E-cigarette Regulations Give Industry The Vapors
The electronic cigarette industry, with millions of dollars at stake and little time to change Washington’s mind, is lobbying hard to shield most of its products from federal oversight.Tobacco giants and tiny vape shops alike want members of Congress to agree that e-cigarettes already on the market won’t need federal approval in the future. A burgeoning, billion-dollar industry is at risk. Public health pressure groups counter that they are just trying to avoid regulation.
Time doesn’t seem to be on the industry’s side. The White House is vetting the first-ever regulations from the Food and Drug Administration for e-cigarettes, and a decision is expected by early next year.
Industry wants Congress to change one thing, the grandfathering date of Feb. 15, 2007, which appears in proposed regulations. It’s that date that will determine which products need federal approval. If a product was made after that date, new regulations say it must get agency approval, even if it is already on store shelves.
To comply, companies would have to send in an application including results from clinical tests on the product’s health risks. If the company doesn’t seek approval, then the FDA can pull the product from the market.
The e-cigarette industry and vaping advocacy groups are crying foul, saying most e-cigarette products weren’t made before 2007. They want a much more recent grandfather date. They want the cutoff to be the date that the final regulations are released. In other words, anything on store shelves before the regulation itself comes into effect.
“There is some debate about whether there was anything at all on the U.S. market at the time,” said Carl Phillips, chief scientific officer for the nonprofit Consumer Advocates for Smoke-Free Alternatives Association, which is pushing for a change in the grandfather date.
An e-cigarette differs from a regular cigarette because it is not tobacco. The e-cigarette contains a liquid that is vaporized and inhaled by the user.
The products are battery-powered and a majority of them contain nicotine.
Phillips said the 2007 grandfather date is effectively a ban on e-cigarette products, because most companies won’t want to devote the time and money to getting the testing done.
Other advocates are worried about the impact on as many as 10,000 vape shops in the U.S. that sell customized vaping pens and accessories.
“Without a change in [the grandfather date], every vape shop in the country will be shut down,” said Gregory Conley, president of the industry-supported advocacy group American Vaping Association.
The vape shops themselves don’t manufacture products, but their wholesalers could decide to not comply with the FDA and move on, Conley said.
The proposed regulations would not go into effect until 2018, or two years after they are finalized.
New grandfather date
House lawmakers are trying to push the grandfather date up to when the final regulations are released, effectively giving every existing e-cigarette product a regulatory pass.
Rep. Tom Cole, R-Okla., introduced a bill in May to do just that, saying that the 2007 date was arbitrary.
“Normally we grandfather things in up to the point of the regulation,” he told the Washington Examiner. “It seems to me almost like retroactive regulation.”
Cole’s bill hasn’t gone anywhere in the House. However, a rider in an agriculture appropriations bill prohibits the FDA from using any funds to implement the law unless the grandfather date is changed.
But the FDA has said that it cannot change the grandfather date because it was included in a 2009 law that gave the agency authority over tobacco products.
That is why the Smoke-Free Alternatives Trade Association, another vaping group, is pushing for action in the Senate to change the date in the law. The group wrote to Senate appropriators on Nov. 30 asking for a rider changing the date to when the regulations are finalized.
The question now is whether any rider becomes part of the latest spending package that must be approved before Dec. 11 when the government runs out of money.
Negotiations for the spending bill were expected to begin on Nov. 30. Even if such a rider survives Congress, it has to get past the president.
“The stock [Obama] administration response is they are against all riders of all kinds at all times,” Cole said.
With the spending bill aiming to fund the government until 2017, it is “our best opportunity to really affect change,” Conley said.
But health advocacy groups are pushing for Congress to reject any change to the grandfather date.
The 2009 law recognized that the tobacco industry is constantly trying to find new products to entice kids and made it harder for smokers to quit, said Erika Sward, assistant vice president for national advocacy for the American Lung Association.
The idea behind the grandfather date was to “not let the market be completely flooded with new products without any consideration of the impact of public health,” said Gregg Haifley, director of federal relations for the American Cancer Society’s Cancer Action Network, the group’s advocacy arm. “Obviously, the industry is maneuvering to escape that kind of review by the FDA.”
Both groups have said federal oversight of such products is needed as soon as possible, including the ban for sales to minors. A recent government study found that current e-cigarette use among middle and high school students tripled from 2013 to 2014.
“What we are seeing is that kids and public health are being hurt by the absence of basic oversight of these products,” Sward told theWashington Examiner.
Case in point: “exploding e-cigarettes,” she added. There have been several documented instances of exploding e-cigarettes. In late October, for instance, a man in Florida was put into a medically induced coma after his e-cigarette exploded in his face.
But such incidents are very rare, Conley said. “With millions of ex-smokers using vapor products on a daily basis, the U.S. Fire Administration reported there have been just 25 incidents involving e-cigarettes from 2009-14,” he said.
The FDA estimates that conducting the scientific investigations for an application would take about six months and will cost e-cigarette makers more than $300,000.
But the industry says it is much more. Altria, which has two brands of e-cigarettes, estimate testing could cost more than $2 million.
If the grandfather date is moved up to the date the final regulations are released, then companies could potentially save a lot of money.
But Altria denied that was a factor in its support for the Cole bill.
“It is not a pass,” said David Sutton, senior manager of media affairs for Altria. “Our view is that 2007 seems arbitrary and way before the way cigarettes were treated.”
Sutton declined to say whether Altria would raise prices on its e-cigarette products if the grandfather date doesn’t change.
It remains unclear whether tobacco giants such as Altria and R.J. Reynolds Tobacco Company will exit the e-cigarette market if they are faced with the 2007 date remaining intact.
In Reynolds’ latest financial report, the company said its strategy is to encourage adult smokers to switch to smoke-free products such as vapor and e-cigarettes. Shipments of regular cigarettes declined about 3 percent last year from the year before, the company said.
The situation is far different for the vape shops, traditionally small businesses that offer customizable e-cigarette products. A vaping pen can cost as much as $100 and can be customized with different tanks and atomizers to turn flavored liquids into vapor.
Reynolds and Altria, on the other hand, offer more of a closed system e-cigarette available at retailers such as convenience stores. Conley said larger companies such as Reynolds or Altria could absorb the costs.
“Without a change in the grandfather date there is no hope but for all but the largest multinational tobacco companies to continue to be in this industry,” he told the Examiner.
The FDA told the Examiner that it considered the burden to small businesses. It tried to propose different compliance dates for various provisions so that small businesses and all regulated companies can have time to comply, said spokeswoman Tara Goodin.
She did not comment on Cole’s bill, saying that the agency doesn’t weigh in on pending legislation.
Even if the grandfather date were changed, all e-cigarette makers still need to comply with requirements to put warning labels about health risks on their products. They also have to register with the agency and divulge their ingredients.
The proposed regulations were released last year, and now are before the White House for a final decision. Groups on both sides of the issue have met or scheduled to meet with administration officials in the coming weeks to make their case for last-minute changes.
As of Nov. 30, there have been 33 organizations that either will meet or have met with officials, federal records show. Of that 33, about 19 are either vape shops or vaping pen manufacturers and other industry representatives. Another three are consumer groups or think tanks advocating for vaping.
There are seven public health advocacy groups such as the American Heart Association or Campaign for Tobacco-Free Kids. In addition, four groups or businesses represent cigar shops or makers because the regulations also encompass cigar manufacturers.
While the agency said it couldn’t change the grandfather date, other pressing issues are still up in the air.
Chief among them is whether to ban flavors of e-cigarettes, which the regulations don’t address but the agency could take up at a later date.
Haifley said that the liquids, which can come in flavors that run the gamut from cherry to Thin Mint Girl Scout Cookie, entices kids to take up e-cigarettes and get them addicted.
Flavors aren’t intended to entice kids, but to help people to quit smoking, Conley said. “Surveys have shown that ex-smokers rate flavor variability as extremely important in helping them become and stay smoke-free,” he said.
Conley added that the proposed regulation would be a de facto ban on all flavors since it is extremely unlikely any company will spend the money to keep a flavored product on the market.
Whether the products help people quit smoking is up for debate, with no conclusive evidence pointing that e-cigarettes help people quit.
Another pressing issue is advertising on TV, which is prohibited for regular tobacco products. The FDA has not determined whether to make a similar decision for e-cigarettes.
Altria, for instance, has already started to test advertising for e-cigarettes from the hours of 9 p.m. to 2 a.m. in Dallas.
“We think advertising is OK for the category, but the FDA has the authority to make that determination and how to do that,” he said.
Haifley chafed at the industry’s response to the pending federal regulations, saying that oversight of e-cigarette products is needed.
“Business needs to figure out a way to comply as opposed to getting a get out of jail pass,” he said.