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able to them will narrow considerably and
offering a wide variety of options is a big
part of the channel’s appeal.The impact on
the retail landscape could be transforma-
tive. “If it goes through, as far as I know,
we won’t have anything left to sell,” Rob-
ert Armstrong, owner of Safer Vapors in
Worcester, Massachusetts told his local
newspaper,
The Telegram.
“Everything we
sell would be illegal.”
Among more mainstream retailers,
sentiment is mixed, with some anticipat-
ing a bump in sales as other area retailers
exit the category and also hoping the cat-
egory will be easier to manage. As one c-
store retailer noted in Wells Fargo’s recent
Tobacco Talk survey, “It may be the best
thing for us—Might drop a lot of under-
performing SKUs and may close some of
the vape shops.”
Fighting Back—With Teeth
As it turns out, consequences like these
may well prove to be chinks in FDA’s ar-
mor. Lawsuits filed on behalf of the cigar
and vapor industries argue, among other
things, that the FDA neglected its re-
quired duty to consider the regulations’
impact on small businesses. The Cigar As-
sociation of America (CRA), International
Premium Cigar and Pipe Retailers Asso-
ciation (IPCPR), and the Cigar Rights of
America (CAA) teamed up on an action
alleging that the agency failed to “perform
an adequate cost-benefit analysis,” per the
Regulatory Flexibility Act, to account for
the deeming rule’s effect on small busi-
nesses. Similarly, a complaint filed by a
number of vapor industry associations,
including Right to be Smoke-Free Co-
alition, Not Blowing Smoke, AEMSA,
SFATA, CASAA, AVA, EVCA, SEVIA
and various state vaping associations chal-
lenged the deeming rule and the Tobacco
Control Act on various constitutional and
administrative grounds. [A previous legal
challenge presented by vapor manufacturer
Nicopure has been rolled into this action
by order of a
U.S. District Court for the
District of Columbia judge
.]
In July, NATO partnered with the pipe
tobacco counsel and IPCPR to send a letter
to FDA “requesting that the agency delay
the implementation of these manufacturing
regulations on retailers because the agency
did not conduct a required regulatory re-
view or analyze the financial impact on
small businesses, which is required by the
federal regulatory flexibility law,” reports
Briant.“FDA recently responded with a let-
ter indicating that, because there has been a
lawsuit filed challenging the manufacturing
regulations being imposed on retailers, they
will let the lawsuit decide the issue.”
While some of the regulatory provisions
went into effect on August 8, many in the
industry hold out hope that the deeming
Estimated time it will take a manufacturing company
to complete a Pre-Market Tobacco Application (PMTA) per SKU:
FDA’s estimate of what the
application process will cost a manufacturer:
The
Wall Street Journal
’s
estimate of that cost:
1,713 to 5,000 hours
$2 million
$330,000
“It may be the
best thing for us.
Might drop a lot of
underperforming
SKUs and may
close some of the
vape shops.”
34
TOBACCO BUSINESS INTERNATIONAL
SEPTEMBER/OCTOBER 2016