A new study has found that flavor bans boost sales of traditional combustible cigarettes. The study, E-Cigarette Flavor Restrictions’ Effects on Tobacco Product Sales, concluded that restrictions on the sale of flavored nicotine vaping products could lead to significant increases in traditional cigarette sales.
Given that combustible cigarettes are widely recognized as more harmful than vaping, the study’s findings raise pressing questions about the public health implications of such policies, according to a release from the Canadian Vaping Association (CVA). The group “urges Canadian governments to review the study’s findings and ensure that vapor product regulations are in line with harm reduction and Canada’s Drugs and Substances Strategy.”
Key highlights from the study include:
Substitution to cigarettes: For every 1 fewer 0.7 mL pod sold due to flavor restrictions, there’s an increase of 15 additional cigarettes purchased.
Rise in cigarette sales over time: While the short-term effects are less clear, the long-term correlation between vaping flavor policies and a surge in cigarette sales is robust. This surge occurs especially when such policies have been in place for a year or more.
Young population at risk: The relation between vaping flavor restrictions and increased cigarette sales isn’t limited to a particular age group. Alarmingly, there’s also a surge in sales for cigarette brands popular among underage youth.
The research firmly underscores the unintended consequences of restricting flavored product sales, according to the CVA. While the research indicated that these policies do achieve their goal of reducing flavored product use, they inadvertently boost the sales of traditional cigarettes across all age groups.
Given the stark difference in health risks between cigarettes and vaping, the study contends that the overall health benefits of such policies may be minimal or even potentially harmful in the broader perspective.
Philip Morris International unveiled a zero-tobacco stick for use with its heat-not-burn device IQOS, which may help the company avoid tax and other regulations that affect its tobacco products in some markets, according to Reuters.
The new sticks, called LEVIA, do not contain tobacco but rather a “nontobacco substrate” infused with nicotine. It offers flavors including tobacco, menthol with blueberry and peppermint.
LEVIA may avoid the heavy taxes or other controls imposed on other tobacco products, according to CEO Jacek Olczak. He said it “may not be subject to flavor regulations in some jurisdictions” and that it “doesn’t fit” in existing fiscal categories.
A PMI spokesperson declined to comment on when and where LEVIA would launch or what substance replaces the tobacco.
The U.K. Vaping Industry Association (UKVIA) has announced that it is launching a new web-based information hub, as well as a special Sustainable Vaping Week campaign during October, designed to get vapers, the vaping industry and those outlets that sell vapes to act now for the benefit of the environment.
While the sector is making progress in limiting its impact on the environment, including the development of more recyclable product innovations and the introduction of collection schemes, a recent report by Material Focus highlights that some 5 million single use vapes are thrown away each week, according to a UKVIA release.
The new resource hub and week-long campaign will provide vapers with information on the dos and don’ts of recycling single use vapes as well as access to locations where they can dispose of their devices in an environmentally considerate way. Retailers and other outlets, such as pubs and clubs, will also be able to download educational resources to educate their customers about recycling single use vapes across the week and throughout the year.
There will also be guidance provided for those responsible for producing, importing, distributing and selling vape devices to ensure they are operating legally at all times when it comes to meeting environmental regulations and are working closely and effectively with reputable waste management companies.
“There have been calls for the banning of single use vapes in part due to their environmental impact,” said John Dunne, director general of the UKVIA. “However, a ban is not the answer—firstly disposable vapes are proven to be hugely effective in getting smokers to switch from their habits to considerably less harmful vapes, due to their ease of use, convenience and low entry price points. They are the main reason why smoking is currently at record low levels across the U.K. In addition, through the collective efforts of a range of stakeholders, we can reverse the current impact on the environment arising from vapers throwing them away.
“The initiatives we are announcing will play a key role in this process by educating vapers about how they can play a critical role in being environmentally considerate when disposing of their vapes. They will also give much needed guidance to the vaping industry and other sectors, such as hospitality and general retail, about what they need to be doing to support the collection of vape waste, thereby enabling significantly higher recycling rates than we are currently seeing for these devices.”
The Sustainable Vaping Week will take place beginning Oct. 16, following International E-Waste Day on Oct. 14. The resource hub will become a permanent source of information on vaping and the environment.
The UKVIA will be providing a range of content for all of its members and the wider industry to promote and share via their offline and online retail stores as well as through their communications channels to educate vapers about how they can make a positive difference to the environment as a result of changing their throwaway behaviors.
Malawi’s Tobacco Commission has extended tobacco farmer registration and licensing to Oct. 31, 2023, according to The Nyasa Times. The end date was originally scheduled for Sept. 30, 2023.
“We have decided to extend the exercise by one month, giving enough period to them [stakeholders and growers] without charging any fee or penalty to them,” said Tobacco Commission CEO Joseph Chidanti Malunga.
The Tobacco Commission wants farmers to produce as much tobacco crop as possible because there is more demand for higher volumes from traditional and international buyers.
It is illegal in Malawi for farmers to grow tobacco without being licensed.
Will the European Union enable or obstruct the market-based demise of the cigarette?
By Clive Bates
There are so many genuinely terrible ways to regulate combustible tobacco and smoke-free nicotine products that achieving one of the less terrible ways is a triumph. Unlike the United States, the European Union hasn’t imposed gigantic regulatory burdens that choke the life out of all but the largest companies, relentlessly favoring tobacco majors over their smaller rivals. Unlike Australia, the EU pulled back from regulating vapes as if they were medicines. Australia was once a leader in tobacco control, but now it has become a chaotic fiasco of sluggish declines in smoking and a massive black market. Despite the prohibition campaigns of the World Health Organization, the EU has resisted most forms of prohibition, though with the inexplicable exception of snus. To state the obvious, prohibition doesn’t cause banned products to disappear; it merely removes law-abiding suppliers and hands the residual market to criminals and unregulated informal traders.
In contrast, the EU has developed a range of measures to address tobacco and nicotine risks that are not especially disproportionate or discriminatory, reasonably precautionary and not particularly prone to harmful unintended consequences. As a result, the EU has a diverse range of lawfully available safer alternatives to smoking and, therefore, the regulatory basis for tobacco harm reduction for the member states that wish to pursue it. By international standards, it is a modest success.
European elections will be held in June 2024, and a new legislative program will emerge a few months later, with the most intensive legislative activity expected in 2025. So, the question is where next? I am sorry to report that the Brussels hive mind of bureaucrats, politicians and interest groups is on course to turn a modest success into a conspicuous failure, putting millions of lives at risk.
The EU’s Public Health Aims are Focused on Reducing Disease
There is a renewed impetus behind EU tobacco policy. In 2021, the EU launched its plan for addressing cancer, Europe’s Beating Cancer Plan. In 2022, it launched a separate plan for addressing noncommunicable diseases other than cancer, known as Healthier Together. Both place considerable emphasis on tobacco, and both stress the “tobacco-free generation” objective to reduce tobacco use to less than 5 percent of adults by 2040 compared to around 25 percent today.
Regulatory Instruments
To deliver this agenda, the EU has three main instruments to regulate tobacco and related products, such as e-cigarettes. These are in the form of “directives,” or legally binding agreements that member states will implement in domestic legislation that complies with the terms of the directive.
The Tobacco Products Directive (TPD: 2014/40/EU) governs standards for products, packaging, warnings and several aspects of commerce in tobacco products. This directive also provides for the regulation of e-cigarettes, including advertising and promotion of these safer alternatives. The TPD is under active review following an evaluation of the legislative framework for tobacco control, and a new European Commission (EC) proposal is expected late in 2024.
The Tobacco AdvertisingDirective (TAD: 2003/33/EC) bans tobacco advertising, promotion and sponsorship with a potential cross-border reach. Member states control fixed advertising, such as billboards. The TAD will likely be revised alongside the TPD to create a unified approach to tobacco and related products, such as e-cigarettes.
The Tobacco Excise Directive (TED: 2011/64/EU) provides a framework for harmonizing tobacco tax design. Member states generally set the levels of excise duty but are subject to minimum levels set in the directive. The TED has been subject to a lengthy review process since 2016. Taxation matters are sensitive with the member states, and each has a veto on any proposals. Controversy struck on Dec. 7, 2022, when new proposals were pulled from publication, as several Eastern European nations noticed that it would create large increases in tobacco prices for them.
The EU, as a party to the Framework Convention on Tobacco Control, will also form a common position to take into the November negotiations at the 10th Conference of the Parties to the Framework Convention on Tobacco Control in Panama. By endorsing the positions of the WHO, the EU will build momentum for further regulation aligned with the WHO approach.
The EU also has a range of softer instruments, such as the nonbinding 2009 Council Recommendation on Smoke-Free Environments (2009/C 296/02). In July 2022, the EC issued a call for evidence for a proposal for an updated recommendation that would apply to heated-tobacco products and e-cigarettes.
The Outlook is Bleak
It is never easy to see the big picture in the EU through the relentless blizzard of initiatives, consultations, reports, working groups and statements. However, some disturbing developments are emerging.
First, the major error of strategy. The EC sees the newer tobacco and nicotine products (heated tobacco, pouches, e-cigarettes) as a threat rather than as an opportunity to reduce cancer and NCDs. There is no sign that it recognizes or is interested in exploiting the radically different risks to health posed by smoked and smoke-free products. It should be treating tobacco products differently and proportionately according to risk. However, it is moving in the opposite direction toward treating all tobacco and nicotine products as if they were cigarettes. The effect will be to protect the cigarette trade, promote smoking, slow the decline of serious diseases and nurture the criminalization of supply and workarounds.
Second, instead of reversing the absurd and indefensible ban on snus, rumors suggest that the EC may even try to extend this ban to nicotine pouches. Snus has already reduced adult smoking in Sweden to close to the EU’s 2040 tobacco-free target of 5 percent, with measurable improvements in cancer and cardiovascular outcomes. Encouraging “free movement” of pouches would build on the snus proof-of-concept and help to reduce smoking across the EU. Regulation of purity and total nicotine density in pouches makes sense. However, a ban will simply deny users a significant harm reduction opportunity and create an influx of illicit high-strength pouches.
Third, there are moves to extend the ban on characterizing flavors in combustible tobacco products to all nicotine products. The EC has already done this for heated-tobacco products and could extend severe ingredient restrictions to vaping products. The government of the Netherlands, in alliance with the public health agency RIVM, has adopted a “whitelist” approach of permitting a few ingredients used chiefly to make artificial tobacco flavors. If adopted by the EU, this system would radically constrain the legal vaping market in which consumers are drawn to the diversity and ever-changing range of flavors as an alternative to smoking. At a December 2022 conference presentation in Paris, an RIVM official, Reinskje Talhout, presented on the Netherlands’ approach. After 33 pages of detailed analysis showing how to create a (short) list of permitted ingredients, she included the following slide on “Possible unintended consequences.”
The challenge is well summarized on this slide. Yet the advocates of broad flavor bans have no response. They have largely ignored the malign market and behavioral dynamics that they are likely to unleash.
Fourth, changes in the excise regime will dull the consumer economic incentives to switch from high-risk cigarettes to low-risk, noncombustible products. The minimum tax levels envisaged in leaked proposals are far greater than would be implied by the difference in risk compared to cigarettes. If the excise regime were more proportionate to the risk, the tax take would be outweighed by the costs of tax administration, and it would barely be worth raising excise duties. Member states should insist on their right to set zero minimum taxes on noncombustibles as it is their right to pursue tobacco harm reduction domestically. There would also be a scope for setting maximum tax levels for safer products to maintain a material difference in taxation between the highest-risk products and lowest-risk products.
Fifth, the EC plans to make it harder for European citizens to learn of safer alternatives to smoking by imposing further controls on advertising and promotion and possibly to willfully mislead consumers with packaging and warnings that implicitly exaggerate the risks of low-risk alternatives to smoking. Again, the regulatory tactic is to treat all products as if they are as harmful as cigarettes when what is required is more nuanced risk communication. If the EU follows the direction of the WHO, it will risk drifting into inappropriate restrictions on free speech and legitimate opinion.
The question for me is why? What fearful autocratic reflex causes the EC to suppress pro-health innovation and see opportunity as a threat? There is an opportunity here for the free movement of goods and services within a well-functioning internal market to deliver a high level of health and consumer protection. The internal market, if allowed to function as intended, could end the cigarette era and epidemic of smoking-related disease. Yet its most ardent champion, the EC, appears unwilling to let the internal market crush the cigarette trade through the power of consumer preference, competition and creative destruction. What a pity.
Clive Bates is the director of Counterfactual Consulting and the former director of Action on Smoking and Health (U.K.).
Last week, lawmakers in the U.S. introduced the CARE For Moms Act in Congress. That bill would increase healthcare for expecting and new mothers, while also exponentially increasing the taxes for vaping, roll-your-own, cigars and other tobacco products.
The tobacco tax language in the CARE Act was copied and pasted out of the Tobacco Tax Equity Act, a bill that has been introduced as a rider in bills introduced in previous sessions of Congress but it failed to gain any traction, according to halfwheel.
That could change after Sen. Ron Wyden and Sen. Dick Durbin have now introduced the Tobacco Tax Equity Act of 2023 in the Senate as a standalone bill, while Rep. Raja Krishnamoorthi introduced the bill in the House of Representatives.
The tobacco tax-related language includes:
New taxes for e-cigarettes;
Doubling the tax on roll-your-own tobacco;
A more than 16x increase on pipe tobacco;
Doubling the tax on small cigars;
A massive tax hike for premium cigars;
For premium cigars, the language removes the existing federal excise tax of 52.75 percent, capped at 40.26 cents per cigar, and replaces it with a weight-based tax of $49.56 per pound.
Because it’s a weight-based tax, the difference between the existing tax and the new taxes would vary depending on how heavy the cigar is. For cigars robusto or larger, it would likely more than triple the current federal tax rate.
The premium cigar industry recently declared victory in the fight against oversight by the U.S. Food and Drug Administration. Celebrations may have been premature.
The lawsuit was filed by the Cigar Association of America, the Cigar Rights of America (CRA) and the Premium Cigar Association. The case focused in part on the rulemaking process, which requires the FDA to inform the public about upcoming regulations and solicit feedback on those proposed rules.
In last month’s decision in Cigar Association of America et al. v. United States Food and Drug Administration, Judge Amit P. Mehta made a sweeping, albeit expected, ruling that granted relief to the three cigar industry trade groups that sued the regulatory agency in 2016 on behalf of the premium cigar industry.
The news confirms industry fears that warning labels, premarket tobacco product application (PMTA) review of cigars and other limitations that have impeded the ability of cigarmakers are still a possibility.
Recently, the FDA acknowledged the decision and one of its impacts, telling cigar companies that it did not plan to assess user fees for “premium cigars” sold during Q4 FY23.
The Department of Justice, which represents FDA on legal matters, had 60 days to appeal the ruling. It’s unclear whether the agency will ask a court for a stay, which could reenact the deeming regulations for “premium cigars” as the appeal process works itself out.
Reynolds American Inc., the BAT Group’s U.S. subsidiary, broke ground on the WaterHub at the Reynolds Operations Center in Tobaccoville, North Carolina. The WaterHub is an advanced water recycling facility and product of a subsidiary of NextEra Energy Resources. Several city and state leaders, NextEra Energy Resources and Reynolds representatives and others involved in the WaterHub project gathered Thursday as Reynolds demonstrated progress on its commitment to excellence in environmental stewardship with the project’s official groundbreaking celebration.
Once construction is complete, the WaterHub is expected to reclaim more than 60 million gallons of water per year, equivalent to the annual water supply of approximately 550 average U.S. households. This installation aims to reduce Reynolds’ environmental footprint and conserve water in Forsyth County’s Yadkin Pee Dee River Basin.
“Through the WaterHub, we expect to reduce water withdrawn at the Reynolds Operations Center by over 40 percent, which in turn would reduce the water withdrawn across our global operations sites by approximately 6 percent,” said Bernd Meyer, executive vice president of operations at the Reynolds organization, in a statement. “We are doing our part in preserving precious natural resources, and today celebrates a significant investment and long-term commitment to environmental sustainability.”
The WaterHub at the Reynolds Operations Center will be one of the few projects of its size in the U.S. using advanced water reclamation technologies, allowing Reynolds’ operating facilities to reduce their dependence on potable water for factory utility operations.
“At NextEra Energy Resources, we are dedicated to offering innovative solutions that help businesses like Reynolds in achieving their sustainability and environmental responsibility objectives,” said Gary Morris, vice president of distributed generation for NextEra Energy Resources. “The WaterHub not only actively conserves water resources but also bolsters operational resilience.”
This project complements Reynolds’ work to use water efficiently across its operations facilities. The American Snuff Company facility in Clarksville, Tennessee, and R.J. Reynolds Tobacco Company Whitaker Park site in Winston-Salem, North Carolina, both recently earned Alliance for Water Stewardship (AWS) Certification. Reynolds’ Operations Center in Tobaccoville earned this AWS designation in 2022.
“The more things change, the more they stay the same,” is an expression that has been around for almost two centuries, and it speaks to the fact that the small picture(s) of life may change, but the larger one does not. The vape industry and all the challenges and changes that have happened in the past decade are totally contrary to that famous saying.
A decade ago, the vape industry was the epidemy of the Wild, Wild West, full of vape shops springing up on every corner, and any/everyone creating e-liquids in their bathtubs at home. Regulation and competition changed all that and brought some semblance of “orderliness” to the market, but as state and federal regulations bombarded the industry, and with the FDA creating onerous and unattainable guidelines, the vape space has truly become one of survival.
I recently attended a vape event in Phoenix which brought together several dozen top manufacturers, distributors, and buyers, and universally everyone lamented the same concern: business is down.
Why is business down?
The reasons are many, including strict regulations, and now, even more enforcement of those regulations, but overall, the cause was much simpler. The huge COVID-19 rebound in 2020-22 put more money in consumers’ pockets and more time on their hands. Those issues combined created an artificial bubble that many thought would last. But time has passed. Add in the inflation that has pushed up food and other cost of living expenses, and some former necessities are now becoming unaffordable luxuries.
“It’s a balancing act between the addictive nature of some nicotine products and the limitations of buyer’s budgets,” said Jamie Reed with Simple Vape Supply from Orange County California. “I’ve been in the industry for over ten years, and this is evolution in its purest form and based around ’survival of the fittest.’”
Simple manufactures and distributes over 100 different assortments of nicotine cartridges, including disposables, including various iterations of CBD, Delta-8 and Kratom.
“It’s interesting,” Reed added. “When I got hired, I was told that there was an ‘expiration date,’ and we all knew that this industry might not last, and that the cream would rise (to the top). We planned to be one of those surviving companies, and we’ve been able to adapt to the times.”
Her company, along with many that are still around, were mostly run by rebels, radicals, and envelope pushers; and many have in fact changed accordingly, but some have merely learned how to “play the game” and outwardly appear to be toeing the line, but the reality may be different.
“We were aware that the COVID blip was a one-time event. People were home, they had government money to spend, and no one was checking in on them or requiring any urine tests. The Delta (8,10) boom really added to that, and everyone jumped on that bandwagon,” she said excitedly.
That line of CBD was an example of how the industry has and continues to push back. The FDA says you can’t do this, so the industry says, “F-you, then we’ll do that.”
With regulation eliminating or reducing product selection, almost any industry will do the same thing: adapt; repurpose, or reposition.
Of the dozens of people I spoke with at the event, the numbers (from shop owners and manufacturers) were pretty consistent, and most of them were down 20 to 30 percent. Many were saying that purchase sizes were lower than normal and a typical ten-thousand-dollar order was now half that. They saw some shops closing, but most were working on smaller revenues.
Manager J-K Thorne holds some of the flavored products that are no longer available at Wild Impulse vape shop. (Shane Hennessey/CBC)
Meanwhile, on the other side of the equation, vape liquid manufacturers who are trying to “play the game” right and submitting premarket tobacco product applications (PMTAs) to the U.S. Food and Drug Administration are frustrated at the amount of time it takes and how much money is being thrown into a (seemingly) dark hole.
I spoke with one of the owners of a large vape manufacturing business and distribution company in Idaho, and he shared some facts and figures about their process of trying to make their products “legal.” Legal, in the eyes of the FDA, has caused his company to squander over $5 million in the past few years trying to get authorization.
Mike Larsen is a detailed and focused vape guy who has been in the industry for over a decade and is with Lotus Vaping Technology, which started in 2011. As a partner and director of sales, he is on the front line of everything the company does to stay legal and compliant and is riding the roller coaster ride on a daily basis.
“Disposables have really changed the game,” he said, “and they have reduced the role of vape shops where people used to come for education and guidance. Consolidations and closures have also reduced the shop numbers by 30 to 40 percent, and now you have larger conglomerates doing the work of the multitude of shops.”
We spoke about a possible flavor ban nationally, and he said he was skeptical.
“The PMTA process has already reduced or eliminated flavors, so it may not be necessary to go to that length. There have been between six and seven million submissions by thousands of companies, and so far, just 23 have been approved. I know of a few companies that submitted over a million applications themselves. And here’s the irony: everyone approved has been a Big Tobacco company, and they make up just a fraction of the total vaping market.”
The second irony on top of that, is that those so-called approved products are ones that no one wants.
We talked about whether those approvals were fair or were the result of favoritism and bias, and he smiled since we both knew the answer.
“When you look at the PMTA process and the rigid requirements, it seems pretty obvious that they were written to the advantage of the larger, established companies, and the “small guy” had very little chance in this skewed game. You can’t even budget for something like this,” he continued. “The original filing costs over a million dollars, and I know several companies that have put another ten million in, only to get denied. Who has deep pockets like that? In 2016 I could have named over 150 liquid companies doing good business; today I can name about three dozen.”
And that is why the number of companies manufacturing tobacco and vape products is half what it was and is getting smaller every year. The FDA changes the rules of the game continually.
“There’s something happening here, but what it is ain’t exactly clear,” is the beginning line of a song that speaks to changes going on in society. That song by Buffalo Springfield may have nothing to do with vape, but the message says the same thing: there is something happening here although it may be clearer than we realize. We all knew this would happen; it was predicted a decade ago.
In the vape space, the more things change…the more things change.
Norm Bour is the founder of VapeMentors and works with vape businesses worldwide. He can be reached at norm@VapeMentors.com.
The retailers selling illegal flavored disposable vapes are under scrutiny. The U.S. Food and Drug Administration issued complaints for civil money penalties (CMPs) against 22 retailers for the illegal sale of Elf Bar/EB Design.
The FDA previously warned each retailer in the form of a warning letter to stop selling unauthorized tobacco products, according to the agency. During follow-up inspections, the FDA observed the retailers had not corrected the violations, which resulted in the civil money penalty actions.
“The FDA has been abundantly clear that we are committed to using the full scope of our authorities, as appropriate, to hold those who break the law accountable,” said Brian King, director of the FDA’s Center for Tobacco Products (CTP). “These retailers were duly warned of what could happen if they failed to correct their violations. They chose inaction and will now face the consequences.”
The complaints seek the maximum civil money penalty of $19,192 for a single violation from each retailer. While the FDA has issued civil money penalty complaints to retailers for selling unauthorized tobacco products in the past, this is the first time the agency is seeking CMPs for the maximum amount against retailers for selling illegal flavored disposable vapes.
The retailers can pay the penalty, enter into a settlement agreement, request an extension of time to file an answer to the complaint or file an answer and request a hearing. Those that do not take action within 30 days after receiving the complaint risk a default order imposing the full penalty amount.
Courtesy: US FDA
In addition to the CMP complaints, today the FDA announced an additional 168 warning letters to brick-and-mortar retailers for illegally selling Elf Bar/EB Design products. These warning letters were the result of a coordinated nationwide retailer inspection effort conducted throughout the month of August, according to the agency.
Warning letter recipients have 15 working days to respond with the steps they have taken to correct the violation and ensure compliance with the law. Failure to promptly correct the violations can result in additional FDA actions such as injunction, seizure or civil money penalties.
“We continue to monitor closely all those in the supply chain, including retailers, for compliance with federal law,” said Ann Simoneau, director of the Office of Compliance and Enforcement in the CTP. “This includes follow-up inspections and surveillance of those who have received a warning letter, and taking additional action, as appropriate, to enforce the law.”
