They say regulation is always a step behind the money. Approximately 10 years after the commercialization of e-cigarettes, the U.S. Food and Drug Administration (FDA) announced new regulations on the $3.5 billion industry.
The centerpiece of the regulations is to regulate the e-cigarettes, vaporizers, e-pipes and other electronic nicotine delivery systems similar to the way cigarettes are regulated. Mainly, FDA approval shall soon be required to sell, manufacture, import or distribute e-cigs. E-cig manufacturers will have until 2018 to sell their products while they submit to FDA approval. Manufacturers will have one additional year to continue to sell while the FDA reviews their application to ensure that the e-cigs meet the FDA’s requirements to sell to the public.
Notwithstanding this three-year window, barring a successful legal challenge, the FDA is proposing to begin certain regulation of e-cigs as soon as Aug. 8, 2016. For advertisers and marketers, the most pertinent regulations to keep in mind are as follows:
· Free samples as a promotional tactic will end as of Aug. 8, removing one sales incentive retailers and marketers may have used to introduce the product to the public.
· Retailers, manufacturers, importers and distributors alike must begin to add the following warning statement to e-cigs by May 10, 2018: “WARNING: This product contains nicotine. Nicotine is an addictive chemical” in prescribed size and format requirements. Advertisements for e-cigs must bear the same addictiveness warning.
· A ban on the use of the terms “light” “low” and “mild” descriptors as an inducement to sell e-cigs unless FDA permits such descriptors to be used.
· Ban on sale to minors and sale in vending machines.
What is unclear is whether clinical studies will be required to show that a particular e-cig helps smokers quit and/or reduces the health risks associated with smoking conventional tobacco products. The FDA has taken the position that selling such a feature, which is commonly used to differentiate e-cigs from conventional tobacco, may require “valid scientific evidence other than controlled studies” but also left open the possibility that research may not be necessary if “there is an established body of evidence regarding the health impact of the product.”
In light of such uncertainty, the prudent move for advertisers and marketers would be to advise clients to not highlight e-cigs as a smoking cessation device without clear substantiation.
Critics argue that the regulations will choke off innovation and increase prices as the cost of complying with FDA approval can run into the millions. This could result in the e-cig industry looking a lot like traditional tobacco with fewer and larger players. This could have a positive or negative impact on advertising and marketing budgets of e-cig makers.
For those in the advertising and marketing industry, there are three key takeaways:
· Product and labelling requirements will soon by changing.
· The tactics an advertiser and marketer can use to promote e-cigs will be reduced.
· Although always a concern no matter what the product, clear substantiation of e-cig benefits, especially as it pertains to health claims, must be present.