Vape Regulation Is Coming, and It Just Might Kill the Industry
The future of the US vaping industry is pegged to one grandfathering date.
The vaping industry in America is on a precipice, staring down a fast-approaching but uncertain future. In October, the Food and Drug Administration filed its final regulations to the White House Office of Management and Budget, the eighth step in a nine-step process to regulate electronic cigarettes that started more than four years ago.
These final regulations aren't public yet, but vapers are worried that if the rules are anything like the proposed regulations the FDA put out last year, the industry could be in trouble. The major concern circles around one thing: a grandfathering date that determines which products can stay on the market, and which would face regulatory barriers so high, some vaping advocates say it would kill the business.
"This date could destroy the industry," said Gregory Conley, the president of the American Vaping Association, a nonprofit advocacy group.
Just a few possibilities remain that could alter that date and tip the scales between two potential futures: the beginning of a new, more-structured market for e-cigarettes, or the veritable death of vaping on US soil.
It took a lot to get us here. With the passing of the Family Smoking Prevention and Tobacco Control Act in 2009, the FDA's purview over tobacco products in the US was broadened and strengthened. That same year, the FDA was making moves to stifle the budding vaping industry: seizing imported e-cigs at the border as "unapproved drug delivery devices," and warning the public not to vape. After a legal battle by the handful of vaping companies that existed at the time, a federal appellate court ruled in 2010 that the FDA couldn't ban and seize e-cigs. If the agency wanted to regulate vaping, it would have to treat e-cigarettes like any other new tobacco product.
A year went by without much word from the FDA. Then in April, 2011 the FDA announced it would treat e-cigarettes like a new tobacco product, and that meant formally adding them to the list of controlled items—a process known as "deeming regulations," because the FDA is literally deeming e-cigarettes a tobacco product. At the moment, the FDA only regulates cigarettes, roll-your-own tobacco, chewing tobacco, and snuff. Cigars, pipe tobacco, and newer products like e-cigs, vape pens, and e-liquids are not currently regulated, but are all in the process of being added to the list.
In the following three years, there was much speculation over what these new rules would look like. Then, in April 2014, we got a glimpse. The FDA released proposed regulations that included required warning labels on vaping devices, prohibiting sales to minors, and banning free sampling. After the proposed regulations were published, the FDA opened up a public comment period. Since then, it's reviewed the feedback and written up final regulations, which are secret, and sent those to the OMB. The OMB now has 90 days (or more, at its discretion) to review and approve or adjust the final regulations before they move on to the final step and become official. Basically, it's all over but the crying.
While there's some debate over the minutiae of the regulations, the vaping industry's main concern is with the grandfathering date.
"The news media writes about minor bans and sampling and product bans and all that stuff," Conley told me over the phone. "That's all fine and good. Nobody cares. It's the grandfather date that would destroy this industry and even make it difficult for Big Tobacco to keep their products on the market, let alone companies with anything less than a few million dollars a year in revenue."
The proposed regulations dictate that tobacco products that were commercially marketed in the US prior to February 15, 2007 are allowed to stay on the market without taking any action. So let's say you're a pipe tobacco manufacturer that's had your product on the market since January 1, 2007. You don't have to do anything special to keep selling your stuff. All you have to do is comply with the new regulations (so maybe changing the label, for instance). But if you have a product that hit the market after February 15, 2007, you have some hoops to jump through.
One option is the "substantial equivalence" pathway. This is for products that are essentially the same as grandfathered products, that are so similar the difference is negligible (think of the difference between a cigarette with a brown filter and a cigarette with a black filter, for instance). But since there were basically no vaping products on the market in 2007, hardly any of the ones around today would qualify for this option.
"None of them have a chance in hell"
The other option, and the thing that has the vaping industry shaking in its boots, is called a Pre-Market Tobacco Application. Companies would have a two year grace period where they could keep selling, to give them a chance to get an PMTA filed. After that point, if they hadn't filed an PMTA, their products will be banned from the market until they file one. Companies would need to file an PMTA for each vaping product—every e-cigarette, every flavor of e-liquid—a process that even the FDA estimates would cost millions of dollars and take thousands of manhours to complete. It's a hill that many small vaping businesses say would simply be too steep to climb.
"The FDA estimated there are about 1,600 products on the market and that it would receive 25 to 75 PMTA: that's 98.5 percent of the market banned after the first two years," Conley said. "And when you add in the rest of the small businesses out there, none of them have a chance in hell of filing a successful PMTA. We're talking about prohibition. We're not talking about regulation."
But other groups think the regulations don't go far enough. Vince Willmore, the vice president of communications for the Campaign for Tobacco-Free Kids, told me having the grandfather date exclude so many vaping products is a good thing, because none of them have ever been formally reviewed.
"If you changed the grandfather date, it would basically exempt the huge assortment of flavored e-cigarettes and cigars that have been introduced from FDA review to determine whether these products appeal to kids or not," Willmore said. "We think it's critical that the FDA be able to review these products and determine their impact on public health and especially their impact on kids."
The flavors are a big sticking point for many public health groups. On one hand, at least one study backed up the common argument among vapers that a variety of flavor options makes it more likely that ex-smokers will stick to e-cigarettes. On the other, vaping is increasing in popularity among teens and middle-schoolers, and nicotine poisoning from kids accidentally ingesting e-liquids is on the rise.
The major crux of the debate is the fact that, because vaping has only been around for a short time, we don't know the long-term effects. Early evidence shows vaping is safer than smoking, but it's not as safe as just breathing clean air. And the chemicals used in flavoring e-liquids could have potentially dangerous side effects.
"We know that tobacco is going to kill you, but we are finding people are having incredible success with tobacco-free alternatives such as vaping," said Tony Mandarano, founder of ZampleBox, a vaping subscription start-up. "Vaping isn't like taking a vitamin, and nobody is saying that. It's about harm reduction."
For now, the vaping industry is holding on to hope that one of three things might happen: we find out the FDA voluntarily changed the grandfather date in the final regulations ; the OMB requires the FDA to change the date; or a congressional bill that changes the date for the FDA will pass. If none of those options come through, the future of the vaping industry in the US will be seriously threatened.
As one poster on a vaping subreddit succinctly put it: "if this is true and what will be finalized, we are truly fucked."