Vape Regulations Are Pending, and Industry At Risk

The vaping industry is looking at a future that is anything but certain. Last month, FDA filed final regulations with the White House Office of Management and Budget. This is #8 in a nine-step process that will regulate e-cigs. The long march to regulation started in 2011.

The final regulations have not been released yet, but vapers worry that if the final rules resemble FDA’s proposed regulations, the entire industry could be at risk. The big concern is about the grandfathering date that will tell us which products are allowed to stay sold on the market and which are going to be so regulated as to be likely driven from the market.

How We Got Here

In 2009, the Family Smoking Prevention and Tobacco Control Act was passed, which gave FDA more authority over tobacco products in the US. FDA started to make moves to stifle the new e-cigarette industry, with its seizing of imported vaping products as unapproved drug delivery products. However, a federal appellate court stated in 2010 that FDA was not allowed to ban and seize the products. The court stated that FDA would have to treat e-cigs like a regular tobacco product.

Which is what the FDA did in April 2011, stating that it would add e-cigs to the list of controlled tobacco items. At the moment, e-cigs, e-liquids and vape pens are not regulated, but they are soon going to be.

FDA in 2014 released proposed regulations that included fairly minor items, such as mandating warning labels on all vaping products, banning sales to minors and eliminating free samples.

These regulations are not the issue. Rather the problem is with the grandfathering clause in the pending regs. The proposed regulations state that tobacco products that were on the market prior to Feb. 15, 2007 would be allowed to stay on the market without any action by the company. You would just need to comply with new regs, you may have change the label for example.

However, if you have a product that came on the market after that date, which is the entire e-cig industry, there will be regulatory hoops to go through.

One option is what is called the substantial equivalence method. This is used for products that are just about the same as products that are grandfathered, with differences so minor as to be indistinguishable. But there were no e-cigs on the market in 2007 so no one will qualify for this exemption.

The only other path would be for the e-cig companies to submit a Pre-Market Tobacco Application. The company would have a two year grace period where they can continue to sell the product so they can fill out and file a PMTA. After that, the vaping products would be banned until they have one filed and approved.

However, the company would have to do a PMTA for every single product – every type of e-cig, and every flavor of liquid. This would cost millions and taken thousands of hours to do. Most vaping companies could not afford it.

The vaping industry is hoping that FDA will change the grandfather date on the final regs or that the OMB will mandate FDA to change it. Another possibility is that Congress will pass a law that changes the date.

There is no question the vaping industry is at risk. What is going to happen is anyone’s guess at this time.

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