A Dopey Policy

Currently, 26 states and the District of Columbia allow either medical and/or recreational marijuana.  The January 23, 2017 edition of Westword reported that 11 additional states are considering legalizing recreational marijuana this year.

But as states fall all over each other to legalize recreational marijuana and their citizens light up their joints, barriers are being erected that are making it increasingly difficult for people who want to move away from smoking cigarettes, which are legal, to a safer product, which is also legal.  Electronic nicotine delivery systems (ENDS), or vaping products, now worth $3.5 billion per year, are facing growing impediments and possible extinction thanks to a combination of state and local government activities and federal regulation under the Food and Drug Administration’s (FDA) as a result of the 2009 Family Smoking Prevention and Tobacco Control Act (TCA).

Vaping devices, or e-cigarettes, were created as safer alternatives to smoking tobacco.  Chinese pharmacist (and smoker) Hon Lik is credited with producing the first commercially successful e-cigarette in 2003 after his father, who was also a smoker, died of lung cancer.

E-cigarettes first became available in Europe in 2006 and Americans were introduced to these devices between 2006 and 2007.  People who enjoy tobacco, but want to avoid the harmful consequences of smoking, such as inhaling a litany of poisonous chemicals like tar and carbon monoxide that can cause cancer and heart disease, are turning to vaping.  In addition to harm reduction, others use these products to slowly wean themselves off cigarettes and nicotine addiction.  Whatever the reason, vaping certainly has become a cultural phenomenon.

Vaping devices can vary in size and shape, but all heat up and vaporize a flavored liquid composed of vegetable glycerin, propylene glycol, or both.  The e-liquid, or “juice”, usually contains a certain percentage of nicotine, the same nicotine that can be found in nicotine replacement therapy such as patches or gum.  However, the juice can also be purchased with no nicotine.  The person using these vaping devices will inhale the vapor and exhale it.  While the vapor appears thicker than smoke, it dissipates quickly.

Studies have shown that switching to vaping produces significantly improved lung function and quality of life.  For example, an April 2016 Royal College of Physicians report concluded that e-cigarettes appear to be effective as an aid to quitting smoking; that any health hazard arising from vapor inhalation is unlikely to exceed 5 percent of the harm from smoking tobacco; that evidence available today indicates that e-cigarettes are being used almost exclusively as a safe alternative to smoking; and that in the interest of public health, it is important to promote the use of e-cigarettes.

While there is growing evidence vaping is a better alternative to smoking, states and local governments have taken steps that could make it more difficult for individuals to vape.  The Tax Foundation’s “Facts and Figures 2017” report indicates that seven states and seven local jurisdictions currently tax vaping devices, the e-liquid, or both.  These seven states are California, Kansas, Louisiana, Minnesota, North Carolina, Pennsylvania, and West Virginia.  The local jurisdictions are Juneau, NW Artic Borough, Petersburg, Mat-Su Valley in Alaska; the District of Columbia; Chicago and Cook County in Illinois; and Montgomery County in Maryland.

The Consumer Advocates for Smoke Free Alternative Association is tracking fifteen states that are considering legislation to add or increase taxes on vaping products in 2017.  For example, Montana is on its way to taxing vaping liquid at 74 percent of the wholesale price; New York Governor Cuomo wants a $0.10 tax per millimeter of e-juice, while the N.Y. state Assembly wants a tax four times higher; and Ohio Governor John Kasich is looking to increase Ohio’s vaping tax from 17 to 69 percent of the wholesale price.

Current vapers are concerned that increasing the taxes on these products will make it harder for them, and will discourage others, to move away from smoking cigarettes.  After all, cigarettes just need a match while vaping takes a bit more work and an investment in purchasing the electronic device.

An example of what happens when high taxes are placed on vaping products can be found in Pennsylvania.  In October 2016, Governor Tom Wolf signed a 40 percent tax on all vaping products, hoping to raise $490 million for the state’s coffers.  Retailers had to pay the tax on all vaping products, including what they had in stock, by the end of 2016 or face penalties.

According to Brian Fojtik at the Reason Foundation, the Pennsylvania tax caused 160 small vaping businesses to shut down.  Vapers worried they would be forced to go back to cigarettes or travel out of state to get vaping supplies.  The Pennsylvania legislature is aware of these adverse consequences and is looking to reverse what they did in 2016.

Meanwhile, the federal government, through the FDA, is creating its own high hurdles in allowing harm-reduction tobacco products into the marketplace.  Under the TCA, the FDA has the authority to regulate the manufacture, marketing, and distribution of tobacco products such as cigarettes, cigarette tobacco, roll-your-own tobacco, and smokeless tobacco.

One May 5, 2016, the FDA finalized a proposed rule that deemed ENDS products to be brought under its jurisdiction.  While the regulation did some good things, such as banning sales of vaping products to anyone under age 18 and requiring warning labels, it also placed burdensome and expensive requirements on vaping manufacturers, particularly small manufacturers and vape shops.  It orders them to submit pre-marketing tobacco applications (PMTA) to allow them to sell all their products unless the product was already on the market prior to February 15, 2007.  Although the rule took effect on August 8, 2016, it gives ENDS manufacturers two years to comply.

A May 5, 2016 Wall Street Journal reported that regulatory consulting firm SciLucent LLC has analyzed that vaping manufacturers and vape shops could pay anywhere from $2 million to $10 million per vaping item to get marketing approval.  The FDA disputes these figures, claiming that a PMTA will “only” cost between $117,000 to $466,000.  It does not matter who is correct.  These price tags will effectively ban most vaping products because a majority of e-cigarette manufacturers are small businesses.

Since the rule was finalized, efforts have been underway to change the predicate date so that vaping products already on the market will not have to comply with the PMTA process.  On February 21, 2017, Reps. Tom Cole (R-Okla.) and Sanford Bishop (D-Ga.) introduced H.R. 1136, the FDA Deeming Authority Clarification Act.  It would change the predicate date of February 15, 2007 to 21 months after H.R. 1136 becomes law.  The Council for Citizens Against Government Waste supported similar legislation in 2016.  The legislation would also restrict youth access to vaping products, increase consumer safety, require ingredient disclosures, and have labeling requirements.  Similar language to H.R. 1136 could be considered in a spending bill later this month.

Changing the predicate date would still allow the FDA to overseeing vaping products but those currently on the market would not need a costly PMTA.  If a manufacturer should come up with a new but similar vaping product, called a predicate product, it would have to provide a less onerous “substantial equivalence” application that shows their new product is substantially equivalent to a product that was on the market prior to the new established predicate date.  This change would also free up the FDA from reviewing thousands of pages of a PMTA and focus on other issues, such as making sure ENDS manufacturers and distributors comply with good manufacturing practices and are marketing their products correctly.

Perhaps politicians and government bureaucrats should stop thinking about tax revenue and creating regulatory roadblocks for people that want to switch to vaping from smoking, as well as the adverse consequences to public health.  A June 27, 2016 Reason Magazine article by Jacob Sullum discussed a 2016 study that found 6 million Europeans have quit smoking and 9 million have cut back on smoking because of e-cigarettes.  According to Sullum, the lead researcher on the project stated, “the European data show that use of electronic cigarettes seems to have a positive impact on public health for two main reasons: 1) High smoking cessation and reduction rates are observed, and 2) electronic cigarette use is largely confined to smokers (current and former), with minimal use by nonsmokers.”  A February 7, 2017, British National Health Service report showed similar results.  It’s clear health officials overseas are seeing the benefits of vaping and allowing access to even newer tobacco harm reduction devices.

Certainly, federal, state and local governments could tax and regulate all forms of e-cigarettes into extinction.  Ironically, in some states and localities, they are making it easier for people to smoke marijuana, which is certainly not a harm-reduction activity.  A far more prudent policy for politicians and bureaucrats would be to encourage, not discourage, people to switch to harm-reduction tobacco products such as vaping instead of smoking tobacco.