FDA Could Vaporize E-Cigarette Industry In Just One Regulation

Food & Drug Administration Building in Silver Spring, MD 

Taxes are often the biggest barrier to business and innovation, but regulations have also been a major problem for the private sector. Burgeoning industries are faced with so many hurdles when it comes to growing and becoming profitable that onerous regulations can become too damaging for any venture to succeed.

One industry that has been on the upswing over the last few years is the alternative to traditional nicotine products called “vaping.”   The term was even made the word of the year in 2014 by Oxford Dictionaries.  As many consumers have been turning to vaping products, the numbers show just how popular vaping has become:

• In 2013, there were 3,500 vape stores in the United States, with more than a dozen stores opening up in some cities every year
• Some stores are bringing in $1.3 million a year
• There was more than $1 billion in vape equipment and product sales in 2013
• In 2015, the industry is forecast to reach $3.5 billion
• The industry could be worth $10 billion or more by 2017

Currently, the Food and Drug Administration (FDA) is in the process of placing regulations on vaping products but there is one key provision of possible regulatory action that could devastate the industry.  Lydia Wheeler, of The Hill, detailed the problem with the proposed regulations:

In it’s proposed rule to assert, for the first time, its authority over e-cigarettes, the Food and Drug Administration said all products that hit stores after February of 2007 would have to apply retroactively for approval — a process that companies say would be prohibitively expensive.

As much as 99 percent of the applicable products came after 2007, said Jan Verleur, co-founder and CEO of VMR Products.

The 2007 date comes from the Family Smoking Prevention and Tobacco Control Act (H.R. 1256) enacted in 2009, which granted the FDA greater regulatory authority over tobacco products. The problem with the FDA using the 2007 date for new rules on vaping is that many of the products that are part of the booming industry were made after that arbitrary 2007 date.  What this will mean is that instead of a fair process for new vaping products to stay on the on market, there will be more stringent regulations which will have to be dealt with immediately. Many businesses would likely be unable to meet the cost of such a regulatory burden and in the end would have shut their doors permanently.

There is no denying that the FDA should enforce some bit of regulation.  The problem with what the FDA is proposing is that it is unfair treatment over how regulations would be imposed. The government shouldn’t be in the business of shutting down private companies and halting innovation long before it can be perfected. This is clearly a case where the FDA must recognize that their actions will do far more damage than any overall societal goal they hope to achieve.

One option to fix this problem is a clarification of the date through legislation. Rep. Tom Cole (R-Okla.) is chief sponsor of the FDA Deeming Authority Clarification Act of 2015 (H.R. 2058), which would help solve this problem. The bill would change the Feb 2007 date to the effective date of the final rule. The FDA already has a massive backlog of product applications; there is no reason to flood that already crowded docket. The clarification would only apply to this aspect of the FDA’s regulatory authority and the clarity would ensure that there’s no disruption to the vaping industry. If the FDA’s goals are well intentioned, there should be absolutely no opposition to changing the 2007 date.

The Taxpayers Protection Alliance is a fierce critic of the expansion of regulations that have burdened private industry and cost the economy trillions of dollars over the last several years. Currently, the vaping industry is still in infancy and the focus should be on finding ways to expand the market and attract new customers while maintaining existing business. Regulatory measures that force the industry to spend exorbitant amounts on compliance that is unfairly singled out on vaping must be stopped before any damage can be done.