A CBD industry expert has encouraged companies not to fear the impact of novel foods regulation.
Tim Phillips, founder and managing director of CBD Intel, said 2021 is bound to be an uncertain time for the industry but stability and growth is on the horizon.
Speaking at Global Cannabis Intelligence’s virtual summit, he said the controversial regulatory process would win consumer trust and reshape the sector.
CBD products had to apply for permission to remain on UK shelves after the British government decided to recategorise them as novel foods in line with the European Union.
The expensive and slow process has seen just 42 go through to the next stage of authorisation and over half of the 800+ applications originally submitted have already been turned down.
Mr Phillips said the initial stages of novel foods will be uncertain for some – but ultimately, it’s a necessary step towards become a viable industry.
He said: “We’ve seen the UK become leaders in this regulatory process and that’s really interesting.
“There’s been a lot of criticism of the regulation and a lot of uncertainties from companies in the sector but we’ve seen a number of industries move from unregulated to regulated and I don’t think that’s unusual.
“I think this process is going work, I’m optimistic about it. I also think the UK will have a big impact on the speed the EU Commission starts to approve novel foods in Europe, it’s a very positive sign.
“Regulation in other industries has had a really positive impact on growth in that sector. What’s needed in CBD is regaining consumer confidence and getting some trust back.
“I think this regulatory environment will provide that, we’re optimistic about the impact of novel foods.”
Mr Phillips continued: “Novel foods is going to have a massive impact on the UK market and we’ll see how many continue through that process.
“We don’t think we’ll see the first approvals until next year an we’ll have a year in 2021 where there is a bit of uncertainty and where we may well see some companies pull out of the market.”
He also predicted the process will reshape the CBD market into a more supplement-led industry, with capsules replacing oils as the product with the largest market share.
Clearly labelled supplement products would be more likely to convince government scientists they don’t present a risk, Mr Phillips forecasted, and edible products like CBD-infused beverages or chocolate will initially struggle in the new regulatory environment.
Isolate products will also be more likely to win approval to the detriment of broad spectrum, he predicted, and topicals and cosmetics are also expected to be one of the big winners in 2022 as interest in oils wanes.
Mr Phillips warned 2021 was going to be filled with uncertainty for many businesses but 2022 will see the sector ‘grow in a much more controlled way’.