A congresswoman in Colorado, US, Diana DeGette, is introducing legislation that, if passed, would ban electronic-cigarette flavors on a national level, according to a story by Michael Nedelman for CNN quoting a Monday announcement by DeGette’s office.
The bill was expected to be introduced to the House of Representatives yesterday.
Nedelman described flavors as being at the center of the regulatory debate, with some people saying they were an important tool in getting adults to switch from combustible cigarettes, while others wanted to ban them entirely because in their view they appealed to young people and minimized how harmful and addictive vapes were perceived to be.
“To me, there is no legitimate reason to sell any product with names such as cotton candy or tutti fruitti, unless you are trying to market it to children,” DeGette, a Democrat, said in a statement on Monday.
“Most experts agree that the kid-friendly flavors that e-cigarette manufactures are selling with these products are one of the leading causes of this spike in use among our high school and middle school students.”
If DeGette’s bill becomes law, it will ban these flavors within a year unless companies can prove to the US Food and Drug Administration that flavors are not implicated in the rise in vaping among young people.
It would require companies also to show that flavors are instrumental in getting smokers to quit combustible cigarettes and that they don’t make vapes ‘more harmful to the user’.
The bill could ban flavors in cigars on the same timeline.
Tobacco smoking costs the Irish state 140 times more each year than the amount spent trying to get people to give up the habit, according to a story by Sarah Burns for The Irish Times and quoting the Irish Heart Foundation.
About €11.8 million was reportedly spent in 2017 on smoking cessation measures including medications, services, the national quit-line and media campaigns, while it was estimated that costs related to the impact of smoking totaled €1.65 billion.
These figures, which were based on a reply to a parliamentary question and an assessment of the economic cost of smoking in Ireland commissioned by the Department of Health, were published by the Foundation on National No Smoking Day.
The amount spent helping people to quit was less than one percent of the almost €1.4 billion smokers paid in tobacco tax during 2017, the Foundation said.
“Nowhere near enough is being done to help the estimated 80 percent of smokers who want to quit,” said Chris Macey, the Foundation’s head of advocacy. “Tax increases have played an important role in reducing smoking rates in Ireland but could be even more effective if a higher proportion of the proceeds was spent on cessation services.”
“It isn’t fair to place a large additional tax burden on people because of their addiction to nicotine and then fail to invest properly in helping them overcome it when many are desperate to quit.”
Macey said that putting more resources into smoking cessation services would help to reduce the number of deaths from tobacco-related illness in Ireland, which he said was 16 per day.
The CORESTA (Co-operation Centre for Scientific Research Relative to Tobacco) Secretariat has given details of the publications it has recently published and the projects it has launched.
The following documents have been published and can be downloaded from the Documents section of the CORESTA website at www.coresta.org.
Guide No. 5 “Technical Guideline for Pesticide Residues Analysis on Tobacco & Tobacco Products (includes Technical Notes)” updated
(2018-10-17) (AA-099-CTG-05)
Report “Inter-Laboratory Comparison Test Measuring Total NNAL in Human Urine”
(2018-11-13) (BMK-092-CTR)
Report “Study of the Short-Term Variability of Commercial Cigarettes through Select Cigarette Constituent Testing”
(2018-09-19) (CVAR-081-CTR)
Report “Study of the Medium-Term Variability of Commercial Cigarettes through Select Cigarette Constituent Testing”
(2019-01-09) (CVAR-082-CTR)
Report “4th Round Robin Test for Air Permeability Calibration Standards”
(2018-10-08) (PTM-022-CTR)
Report “13th Round Robin Test for Multi-Capillary Pressure Drop Calibration Standards (2017/2018)”
(2019-01-25) (PTM-159-CTR)
Report “11th Collaborative Study (2018) for Physical Parameters of Cigarettes and Filters”
(2018-12-05) (PTM-167-CTR)
Guide No. 4 “A User Guideline for the Measurement of Pressure Drop of Cigarettes and Cigarette Filter Rods” updated
(2019-01-11) (PTM-192-CTG-04)
Method No. 53 “Determination of Paper Wrapper Burn Speed” updated
(2019-01-29) (PTM-201-CRM-53)
Method No. 78 “Determination of Selected Phenolic Compounds in Mainstream Cigarette Smoke by HPLC-FLD” updated
(2018-12-05) (SMA-194-CRM-78)
Report “Collaborative Study on the Suitability of Certain Substrates for the Ignition Propensity Test According to ISO12863:2010”
(2019-01-10) (RAC-106-CTR)
Report “2018 Collaborative Study of CORESTA Monitor 8 (CM8) and 9 (CM9) for the Determination of Test Piece Weight, TPM, Water, Nicotine, NFDPM, Carbon Monoxide and Puff Count Obtained under Mainstream ‘ISO’ and ‘Intense’ Smoking Regimes”
(2019-02-05) (RAC-187-CTR)
Method No. 63 “Determination of Tobacco Specific Nitrosamines in Cigarette Mainstream Smoke – GC-TEA Method” updated
(2019-01-10) (SMA-163-CRM-63)
Guide No. 23 “Placement of Data Loggers in Air-cured Barns and Data Logger Maintenance”
(2019-02-05) (TSNA-034-CTG-23)
Report “2018 Collaborative Study for the Determination of Water Activity of Tobacco and Tobacco Products”
(2019-01-07) (TTPA-172-2-CTR)
Method No. 88 “Determination of Nicotine in Tobacco Products by GC/MS”
(2019-01-07) (TTPA-172-3-CTR)
NEW PROJECTS
A full list of active projects is available on the CORESTA website under the Study Groups/Active Projects section:
Scott Gottlieb has resigned as commissioner of the U.S. Food and Drug Administration (FDA), reports The Washington Post. He will leave his position in about a month. Gottlieb has been commuting weekly to Washington from his home in Connecticut and reportedly wants to spend more time with his family.
During his tenure, Gottlieb won praise and criticism for his stance on tobacco and vapor products.
In July 2017, a few months after becoming commissioner, he unveiled a comprehensive tobacco blueprint calling for reduced nicotine levels in cigarettes. But he also delayed for several years a tough new regulation for e-cigarettes.
After new government data suggested a sharp increase of vaping by minors, Gottlieb changed course, calling teen vaping “an epidemic” and threatening vapor companies that he would pull their products off the market if they didn’t curb use by minors.
In November, he proposed limiting sales of most flavored e-cigarettes—except mint and menthol—to age-restricted stores and sharply tightening online purchases. He said he also wanted to ban menthol cigarettes and flavored cigars, as well as reduce nicotine levels.
Well Fargo Securities said that while Gottlieb’s resignation would likely be broadly viewed as positive for the tobacco industry, it also introduces uncertainty.
“We believe his resignation calls into question whether or not the FDA will in fact enforce harsher regulations around youth e-cig usage/access, cig nicotine limits and a cig menthol ban given he was the champion behind these initiatives,” wrote Bonnie Herzog, managing director of equity research beverage, household & personal care, tobacco & C-stores.
“We also believe his resignation could have implications—positive, we hope—for the FDA’s approvals of the premarket and modified risk applications for iQOS—long overdue, in our view.”
British American Tobacco has said that a provision of about £436 million will be charged to the Group’s consolidated income statement in 2019 following an appeals-court judgment in two class action lawsuits in Quebec, Canada.
In a statement posted on its website, BAT said the Quebec Court of Appeal in Montreal, in a judgment made public on Friday, had upheld a trial court’s decision of May 2015 in respect of two Quebec class action lawsuits against its subsidiary, Imperial Tobacco Canada (ITCAN) and two other Canadian tobacco companies. As part of that decision, the defendants were required to deposit about C$1.1 billion into a court escrow account.
‘As part of the 2015 decision, ITCAN was required to place C$758 million (approximately £436 million) in escrow – the final payment of which was made in 2017,’ the note said. ‘This deposit was held as an asset on the Group’s balance sheet at the year-end (31 December 2018).
‘Following the 1 March 2019 judgment, the Board of Directors of ITCAN have reassessed the recoverability of the deposit and have determined that the asset’s recoverability is, under IFRS, less than virtually certain. ‘Consequently, a provision of approximately £436 million will be charged to the Group’s consolidated income statement in 2019. This will be treated as an adjusting expense.
‘There will be no impact from this charge to the ratio of adjusted net debt to adjusted EBITDA, with this decision having no impact to cash flow in 2019.
‘The Board of Directors of ITCAN and the Group are monitoring developments. As previously stated, ITCAN intends to seek leave to appeal this judgment to the Supreme Court of Canada.
‘British American Tobacco p.l.c. was not a party to the proceeding and is not a party to the judgment.’
Philip Morris International has revised its full-year 2019 reported diluted earnings per share forecast following the publication of a Canadian appeals-court judgment in respect of two class-actions in Quebec.
In a statement posted on its website, PMI said that on March 1, 2019, the Court of Appeal of Québec in Montreal had issued its judgment in two class action lawsuits against Rothmans, Benson & Hedges (RBH), a subsidiary of PMI, as well as Imperial Tobacco Canada (a British American Tobacco subsidiary), and JTI-Macdonald. PMI was not a party to the cases.
‘In 2015, the trial court ruled in favor of plaintiffs and found that the estimated class members’ damages totaled approximately C$15.6 billion including interest,’ the statement said. ‘In its decision, the Court of Appeal largely affirmed the total amount of compensatory and punitive damages including the trial court’s order for the defendants to deposit a portion of the damages, approximately C$1.1 billion, into trust accounts within 60 days. RBH’s share of the deposit is approximately C$257 million. RBH previously deposited C$226 million as security with the Court of Appeal. RBH will seek leave to appeal this judgment to the Supreme Court of Canada…
‘As a result of this decision against RBH, PMI will incur in its consolidated results a pre-tax charge of approximately $194 million, representing approximately $142 million net of tax, in the first quarter of 2019, recorded as tobacco litigation-related expenses. The charge reflects PMI’s assessment of the portion of the judgment that it believes is probable and estimable at this time and corresponds to the trust account deposit required by the court.
‘The company is monitoring developments in these proceedings and further assessing the situation, as there is a significant lack of clarity with respect to several factors, including the actual number of claimants, the associated administrative process for verification of their applications, further proceedings, and actions by parties to these proceedings. Therefore, the ultimate liability may differ significantly from this amount.
‘As a result of this charge, PMI today revises its full-year 2019 reported diluted earnings per share forecast to be at least $5.28 at the exchange rates prevailing at the time of PMI’s earnings release of February 7, 2019. Excluding the impact of this charge of approximately $0.09 per share and an unfavorable currency impact, at the then prevailing exchange rates, of approximately $0.14 per share, this forecast represents a projected increase of at least 8.0 percent versus adjusted diluted earnings per share of $5.10 in 2018 (calculated as reported diluted EPS of $5.08, plus tax items of $0.02 per share primarily related to the implementation of the Tax Cuts and Jobs Act).’
Campaigners in the UK have criticised calls to raise the legal age for buying tobacco from 18 to 21.
A press note issued by the smokers’ group Forest said this proposal had been included in a report by the All Party Parliamentary Group on Smoking and Health, which was run by the anti-smoking group Action on Smoking and Health (ASH).
Other proposals were said to include further restrictions on the portrayal of smoking on television and in films, and introducing a levy on tobacco companies that would be used to fund further anti-smoking initiatives.
“These proposals infantilise young adults,” Forest director Simon Clark was quoted as saying. “If you’re 18 and old enough to vote, drive a car and join the army you’re old enough to make an informed decision to smoke.
“Raising the current age at which you can buy tobacco, or censoring films and TV programmes that try to depict real life, takes paternalism to a new level.
“The real sickness in society is not smoking, which is in long-term decline across all age groups, but the creeping prohibition that is removing our ability to make choices and take personal responsibility for our own lives.
“Ultimately, if you treat adults like children, don’t be surprised if they behave like children.”
The US Food and Drug Administration says that it is taking new actions focused on retailers and manufacturers as part of its Youth Tobacco Prevention Plan.
But, in large part, the actions seem to be focused on electronic cigarettes, which the FDA ‘deems’ to be ‘tobacco products’.
In a statement about the actions, the FDA commissioner Scott Gottlieb, MD, said the FDA had sent a letter to the corporate management of Walgreen, requesting a meeting to discuss where there was a corporate-wide issue related to its stores’ repeat violations of selling tobacco products to ‘kids’.
‘The company is currently the top violator among pharmacies that sell tobacco products, with 22 percent of more than 6,350 inspected stores cited for illegally sold tobacco products to minors,’ the statement said.
‘FDA identified 14 other national retail chains as well, whose rates of violative inspections exceed 15 percent of their total inspected stores since the inception of the FDA’s retailer compliance check inspection program in 2010. FDA plans to ask these companies to share what policies they have in place and what more they can commit to do to prevent youth tobacco sales.
‘Furthermore, FDA sent letters to more than 40 companies seeking information about whether more than 50 products – including a variety of flavored e-cigarette products – are being illegally marketed and outside the agency’s current compliance policy.
‘The agency also today sent the first warning letters to several companies for, among other things, selling electronic nicotine delivery system (ENDS) products and a waterpipe tobacco product with labeling and/or advertising that failed to include the required nicotine warning statement.’
U.S. tobacco growers contemplate the industry’s challenges and opportunities during Tobacco Associates’ annual meeting.
TR Staff Report
Remaining competitive in the global tobacco market will require a relentless focus on quality, compliance and efficiency. That was the message to American growers during Tobacco Associates’ 72nd annual meeting in Wilson, North Carolina, USA, on March 1.
U.S. tobacco farmers have had a rough ride. Adverse weather conditions, rising labor cost, unfavorable exchange rates and a trade war made for a dismal 2018. Many tobacco farming communities are still smarting from Hurricane Florence, which caused severe flooding in the Carolinas last September. Leaf sales to China—a major customer for U.S. growers—have all but dried up after China hiked its import tariffs in retaliation for similar moves by the U.S.
Beth Farrell, agricultural programs specialist at the North Carolina Department of Agriculture and Consumer Services, urged China and the U.S. to settle their trade dispute through negotiations, noting that Brazil has been eager to fill the void left by American tobacco farmers. “Brazil is a formidable competitor,” she cautioned. “Its leaf may not be as good as ours yet, but it is good enough for many buyers.”
Adding to U.S. tobacco growers’ woes, the strong U.S. dollar has further increased the price discrepancy between American leaf and that from other origins. American leaf is well-regarded globally, but it tends to be expensive, and some countries are catching up quickly in terms of quality.
Those challenges come on top of declining demand for tobacco in the wake of shrinking cigarette sales. During the Wilson meeting, TMA Chief Operating Officer Darryl Jayson detailed the decline. U.S. smokers bought 235 billion cigarettes in 2018, down from 247 billion the previous year, according to TMA figures. In the decade to 2018, the U.S. cigarette market volume shrunk by a whopping 31.9 percent. According to Jayson, the market could drop to below 200 billion over the next two years—less than one-third of what it was in the 1980s.
With shrinking demand at home, U.S. farmers have increasingly been looking for sales abroad—and to Tobacco Associates to help them develop those markets. Established in 1947, the organization promotes American flue-cured Virginia (FCV) tobacco outside of the U.S. through a series of educational and training programs.
Tobacco Associates president Hank Mozingo provided an overview of the organization’s activities in 2018, which included visits to customers in Vietnam, Indonesia and the Middle East, along with a leaf training and study program in the U.S. He proudly noted Tobacco Associates’ role in helping Saigon Tobacco Co. (STC) regain its position as the No. 1 cigarette manufacturer in Vietnam. STC’s comeback, he said, was a direct result of the success of the Saigon Virginia and Saigon Silver brands, which were developed with Tobacco Associates technical guidance and assistance.
Proper handling and processing are just as important as choosing the right leaf, according to Tobacco Associates’ chief technical consultant, Bill Luffman. “You can buy high-quality Angus beef, but if you dress it with taco seasoning, it won’t be a fillet—it will be a taco,” he said. Overflavoring and overprocessing are common mistakes, in Luffman’s experience. Tobacco Associates shows customers how to reduce artificial flavorings with American tobacco, which is naturally flavorful. Often, the higher cost of using U.S. leaf can be offset by savings on other ingredients, according to Luffman.
“Price is what you pay; value is what you get,” observed Tobacco Associates treasurer Robert Spiers, quoting celebrity investor Warren Buffett.
George Scott, vice president of leaf at Universal Leaf North America, reviewed the latest trends in the global leaf market. Despite declining cigarette sales in nearly every market, global FCV production is estimated to increase in 2019, driven mainly by large crops in Brazil and Zimbabwe. Scott speculated that some of those volumes could be driven by demand from illicit traders. He also said the rise of “new age” products, such as e-cigarettes and heat-not-burn devices, presents a challenge to tobacco farmers because these devices use little or no leaf.
After leveling off in 2016–2017, the vapor market resumed its growth in 2018, according to Jayson. He expects market leader Juul, in particular, to do well in the upcoming year, despite the U.S. Food and Drug Administration’s (FDA) crackdown on flavors. Jayson believes Juul’s popularity is due not to the product’s flavors—which are bland by vapor industry standards—but to its slick design and the fact that it is able to deliver a cigarette-like nicotine “hit”—something that many other closed-system products have struggled to achieve. “With Juul, the FDA is barking up the wrong tree,” said Jayson about the agency’s obsession with flavors.
While the success of Juul and other vapor products will not revive tobacco growers’ fortunes, Jayson is encouraged by the legalization of cannabis in many jurisdictions. Diversifying into industrial hemp and related products presents a viable opportunity for tobacco farmers, he said. The experience of Kentucky, a traditional tobacco growing state is inspiring in this respect: The number of industrial hemp operations in Kentucky has expanded fivefold recently.
The U.K. Vaping Industry Association (UKVIA) will hold a one-day business-to-business conference on May 9, 2019, titled “Seizing the vaping public health prize.”
Vaping is increasingly recognized as the most effective way to stop smoking. A recent review of the evidence by Public Health England confirmed that view. The House of Common’s Science & Technology Committee has called for a review of advertising and product restrictions to encourage smokers to switch.
Despite such evidence, doubts about vaping persist. Conflicting and often sensationalist media reports have created confusion among the public. The proportion of the population mistakenly thinking that vapor products are as harmful or more harmful than smoking increased from 7 percent in 2013 to 26 percent in 2017, according to Action on Smoking & Health.
Held 8 am-5 pm at 4 Hamilton Place in London, the UKVIA conference will among other topics explore the roles of the public health sector, the media and employers in promoting vaping over smoking.
Confirmed speakers include:
Mark Pawsey MP, chair of the All-Party Parliamentary Group For Vaping
Sir Kevin Barron MP, vice-chair of the All-Party Parliamentary Group For Vaping and vice-chair of the All-Party Parliamentary Group on Smoking and Health
Sarah Jakes, chair of the New Nicotine Alliance
Sairah Salim-Sartoni, smoking cessation and harm reduction consultant
Jon Ungoed-Thomas, Sunday Times
Daniel Pryor, Adam Smith Institute
The conference will be followed by “A celebration of vaping,” on a heated terrace overlooking Hyde Park. Guest will be treated to a luxury drinks reception and an extensive BBQ menu.
The conference and evening dinner are sponsored by Diamond Mist; the drinks reception is sponsored by Logic Vapes; lunch is sponsored by British American Tobacco; the delegate bags are sponsored by Myblue; the badges are sponsored by Flavoriq and the lanyards are sponsored by Innokin.
Tobacco Reporter‘s sister publication Vapor Voice has been confirmed as the official media partner for the forum.
