Tag: cigarettes

  • FDA Ignored Evidence in ‘Deeming’ Premium Cigars

    FDA Ignored Evidence in ‘Deeming’ Premium Cigars

    Photo: Viacheslav Yakobchuk

    The U.S. Food and Drug Administration ignored evidence about health risks in considering premium cigars to be subject to same law as cigarettes, a federal judge ruled on July 5, reports Reuters.  

    The litigation focuses on the 2016 Deeming Rule, in which the agency identified a wide range of tobacco products, including premium cigars, to be subject to its regulatory authority along with cigarettes under the Family Smoking Prevention and Tobacco Control Act.

    The FDA rule requires cigar makers to register their products annually, provide ingredient lists for each product and submit products for laboratory testing—procedures the premium cigar industry considers impractical for its handmade, “artisan” products.

    The Premium Cigar Association and Cigar Rights of America challenged the Deeming Rule, arguing that, unlike cigarettes and e-cigarettes, premium cigars do not appeal to young people and are not associated with addiction. They cited studies showing that young people are unlikely to use premium cigars, that users of premium cigars are unlikely to smoke them frequently and that infrequent cigar use is not associated with increased mortality.

    U.S. District Judge Amit Mehta in Washington DC agreed that the FDA had not adequately considered the studies cited by the plaintiffs, instead asserting that there was “no evidence” that premium cigars were less harmful.

    “Where, as here, an agency speaks in absolute terms that there is no evidence, it acts arbitrarily and capriciously when there is in fact pertinent record evidence and the agency ignores or overlooks it,” the judge wrote.

    Judge Mehta asked the FDA and the industry groups to submit briefs on whether he should vacate the FDA’s decision or simply remand the matter back to the agency.

  • Study: Vapes Have Higher Health Costs Than Smokes

    Study: Vapes Have Higher Health Costs Than Smokes

    Photo: Tobacco Reporter Archive

    The use of electronic cigarettes costs the United States $15 billion annually in healthcare expenditures—more than $2,000 per person a year—according to a study by researchers at the University of California San Francisco School of Nursing.

    The study, published on May 23 in Tobacco Control, is the first to look at the healthcare costs of e-cigarette use among adults 18 and older, according to the release.

    “Our finding indicates that healthcare expenditures for a person who uses e-cigarettes are $2,024 more per year than for a person who doesn’t use any tobacco products,” said lead author Yingning Wang of the UCSF Institute for Health and Aging.

    According to the U.S. Centers for Disease Control and Prevention, combustible cigarette smoking-related illness in the United States costs more than $300 billion each year, including more than $225 billion for direct medical care for adults.

    The researchers based their estimates of healthcare costs and utilization on data from the 2015–2018 National Health Interview Survey. Healthcare utilization included nights in the hospital, emergency room visits, doctor visits and home visits.

    “Healthcare costs attributable to e-cigarette use are already greater than our estimates of healthcare costs attributable to cigar and smokeless tobacco use,” said Wang. “This is a concerning finding given that e-cigarettes are a relatively new product whose impact is likely to increase over time.”

  • Rising Oil Prices May Affect Cigarette Sales

    Rising Oil Prices May Affect Cigarette Sales

    Photo: Destina | Adobe Stock

    Rising gas prices will likely depress cigarette demand due to consumers having less cash to spend at gas stations, according to CNBC.

    The Russian invasion of Ukraine has driven oil prices up as the U.S. and other Western countries have imposed sanctions on Russia. On Thursday, West Texas Intermediate crude futures, the U.S. oil benchmark, was trading at prices not seen since the financial crisis of September 2008, and Brent crude hit a high from May 2012.

    Gaurav Jain, a Barclays analyst, estimates that a 1 percent increase in oil prices will cause U.S. cigarette volume to decline by 0.1 percent. “The trend seems to suggest that as consumers saved more money at the gas station and went to the attached convenience store, they bought more cigarettes (impulse purchase item). Now as oil prices move higher, the reverse could happen,” Jain wrote in a note to clients.

    Jain predicts that U.S. cigarette volume for fiscal 2022 will fall by 5 percent with prices rising 7 percent. It’s also expected that some consumers will switch to other tobacco products, such as e-cigarettes or modern oral nicotine pouches, in search of cheaper alternatives.

  • Billboards with cigarette ads to be dismantled in Indonesia

    Billboards that advertise cigarettes and are displayed around schools in North Jakarta, Indonesia, will be dismantled in the near future, according to a story in the daily Tempo.

    Mustafa Kemal, head of North Jakarta Education Sub-Department Regional I, stated that the existence of such billboards is unethical and could potentially influence students to smoke.

    “If there are students caught smoking, either inside or outside of schools during school hours, they will be sanctioned,” he said.

    Such sanctions would include summoning a child’s parents and revoking their Jakarta Smart Card.

  • South Korea’s tobacco tax revenue expected to soar next year

    Tax revenue from cigarette sales in Korea is expected to reach more than 12.68 trillion won ($10.72 billion) next year, nearly double the increase from 2014, according to a report shown Monday by the independent Korea Federation of Taxpayers.

    The Korea Federation of Taxpayers said in its report that the increase is attributable mainly to the sharp tax hike early this year but little reduction in sales volume. The tobacco tax hike was introduced as part of the government’s strategy to reduce the smoking rate in Korea.

    The government raised a total of 6.74 trillion won in tobacco tax revenue in 2014 before the tax hike took effect on Jan. 1. This year, it is estimated that the government will collect 11.17 trillion won, up 4.42 trillion won from the previous year. The government had predicted that the tax revenue would increase only by about 2.78 trillion won this and next year, respectively, as sales were expected to drop due to the price hike.

    Once the new cigarette pricing went into effect, the price of cigarettes increased to 4,500 won, up 80 percent from the previous 2,500 won. From January to June, the government collected approximately 4.3 trillion won in tax revenue from tobacco sales, up 1.2 trillion won from the year before. During the same period, cigarette sales decreased by 28.3 percent due to the tobacco tax hike.

    Although tobacco sales plunged early this year as a result of the sharp price hike, sales have begun to show signs of recovery.

  • Nepal: Cigarettes in short supply as result of wholesaler hoarding

    Several popular brands of cigarettes are in short supply in Nepal’s Kathmandu Valley due to hoarding and black-marketing by some wholesalers, according to Republica. Some wholesalers have begun to hoard cigarettes following media reports that the government was planning to hike excise duty on cigarettes through the budget for fiscal year 2015-2016. In addition to reducing supply, some wholesalers are also accused of raising prices in an arbitrary manner.

    “It is very difficult to get [cigarettes] as per our demand,” retailer Ram Kumar Rai told Republica. “Not only are wholesalers reducing supply, they are also overcharging us for cigarettes.”

    Rai said he was charged npr50 ($0.44) more for a box of Surya cigarettes containing 10 packets. “The wholesaler asked me to pay npr1,450 for a box of cigarettes which cost only npr1,400,” he said.

    Retailer Madhav Timalsina, of Sundhara, paid npr1,500 for the same pack. “Wholesalers have been overcharging us, citing short supply,” he told Republica. “We are not getting cigarettes as per our demand, as wholesalers are hoarding them anticipating duty hike in upcoming budget.”

    Meanwhile, manufacturers maintain that they have not reduced the supply of cigarettes.

    “We have increased supply by around 10 percent recently,” Ravi KC, vice president of Surya Nepal, told Republica. “Our authorized dealers and cycle-boys have not reported us about shortage and hoarding of cigarettes.”

    Department of Commerce and Supply Management officials have vowed to intensify market monitoring and to take action against anyone found guilty of hoarding cigarettes or participating in black-marketing.

  • Closures expected in Indonesian tobacco industry

    As much as 15 percent of the workforce at tobacco-related companies in East Java, Indonesia—or more than 23,000 workers—are at risk of being laid off this year, according to a story in the The Jakarta Post.

    Based on 2014 data, the number of people working in East Java’s tobacco and tobacco products industrial (IHT) sector was 159,117, according to East Java Chamber of Commerce and Industry (Kadin) vice chairman Dedi Suhajadi. The sector’s workforce also decreased by 21,300 workers in 2014 from 180,466 workers in 2013.

    “Many IHT entrepreneurs are affected,” Dedi said. “This is attributable to the annual increase in tobacco tax, government regulations and groups that interfere with the concentration of IHT entrepreneurs in meeting tax obligations.”

    The government raised the IHT tax target to IDR141.7 trillion in 2015 from IDR111.21 trillion in 2014. Over the past five years, the average increase in IHT tax was 16.09 percent.

    Data from the East Java Manpower and Transmigration Office indicated that 790 IHT companies were still operating in 2014, however, only about 200 were producing on a regular basis. In 2011, there were about 1,100 cigarette factories, according to Dedi.

    “Those that have gone out of business are small- and medium-scale factories. Only the large-scale companies are surviving,” said Dedi.

    Between 2009 and 2013, approximately 4,900 cigarette factories closed their doors.

  • Philip Morris Korea to increase exports

    Philip Morris International Korea (PMIK) will increase its cigarette exports to an expected 20 billion sticks this year after securing larger markets in Japan and Australia.

    The company will expand its export of cigarettes manufactured in its factory in Yangsan, South Gyeongsang Province, in an effort to make up for domestic losses caused by a tobacco tax hike that went into effect on Jan. 1. The bill—which increased tobacco prices to won4,500 per pack from the average won2,500 per pack—resulted in significant decreases in sales for tobacco makers operating in the country. PMIK’s sales dropped by approximately 18 percent in the first quarter of 2015 compared to the first quarter of 2014.

    In 2012, the company invested approximately won200 billion into the Yangsan factory to expand its packaging facilities and add raw material processing facilities. Today, the factory has the ability to produce 40 billion cigarettes per year, double its prior manufacturing capacity.

    “Since 2012, our exports grew more than 10 times, thanks to the increased capacity in Yangsan factory, as well as the growing quality,” said Mikhail Prokopchuk, PMIK’s director of operations.

    Exports from the Yangsan factory to Japan, Australia, Singapore, Taiwan, Hong Kong and Macua have increased dramatically since manufacturing capabilities were expanded, with export volumes increasing from 900 million cigarettes in 2012 to 4.5 billion cigarettes in 2014.

  • Cigarette smoke releases more toxins than e-cigs, study says

    A study examining the vapor released from Blu Ecigs’ and Skycig’s e-cigarettes in comparison to the smoke emitted by Philip Morris USA’s Marlboro Gold and Imperial Tobacco’s Lambert & Butler cigarettes found that levels of harmful and potentially harmful constituents (HPHCs) in cigarette smoke were 1,500 times higher than the levels found in e-cigarette vapor.

    The study—titled “Comparison of select analytes in aerosol from e-cigarettes with smoke from conventional cigarettes and with ambient air”—was published in the December 2014 issue of Regulatory Toxicology and Pharmacology. According to proponents of vapor product use, the study lends credence to the belief that, although the long-term effects of inhaling the propylene glycol and glycerin found in e-cigarette vapor are not yet known, such products provide a safer alternative to smoking combustible cigarettes.

    According to the study, the e-cigarettes tested contained and delivered mostly glycerin and/or propylene glycol and water, and emitted an aerosol nicotine content that was 85 percent lower than the cigarette smoke nicotine content levels. The study also found the levels of HPHCs to be consistent with the air blanks—at <2 μg/puff—and no significant contribution of tested HPHC classes was found for the e-cigarettes tested. The e-cigarettes and combustible cigarettes in the study were tested on a smoking machine to compare the amount of nicotine delivery and the relative yields of chemical constituents.

  • Aussies to jack up tobacco tax in 2014

    The price of a pack of cigarettes will rise by about $0.07 next year in Australia, according to a story in the Herald Sun.

    The increase will see the government face a potential re-election tussle with tobacco companies and retailers, who are still smarting over plain packaging laws.

    Cigarettes were the only sin tax targeted by Treasurer Wayne Swan’s big-cutting budget. Last year’s budget saw an increase on taxes on beer and cut the number of duty-free cigarettes Australians could bring home after travelling overseas.

    The duty free cuts last year were set to raise $175 million by 2015.

    A pack of 25 cigarettes will be $0.07 more expensive from the first half of 2014, after a change in indexation that sees tobacco excise keep pace with salary rises. Budget papers did not reveal how much this would raise.