New Regulations Could Put Vapor Product Companies Out Of Business

  • Friday, August 19, 2016

Aug. 8 brought upon us the new deeming regulations by the FDA on vapor products, otherwise known as electronic cigarettes. Calling the new rule "regulations" is a far stretch when in reality it begins the two-year countdown on prohibition of a live saving technology that has helped millions of smokers switch to a less harmful alternative. In fact, for the cigarette industry, this rule only strengthens their position and sales.

In a research briefing released on Aug. 8, Bonnie Herzog, a managing director for Wells Fargo, explained, “We expect to see a continued shift in consumption of e-cigs / vapor back to combustible cigs as e-cig choices become more limited — a net ‘win’ for big tobacco.”  

The pre-market tobacco application was designed to make it costly and nearly impossible for new combustible cigarettes to come to market. By the FDA's own admission, forcing all existing vapor products to go down this pathway could result in over 99 percent of companies in the vapor product market to exit the industry. Absurdly, it is now easier for a Marlboro cigarette to come to market than a less hazardous vapor product.  

Even though vapor products contain no tobacco nor emit any smoke, the agency has determined that anything related to vaping is either a tobacco product, or a part or component to a tobacco product, and thus subject to regulation. Moreover, the agency is determined to roll back the technology nearly a decade by continuing to use the Feb. 15, 2007 predicated date, which will force nearly every vapor product off the market. The FDA’s actions have frozen innovation and are now stopping companies that manufacture vapor products from improving on performance and safety.  

What does that mean for the industry here in Tennessee? There are an estimated 385 vapor shops and manufacturers across the state. Each shop has an average of five employees. That is 1,925 direct jobs that would be affected by the deeming rule, not to mention other industries like the postal service, bottle manufacturers, sign manufacturers, etc. that will be indirectly hurt.  The State of Tennessee should expect to see a significant hit to its sales tax revenues.  

Ultimately those that will suffer the most are smokers. An estimated 444,000 Americans die every year from tobacco related illness. For those that have tried and failed multiple times with available methods to break the combustible tobacco addiction, vapor products present an option that mimics the traditional cigarette and delivers nicotine without smoke and thousands of other chemicals. In August of last year, Public Health England - an agency within the U.K. government - concluded vapor products are at least 95 percent less harmful than combustible cigarettes. In April of this year, the Royal College of Physicians, one of the oldest and most respected in the world, concluded that on the basis of available evidence, e-cigarettes could lead to significant falls in the prevalence of smoking, prevent many deaths and episodes of serious illness, and help to reduce the social inequalities in health that tobacco smoking currently exacerbates. 

Yet the FDA's official, stated position on the relative safety of tobacco vs. tobacco-free cigarettes is as follows: "There may be a perception that electronic cigarettes...are safer alternatives to conventional tobacco products. ... However, FDA is not aware of any scientific data to support those perceptions." And here in the U.S., anti-vaping advocates continue to intentionally mislead and deceive the public. So called ‘tobacco control’ activists, as well as government agencies like the CDC and FDA, are actually protecting smoking and continued tobacco use while helping to preserve cigarette sales and cigarette company profits.  

The impact of the deeming regulations on vapor products will be not only felt by those small and medium sized businesses that will suffer severe economic losses.  In addition, the regulations will be detrimental to public health, as the FDA rule will eliminate far less hazardous products that are effectively competing with the tobacco giants. It is quite ironic that an agency entrusted to protect public health is actually using unfair, burdensome regulations to promote cigarette sales and protect big tobacco profits. 

Dimitris Agrafiotis
Executive Director Tennessee Smoke Free Association

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