that may be enough to overcome institutionalized inertia.
Third, can the hemp industry come together to make a specific “ask” for what a legislative change should look like? Congress seems unlikely to allow high-THC products, and that could pit low-dose operators against those seeking high-dose products. It will be interesting to see if a sizeable group of operators can get together to push for a federal hemp program that is more regulated and less open than the industry is used to.
Fourth, can the hemp industry bring together additional stakeholders and fend off well-funded and well-organized challengers? The alcohol industry will be important to watch here given that many manufacturers are opposed to intoxicating hemp products they view as competitive to alcohol, which has been on a steady decline of late. Alcohol distributors, on the other hand, have with increasing frequency taken on hemp customers as a way to offset the decline in alcohol sales. And what, if anything, will marijuana operators agree to allow?
Conclusion
The cannabis business has never been for the faint of heart or risk averse. As Ronald Reagan said in a much different context, “[t]he future doesn’t belong to the fainthearted. It belongs to the brave.” Is it time for hemp operators to pack up or time to get moving?
I certainly don’t think any hemp operator should feel shame or judgment in choosing a different line of business in light of this most recent development. Hemp businesses have already had to overcome so many obstacles and roadblocks, and there is no assurance that there will be any Congressional relief from what, as of the time of this writing, appears to be a prohibition of nearly all non-industrial hemp nationwide.
But for those who have chosen to persevere and those who are still making that fateful choice, I’d like to introduce LL Cool J to the annals of Budding Trends: “When adversity strikes, that’s when you have to be the most calm. Take a step back, stay strong, stay grounded and press on.”
Listen to this post