FDA rules threaten my right to smoke!

“It has been my experience that folks who have no vices have very few virtues.” – Abraham Lincoln

On June 22, 2009, the Family Smoking Prevention and Tobacco Control Act (Tobacco Control Act), was signed into law giving the FDA authority to regulate the manufacture, distribution, and marketing of tobacco products. Initially the act was focused on cigarettes and smokeless tobacco. But on May 5 of this year, the FDA released the final rules extending the regulations to cigars. Under the pretext of improving public health and protecting future generations from the risks of tobacco use, the FDA has extended its authority to cover all products that meet the definition of a tobacco product. The new rule will go into effect on August 8, 2016.

The FDA already regulates cigarettes, cigarette tobacco, roll-your-own tobacco and smokeless tobacco. The new FDA rule extends the FDA’s authority to include the regulation of electronic nicotine delivery systems (such as e-cigarettes and vape pens), all cigars, hookah (waterpipe) tobacco, pipe tobacco and nicotine gels, among others.

Cigars that were on the market in 2007 will be allowed to remain for sale, but any cigars introduced since then are subject to the new rule unless the maker can prove they’re substantially equivalent to existing products. The cigars must be substantially equivalent not just in their composition, but also in their health impacts as a whole. If they can not be shown to be substantially equivalent to existing products, the FDA will ordered the cigar off the market.

The new rule allows the FDA to remove from the market any cigar introduced to the market after 2007. It forces post 2007 cigars to go through a rigorous and costly review process. However, nothing gets done quickly by the FDA. Since the FDA started to implement this rule for cigarettes in 2009, the FDA has approved very few new tobacco products. A December 13, 2012 report from the Associate Press found that the FDA had received nearly 3,500 of these “substantial equivalence” applications for cigarettes and smokeless tobacco products since the FDA starting regulating tobacco in 2009. The FDA was expected to rule on these applications within ninety days. However the study found that 90 percent of the applications had been lingering over a year.

Other than being made from tobacco, a cigarette is nothing like a cigar. Cigarettes are mass produced by machine with little variation and/or creativity. Generally, there are few new cigarette products introduced on a yearly basis. Premiums cigars are hand rolled, produced in limited select batches, and vary depending on the blend of tobacco used. It is the equivalent of regulating Budwiser, Coors, Miller, etc. in the same manner you would regulate wine vineyards. Premium cigars have a blend, a flavor, an aroma, a taste, and a personality influenced by the year of harvesting, the region of growth and cultivation, and the blend of tobacco used to make that batch of cigars. Every year new cigars are introduced into the market. Some may be just limited runs of a particular cigar for a certain year while others are entirely new product lines.

“Any cigar smoker is a friend, because I know how he feels.” – Alfred de Musset

As a cigar smoker, I love smoking a cigar from a particular good year. What is of greater pleasure to me is finding that new cigar with its unique unknown flavor and aroma.  Every week, I stop by my favorite cigar shops and ask what’s new. I look forward to new brands and limited editions.

Smoking a cigar is not like lighting up a Marlboro. Every stick can be different. Cigar blenders, rollers and manufacturers are artisans. The new regulation will stifle that creativity and variety within the United States. The cigar market will consist of cigars already introduced into the market and ones that survive the two to three year review process of the FDA. It is estimated that the new FDA rule will wipe out 10% to 50% percent of the cigar market.

People may still get their cigars abroad when the travel or on vacation but at much higher prices. The greater impact will be on small cigar business in the United States. Because of the custom nature of premium cigars and the boutique size of the majority of the cigar companies, the extension of the Tobacco Control Act to cigars will essentially snuff many of these small cigar manufactures.

I have several cigar enthusiast friends who have started their own cigar brands. It is estimated that the FDA review process will cost $100,000 per brand. If you have 10 new brands, it will cost you a million dollars. What small business could survive such an onerous increase in its costs. My friends, like other small businesses, do not have large amounts of money and survive year to year trying to build their business on the small profits generated from the previous year. They cannot afford to go through the FDA review process for each new cigar. They will eventually be chocked out by the FDA’s new rule. The cigar industry as whole will also suffer and be limited to the same brands already on the market.

The FDA says its goal is to improve public health and protect future generations from the risks of tobacco use. But in effect, the new regulation is a de facto ban on any new cigars.

“Gentlemen, you may smoke.” (ending the long ban on smoking held by Queen Victoria in the early 20th Century) – King Edward VII

There is hope for the cigar industry.

On April 12, 2016, Rep. Robert Aderholt (R-AL), chairman of the subcommittee that sets the budget for the FDA, adds a rider to his subcommittee’s spending bill that would deny the FDA any funding for its proposed premium cigar regulation program.

On April 24, 2016, the U.S. House Committee on Appropriations, introduce bill H.R. 5054 which included language that changes the predicate date from February 15, 2007, to the effective date of the FDA’s new regulation on cigars, or August 8, 2016. This rider, as well as Rep. Aderholt’s rider, must pass through the Senate Appropriations process and be signed by President Obama for it to go into effect.

Advertisements

Leave a comment

Filed under Business Law

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s