The FDA is About to Kill the e-Cigarette Industry.
The U.S. Food and Drug Administration is right on the verge of changing the e-cigarette business as we know it, and for more than just the obvious reasons. FDA regulation will not only alter how e-cigarette products and accessories look, but it will also set off a chain reaction that may cause many of your favorite brands to disappear off the store shelves.
In April of 2014, the FDA proposed a rule to add e-cigarettes to the list of products covered in the Federal Food, Drug & Cosmetic Act (FD&C Act). If the rule is finalized as it was proposed, e-cigarettes that are tobacco products would be subject to FDA regulation under the FD&C Act. This can mean a variety of things, which is why the FDA is hosting a workshop this December to tackle some of the larger issues that come with marketing, packaging and manufacturing products that comply with standards set by the FDA.
In order to properly regulate this new industry, one that has grown exponentially over the past few years, the FDA will need to create a whole new set of standards. The regulations for combustible tobacco products will not apply to e-cigarettes as it now stands, and the FDA has a lot of work ahead of them to enforce new regulations on this budding industry.
While it will be a lot of work, regulation is inevitable. The FDA will impose standards and require products to be approved, the question now is when will it happen and how much will companies be forced to do to comply. Of course packaging will be one of the preliminary areas of review, ensuring that products sold will include the proper warning labels. A shift in packaging will, of course, come at a cost, especially to the smaller companies who don’t have the financial backing for huge business changes.
However, this is not where the new regulations will truly have the ability to cripple the young companies that are just now taking a small foothold in the business. The FDA has specifically identified that with new regulation will come a mountain of paperwork, including a long process just for products to be reviewed for approval. The Consumer Advocates for Smoke-Free Alternatives Association estimated an average of 5,000 hours needed to complete an application for a product to be approved by the FDA, and a new application is required for each different combination of products. They estimate that only 25 products among the thousands that currently available would eventually be licensed.
The process to comply not only seems insurmountable, but the time it takes to be reviewed and approved could also prove devastating for young companies that cannot sustain a lack of sales while waiting for the process to complete. That is why many industry watchdogs assume that big tobacco companies are the only ones financially stable enough to survive the regulation nightmare that is looming.
In the meantime, the e-cigarette industry enjoys a sort of free market utopia, where small companies remain profitable and able to conduct business successfully. This enables the user to have greater choices in what they are vaping – more flavors, more device styles and overall more access to the enjoyability of the product. When regulation hits, it is likely we will see more and more of the mom and pop vape products disappearing from the shelves.
Big tobacco is already prepared for this, with many e-cigarette brands like Blu and Vuse already on the market. Phillip Morris just filed a patent this October for another device, one that connects via a USB cord, and seems poised to be the future of tobacco delivery products. The tobacco industry also has the financial means to buy out some of these smaller businesses, as they struggle to meet the FDA's new requirements.
This is incredibly scary for e-cigarette users, as it puts the future of vaping in Big Tobacco’s hands. Then the tobacco companies can manage their own idea of how people should transition from cigarettes to e-cigarettes, or perhaps end e-cigarettes as a product category entirely, if that’s better for their bottom line.
Regulation such as this would enable the tobacco industry to create a monopoly over the first new product that has come around that is even close to a threat to their business of selling tobacco. As per usual, the tobacco company doesn’t really seem concerned with the health benefits of e-cigarettes, simply about their financial gain.
The World Health Organization in their publication, “Tobacco Industry Interference with Tobacco Control,” has ascertained that “effective tobacco control and the commercial success of the tobacco industry are fundamentally incompatible.” In order to protect their interests the tobacco industry, “can be expected to seek to avoid, prevent, weaken and delay effective policies and programs, which are against its interests.” Gaining control of the e-cigarette industry seems the logical way to manage their potential profits, whether that lies in encouraging, or stunting, the growth of the e-cigarette industry.
Oliver Kershaw, the founder and CEO of E-cigarette Forum and the co-founder of Vaping.com, wrote an opinion article to CNN on the topic of big tobacco and FDA regulations. He writes: “All consumer products are regulated, and e-cigarettes should not be an exception. Consumers need to feel confident that they are purchasing safe, high-quality items. But the regulation of e-cigarettes needs to be proportionate and not discriminatory, especially considering the potential they offer for eliminating the scourge of tobacco-related diseases.” No one questions the need for regulation, but at what cost?
Kershaw is quick to remind people that, while regulation is necessary, it’s important to keep things in context. “If you start from the precautionary principal — treat something as bad until proved good — you miss the context that e-cigarettes are designed to replace one of the most dangerous consumer products invented.”
Regulation, whenever it comes, will clearly change the entire landscape of e-cigarettes as we know it. , As things are now, it seems imminent that Big Tobacco will take over, the question is to how much expense to the user?