As a payer, you rely on evidence-based data from dossiers and analysis from independent bodies such as the Agency for Healthcare Research and Quality (AHRQ) and the Institute for Clinical & Economic Review (ICER) to inform patient access and drug-coverage decisions. The Cannabis Sativa L. plant holds promise to treat serious medical conditions, but very few pharmaceutical companies are conducting full drug-development programs for cannabis-derived medicines that provide this level of data and comparison. Why? Simply, it comes down to costs. 

While nearly 500 natural compounds are found within the Cannabis Sativa L. plant, about 66 have been classified as cannabinoids. The most well-known and researched are delta-9 tetrahydrocannabinol (THC) and CBD (cannabidiol).13 However, without investment in clinical research of these compounds, the full potential of cannabinoids as medicines will likely never be realized. The reality is existing legal and regulatory frameworks at the state level have been insufficient to stimulate broader investment in the FDA-approval pathway.  Within the framework of state medical marijuana laws, cannabinoid products go to market without clinical research, disincentivizing the investment that this level of research requires for the sake of profit.  As a result, millions of Americans are self-treating serious and life-altering ailments with unproven, inadequately regulated, and unapproved cannabis and cannabis-derived products with the belief that they are cost effective and “safe.”

As payers, it is critical to recognize that as patient and consumer demand increases, so does the need for greater scientific understanding of cannabis and cannabinoids. Randomized clinical trials to examine the medical validity and safety of dispensary and retail products have not been conducted, and these products are not FDA approved. The information you, as payers, need to inform access and reimbursement decisions - including evidence-based data that demonstrates what one product brings to the market vs another and how it will be positioned relative to other products - simply doesn’t exist in the current environment. A greater investment in FDA-caliber, cannabinoid research is critical to inform and improve patient outcomes to demonstrate the value of cannabis-derived medicines.
Below are key differences and why medical marijuana products may cost less in some instances, but ultimately at the price of patient safety. 

Table 1: FDA-Approved vs Non-FDA Approved

FDA-Approved Non-FDA Approved
  • Studied in placebo-controlled, publicly disclosed clinical trials with large patient samples to determine efficacy, safety, and recommended dosing.
  • Produced according to regulated, current good manufacturing practices (cGMP). FDA-approved medications must adhere to strict specifications that ensure batch consistency and stable shelf life.
  • Meets FDA standards for quality, stability, and consistency. Tested to ensure they contain the consistent concentrations of cannabinoids and other product ingredients listed on the label.
  • Federally legal as prescribed; similar to other DEA-controlled prescription medicines.
  • Eligible for insurance coverage.
  • Randomized clinical studies have not been conducted. Public disclosure of smaller, informal studies not required.
  • Testing standards vary from state to state, and some states require no testing. There are no federal standards; FDA does not inspect the manufacturing sites for adherence to cGMP.
  • Nonprescription, non–FDA approved cannabinoid products are subject to inconsistent regulation at the state level. There are no federal standards for testing to ensure accuracy and consistency.
  • Restrictions to access vary by state. Healthcare providers can “recommend” but not prescribe hemp products or marijuana, as they are illegal at the federal level. Interstate transportation of these products is federally illegal.
  • Insurance coverage is rare.


13Learn About Marijuana Fact Sheet, Alcohol & Drug Abuse Institute, University of Washington, Available at:; accessed 11/8/19.