Five Ways the FDA's New Regulations Will Transform the Vaping Industry

The Food and Drug Administration regulations will mean big shifts in the industry.

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May 5 2016, 8:50pm

Image: Alex R/Flickr

Dear vapers: you probably want to stock up on your favorite juice flavors, because under the new Food and Drug Administration regulations, they may not be around much longer.

The vaping industry was prepared for the FDA's final rules governing the manufacturing and sale of e-cigarettes, e-liquid, and other vaping products, which were released Thursday. Now, as companies start poring over the new rules to figure out exactly what is required, it's quickly becoming apparent that the market is about to undergo significant changes. That's not necessarily a bad thing: most of the the FDA rules are common sense and actually supported by the industry, like banning the sale of e-cigarettes to youth under the age of 18 and requiring childproof packaging on e-liquids. But it also means every vaping product must be registered through an expensive, time-consuming process called a Premarket Tobacco Application (PMTA) that will cost some companies millions, and push others out of business.

Good or bad, the vaping industry is about to look very different. Here are five ways the new rules will transform the vaping industry:

1) Prices will go up

It's still too early to say exactly how much prices might be affected, but it's likely the companies whose products remain on the market will have to bump up prices a bit. The FDA estimates the PMTA process will require 1,500 hours per product (that's every flavor and every nicotine level of e-liquid). Further, the process will cost "several hundred thousand" dollars per application, according to Mitch Zeller the director of the FDA's Center for Tobacco Products. The cost of registering multiple flavors of e-liquid will almost certainly trickle down to the consumer.

"That's always a possibility," said Jamie Zichterman, the owner of Mitten Vapors, a small e-liquid manufacturer based in Michigan. Zichterman said the company's lawyer is reviewing the new regulations to prepare to start filing PMTAs.

"It's like anything else. When you get a pizza one day and it's a couple more dollars, it's because the cost of cheese went up," Zichterman told me over the phone. "If it's the cost of doing business, sadly we'll have to [raise prices]. But we'll try to be as economical as possible."

2) Selection will go down

As expensive as PMTAs will be to file, many companies simply won't be able to justify the cost and will shutter. The FDA estimates it will only receive about 750 PMTAs each year and since companies only have the next two years to apply for their existing products, that works out to about 1,500 PMTAs. Keep in mind these are per product, not per company, and the FDA estimates there are more than 4,000 vape manufacturers in the US.

Keep in mind that most manufacturers produce dozens of flavors and nicotine levels. Take Apollo E-cigs, a popular manufacturer: it makes 12 different varieties just in its fruit flavor category, each with five different nicotine level options. Just to keep making all of its fruit flavors, Apollo would need to file 60 different PMTAs.

While the FDA said it will be looking for ways to reduce this impact—such as letting manufacturers file one PMTA for multiple flavors—it's inevitable that the market will shrink from thousands of flavors and products to fewer than 2,000 in the next few years. Manufacturers will be able to keep applying for new products in the future, but it will take a long time to crawl back to where we started out.

A display of e-liquids at a vape shop. Image: Ecigarettereviewed.com


3) Custom mods will go extinct

If you're not a vaper, you might think all electronic cigarettes are created equal, but there is a ton of variety for ways to get your vape on. You are probably familiar with the cig-a-like e-cigarettes sold at gas stations, which look like cigarettes, are completely sealed, and are disposable. But most vapers use vape pens or mods, which are reusable and can be customizable, allowing vapers to build their own unique units to their specifications.

Under the new FDA regulations, companies that sell the separate hardware vapers currently use to build their mods face a major headache trying to register all of the different parts. The regulations state that manufacturers will need to prove that every possible configuration of the different parts would still make a safe product, and notes that the "FDA expects that it may be difficult for manufacturers to make the showing necessary to meet the statutory standard, given the great extent of possible variations in combinations of hardware components." The regulations even discourage manufacturers from trying, and suggest only applying for closed-system models that are not customizable.

"We can't make policy at a national population level on the basis of hypothetical individuals."

4) A black market for vaping will emerge

The internet is a big place and there are lots of other countries that don't have vaping regulation pumping out e-liquid flavors. Though these products are, understandably, questionable, some vapers may opt to risk it if their favorite US-made flavors start disappearing. DIY juice makers might also start selling under the table to help fill the gap, and you can imagine the market for beloved flavors and mod parts that go extinct. There's no good scientific data on this question, but an informal poll of 1,651 readers on one vaping blog in the UK found that 66 percent said they would buy e-liquid on a black market if there was a ban, and it's been discussed in the online vaping community many times as regulation loomed. If people can find a way to buy guns and drugs online, they can definitely find a way to get their e-juice.

5) We will finally start getting some more vaping research

There's been lots of studies on the effects of vaping, on vaping as a tool to quit smoking, on teens' vaping habits—enough for public health agencies in other parts of the world to start embracing the technology. But the FDA isn't satisfied with any of the evidence so far, and that may well be a good thing for the industry. There's still a lot we don't know about vaping's personal and public health costs and benefits, because it just hasn't been around long enough for the experts to find out. Now that the FDA is tasked with regulating and monitoring the industry, it has already launchedseveral surveys and studies to start collecting data on this front.

"We can't make policy at a national population level on the basis of hypothetical individuals or anecdotal reports of benefit," said Zeller, of the Center for Tobacco Products, during a press conference. "We need to have enough evidence at a population level to make this net assessment. Finally these products are under the regulatory jurisdiction of the FDA and over time we will get answers."

The Royal College of Physicians in the UK recently put out a report calling for vaping to be promoted as a tool to quit smoking. The FDA isn't there yet, but maybe with more evidence, specifically focused on US vapers, it will get there.