January 2017

Staring at the Ticking Clock A Recap of 2016 and a Glance at Things to Come

By Chris Mellides

When the Food and Drug Administration (FDA) announced its proposed rule to extend its regulatory authority to include vapor products back in 2014, those that were wise enough noticed that trouble loomed just around the corner.

The day would come when the vapor product industry would have a powerful government agency to answer to, and yet things generally chugged along unabated, and it was business as usual for many vape vendors and members of the vaping public.

Then May 5, 2016 arrived, and with it the FDA finally released its deeming regulations in the form of a 499-page document asserting that vapor products, along with cigars, hookah and pipe tobacco, were all considered to be in the same category as cigarettes and therefore subject to regulation under the Family Smoking Prevention and Tobacco Control Act.

The language in this final rule was very similar to the version announced in 2014, and the first wave of regulations was scheduled to go into effect Aug. 8, just 90 days following publication of the deeming regs.

Suddenly, everybody from big name manufacturers to small mom and pop vape shops and the customers that frequent them began to wonder just how bad things could get for an industry that allowed many to achieve success in small business and allowed countless others to finally kick their nasty smoking habits.

Provisions that took effect Aug. 8 affected vape shops and how small business owners and their employees had to conduct themselves.

There was to be no sale to people under 18 years of age, whether in person or online, with age verification required. There could also be no more distribution of free samples, and no vending machine sales would be permitted nationwide. Additionally, vape shop employees were discouraged from troubleshooting

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the devices of their customers, and speaking about vaping as a safer alternative.

This has caused concern among those vape shop employees, the majority of whom feel that their free speech is being stifled and that they are not permitted to educate their customers on proper product use or the health benefits that vaping has over smoking for fear of breaking the law.

Arguably, the most alarming provision outlined in the FDA’s deeming regs was that manufacturers

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would have to apply for authorization to continue to sell products not on the market before Feb. 15, 2007, which is considered the grandfather, or predicate date.

Any new products released after the predicate date, which accounts for the majority of vaporizers, e-liquid and various other accessories currently on the market today, would have to meet very rigid requirements. Among them, showing indisputable proof that their products benefit public health and other stipulations that most businesses operating within the vapor product industry consider to be unreasonable standards that simply cannot be met.

These companies would have to file a premarket tobacco product application (PMTA) with the FDA for new products released after Aug. 8, with each application costing hundreds of thousands of dollars with no guarantee of approval. This has caused stagnation across the industry with a market freeze currently in effect.

Aug. 8, 2018 is the final cutoff date for PMTA submissions for all vapor products that were brought to market after Feb. 15, 2007. Products may remain on the market for one additional year, or until the FDA denies their applications.

In the meantime, state and local governments have exacted their own authority by implementing new excise or “sin taxes” on vapor products, along with signing off on indoor vaping bans. Seen in states like Minnesota and North Carolina and Pennsylvania, Alabama and Louisiana respectively.

And in California the controversial Proposition 56, which will be appearing on the Nov. 8 ballot, has the potential to raise the state’s tobacco tax for the first time in almost 20 years, creating a heavy burden on the vapor industry there. It’s ultimately up to the voters to decide.

The industry has fought back though, with lawsuits challenging the FDA’s authority over vapor products from companies like NicoPure Labs and Lost Art Liquids, further demonstrating a sense of urgency resonating within the industry.

But the uphill battle to sway public policy by convincing politicians to see what has been overwhelmingly shown in studies that vaping is 95 percent less harmful than combustible tobacco, is a hard pill for our elected officials to swallow. Especially since the debate isn’t really over scientific proof, but rather money instead.

We now have a smoking alternative that if given room to stretch its wings could wipe traditional tobacco use off the face of the globe. But for supporters of the status quo, disruptions like the introduction and widespread use of vapor products as cigarette sales spiral further down the toilet, is not something that can be tolerated.

Looking at 2017, it’s fair to say that the period of stagnation with regard to innovation and product arrivals is destined to continue, much to the dissatisfaction of modders, e-liquid manufacturers and especially consumers.

I think we will see more states putting the screws to shops in the form of sin taxes, including taxes on wholesale, and there will be more disillusioned adult smokers that may have found vaping to be a viable option, but as prices have gone up, will stick to old habits instead.

What I hope to see in 2017, is that vapers don’t simply give up. It may be a lesson in futility, but strong organization, and support in advocacy efforts is a must. Stay informed, continue to educate and support local vendors, but most importantly, remain resolute. Unless you bring the fight to those wishing to snuff out the industry you care about, you won’t have any turf of your own left to stand on.