Category: News This Week

  • Illicit Trade Conference

    Illicit Trade Conference

    The Institute of Law Studies of the Polish Academy of Sciences will hold a conference on Dec. 12 in Warsaw, Poland, about the illicit trade in tobacco products.

    During the conference, participants will present the outcome of a research project conducted under the PMI Impact initiative, which identified trends, mechanisms and required changes in the control of the illicit trade in tobacco products in the EU.

    Delegates will discuss issues such as the role of criminal law and intellectual property law, the impact of Brexit and the role of public-private partnerships in the combating illicit tobacco trade.

    The provisional agenda is available here.

  • Warnings Inching Closer

    Warnings Inching Closer

    The extended period to comment on the U.S. Food and Drug Administration’s (FDA) proposals for graphic health warnings ends today.

    The 2009 Family Smoking Prevention and Tobacco Control Act (TCA) directed the FDA to issue regulations requiring that cigarette packages and advertisements include new health warnings with text statements and color graphics depicting the negative health consequences of smoking.

    The original regulations published by the FDA in 2011 were challenged in court by several tobacco companies and vacated in August 2012 on First Amendment grounds.

    The agency has since reworked its proposed warnings and FDA officials think the current draft regulation and revamped photos will stand up to further First Amendment challenges.

    “The FDA believes the proposed warnings would survive judicial scrutiny because they advance the substantial government interest of promoting greater public understanding of the negative health consequences of smoking and are factual, accurate, and not unduly burdensome,” an agency representative told MedicineNet in an e-mail message.

    Following a lawsuit by public health groups, a judge in March directed the FDA to publish the proposed rule by August 2019 and issue a final rule in March 2020. The warnings would be required to appear on packages and in advertisements 15 months after a final rule is issued, which means U.S. smokers could be looking at graphic health warnings in 2021.

    As of Nov. 27., the FDA had received 288 comments to its proposed rule on graphic health warnings.

  • Track-and-Trace Guidance

    Track-and-Trace Guidance

    The Framework Convention Alliance (FCA) has unveiled the Guidebook on Implementing Article 8: Tracking & Tracing.

    The World Health Organization Framework Convention for Tobacco Control Protocol to Eliminate Illicit Trade in Tobacco Products came into force in September 2018 and aims to minimize the volume of illicit tobacco products smuggled across borders.

    By making tobacco products more accessible and affordable, illicit trade negatively affects public health and healthcare expenditure, according to the FCA.

    Among other requirements, the protocol calls for the creation of a cross-border tracking and tracing system for tobacco products.

    The guidebook provides an overview and historical context of the protocol and offers guidance on how policymakers can choose an appropriate track-and-trace system for their jurisdiction.
    Source: Framework Convention on Tobacco Control

  • Leniency for Safety Changes

    Leniency for Safety Changes

    The U.S. Food and Drug Administration (FDA) will not enforce violations of its premarket review requirements relating to limited safety modifications to tobacco products on the market as of Aug. 8, 2016, according to a new guidance issued by the agency.

    Titled Compliance Policy for Limited Modifications to Certain Marketed Tobacco Products, the guidance pertains to battery-operated tobacco products modified to comply with the voluntary industry UL 8139 battery standard and nicotine e-liquids modified to comply with the restricted-flow requirements set out in the Child Nicotine Poisoning Prevention Act (CNPPA) of 2015.

    The FDA, the U.S. Consumer Product Safety Commission and global certification company UL worked together to develop a voluntary industry standard, UL 8139, to help manufacturers mitigate potential battery-related risks associated with their battery-operated tobacco products.

    The FDA said it recognizes that to comply with the battery standard and the CNPPA, manufacturers may need to change certain aspects of their products, which may render their products as new tobacco products.

    The compliance policy provides that the FDA does not intend to enforce violations of the premarket review requirements of products that were modified to comply with the UL 8139 or the CNPPA.

  • Jobs at Risk

    Jobs at Risk

    More than 150,000 jobs would be lost in the independent U.S. vapor industry if the Trump administration moves forward with a ban on flavored vapor products, according to a study released by the Vapor Technology Association (VTA).

    Compiled by John Dunham & Associates, the report analyzes sales of flavored vapor products in the independent vapor distribution chain and finds that approximately 91.6 percent of sales of vapor products are flavors other than tobacco (with 85.7 percent being other than tobacco and menthol).

    Dunham concludes that “if a flavor ban was implemented, the independent vapor segment of the market would cease to exist in any meaningful way since the vast majority of the 13,480 independent vapor shops in the country (which currently generate 58,430 full-time equivalent jobs) would likely have to close. No business can continue to exist were it to lose 90 percent of its revenue.”

    According to Dunham’s analysis, a federal flavor ban would result in the elimination of over 151,850 jobs, decimating the independent vapor products industry. In addition, he said that a federal flavor ban would have an adverse impact on the U.S. economy by causing sales to fall by “about $8.4 billion, and the overall economy would see a $22.4 billion hit.”

    The VTA argues for methods that tackle youth vaping without eliminating the independent vapor distribution chain, such as a higher minimum purchase age.

     

  • Softening Flavor Stance

    Softening Flavor Stance

    

    U.S. President Donald Trump appeared to soften his position on banning flavored vapor products during a meeting with stakeholders on Friday, citing concerns about black market sales, according to reports in The Wall Street Journal, The Washington Post and USA Today.

    “If you don’t give it to them, it is going to come here illegally,” he said during a “listening session” at the White House that included vapor industry leaders, public health advocates and others on policies to address a surge in underage vaping.

    Trump said that instead of legitimate companies “making something that’s safe, they are going to be selling stuff on a street corner that could be horrible.”

    “Now instead of having a flavor that’s at least safe, they are going to be having a flavor that’s poison,” he said.

    Trump announced a ban on flavored e-cigarettes in September in response to growing youth vaping. The administration had been expected to release details on the ban earlier this month, but it was delayed following pushback from conservative interest groups, vapor industry advocates and e-cigarette users, who warned about job losses, illicit sales and the risk of vapers taking up smoking.

    Pro-vaping organizations have also been publishing surveys showing that vaping is popular in key states Trump needs to win reelection.

    During the Friday meeting, Trump reiterated his support for raising the minimum age to purchase e-cigarettes and tobacco products to 21 from 18, a move backed by e-cigarette maker Juul Labs and other companies.

    Vapor industry representatives put forward alternatives to an outright ban, such as advertising limits, an end to online sales, requiring e-cigarettes to be kept behind the counter or restricting their sale to adult-only stores.

    Anti-tobacco advocates pleaded with Trump to stick with the flavor ban, saying bright students were failing out of school because of their nicotine addictions.

    According to The Washington Post, the Friday meeting resembled a public policy version of the reality TV show “The Apprentice,” during which industry and government representatives occasionally shouted at each other in order to persuade Trump.

    Among those on the guest list were Juul Labs CEO K.C. Crosthwaite and two executives of the largest U.S. tobacco companies, Altria CEO Howard Willard and Reynolds’ Joseph Fragnito.

    Other invitees included Gregory Conley, president of the American Vaping Association, and Tony Abboud, executive director of the Vapor Technology Association.

    Health leaders who attended included the Campaign for Tobacco-Free Kids president, Matt Myers, the American Academy of Pediatrics president-elect, Sally Goza, and the American Lung Association president, Harold Wimmer.

    Conley said afterward that the president “seemed to understand that prohibition is not the only option.”

    “He cares a lot about youth and keeping them away from these products, but there [are] the jobs issues and the adult cessation issue that is clearly weighing on his mind,” Conley said.

    Gary LeRoy, president of the American Academy of Family Physicians, noted that the sides were far apart on such issues as the value of vaping to wean adults off of cigarettes but said all sides seemed to agree that vaping “has no place for young adults below the age of 21.”

    A transcript of the listening session is available here.

  • Embracing Dialogue

    Embracing Dialogue

    U.S. President Donald Trump will meet with vapor industry representatives, medical associations, advocacy groups and state officials on Friday to discuss the ongoing vaping crisis, reports USA Today.

    The meeting will give the administration a chance to hear from “a large group, representing all sides as we continue to develop responsible guidelines that protect the public health and the American people,” said White House spokesman Judd Deere.

    The gathering comes more than two months after Trump said he would ban flavored vapor products other than menthol and tobacco.

    Health advocates have criticized Trump for bowing to political pressure. Industry groups and conservative activists have warned the president that banning flavored e-cigarettes might trigger a political backlash, potentially costing him the 2020 election.

    Greg Conley, president of the American Vaping Association, described Trump’s lack of action as “at least a temporary victory.”

    As of Nov. 13, the Centers for Disease Control and Prevention (CDC) reported 2,172 vaping-related injuries and 42 deaths. The CDC has linked the injuries to vitamin E acetate, used as a thickening agent or to dilute THC oil in vape cartridges.

  • Branching Out

    Branching Out

    George C. Freeman III

    Universal Corp. will acquire FruitSmart, an independent specialty fruit and vegetable ingredient processor serving global markets.

    “Since outlining our capital allocation strategy in May 2018, we have been identifying a pipeline of strategic opportunities in adjacent markets around our core strengths: leveraging our highly localized rural infrastructure to source and process high-value, noncommodity, semi-perishable varietals from a large, reliant grower base for customers who demand fully traceable and compliant inputs,” said George C. Freeman III, chairman, president and CEO of Universal Corp.

    “Given the worldwide addressable market opportunity for fruit and vegetable sourcing and processing and the similar supplier dynamics and scale benefits to our existing business, this transaction represents a foundational step in building out a broader agri-products services platform and has the potential to be a new source of growth to drive future value creation for our shareholders,” he added.

    Universal anticipates the acquisition to be accretive to earnings the first fiscal year following closing. The company believes businesses in adjacent industries could represent at least 10 percent to 20 percent of earnings in the next five years.

  • Warning Against Overproduction

    Warning Against Overproduction

    The Tobacco Board of India has asked farmers to refrain from growing more than the authorized crop among indications that tobacco production might reach 100 million kg in the Prakasam and Nellore districts, reports The Hindu.

    Board chairman Y. Raghunatha Babu said that the farmers, in their own interest, should restrict themselves to growing the crop in the permitted acreage so that they could take advantage of the supply and demand situation at the time of marketing.

    “Overenthusiasm now will mean that they will have to burn their fingers at the time of marketing and paying penalty for the excess crop,” he cautioned.

    Regulators have authorized a crop of 86 million kg for the upcoming growing season.

  • Policy Shift Detected

    Policy Shift Detected

    Tobacco stocks increased Wednesday after investors noticed that the U.S. Department of Health and Human Services fall 2019 agenda makes no mention of a nicotine product standard, according to a report by Barron’s.

    The U.S. Food and Drug Administration (FDA) has been mulling over a plan to lower nicotine in cigarettes to minimally addictive or nonaddictive levels. In March 2018, the agency issued an advance notice of proposed rulemaking. The FDA is currently reviewing public comments to its proposal.

    Earlier this year, analysts at Morgan Stanley said profits for major U.S. tobacco companies could be cut in half if the FDA adopts a “maximum nicotine” rule, describing the policy as a potential game changer for the U.S. cigarette industry.

    By omitting the standard in the fall agenda, some observers felt the FDA could be open to a gradual nicotine reduction, which it had earlier said could lead smokers to simply compensate for the lower nicotine levels.

    “This is clearly good news for the tobacco industry: Effectively, the nicotine standard is no longer on the ‘to-do’ list,” said Nico von Stackelberg, an analyst at broker Liberum.

    FDA spokeswoman Stephanie Caccomo said the omission doesn’t mean the agency does not consider the regulations priority or that it would discontinue work on their development.