Dr. Hemphill teaches Business and Society in the M.B.A. program. In the B.B.A. program, he teaches courses in Corporate & Business Strategy, Business and Society, Innovation Management and International Business. His research areas include: Strategic Management of Technology and Innovation; Technology and Innovation Policy; Business Governance and Ethics; and Global Business and International Political Economy.
Latest posts by Thomas Hemphill (see all)
- Manufacturing Benefits from Trump’s Deregulation Agenda - February 13, 2019
- The Inevitability of E-Cigarette Regulation - November 7, 2018
- Manufacturing and Trump’s Deregulation Agenda - July 30, 2018
The ongoing controversy over e-cigarettes and youth smoking has hit a proverbial regulatory wall. In September 2018, U.S. Food and Drug Administration (FDA) Commissioner Scott Gottlieb acknowledged “an epidemic of use of e-cigarettes among teens.” On August 8, 2016, the FDA’s “deeming rule,” which regulates electronic smoking devices in the same way it regulates other tobacco products, became effective, resulting in the federal prohibition on sales of e-cigarettes to anyone under the age of 18. Perhaps not a moment too soon.
According to the 2017 National Youth Tobacco Survey, 11.7 percent of American high school students use e-cigarettes, up from 1.5 percent in 2011, or a 780 percent increase in use over six years. The survey also reported that, among American middle school students, 3.3 percent are regular smokers of e-cigarettes, up from 0.6 percent in 2011, or a 550 percent increase over a corresponding six-year period. Reflective of this rise in youth e-cigarette usage, in 2017, 2.1 million middle and high school students used e-cigarettes, while 1.4 million used cigarettes and 1.3 million used cigars.
For the uninitiated, e-cigarettes are electronic devices that operate by heating a liquid to a temperature high enough that it produces an aerosol inhaled by the smoker. While e-cigarettes contain far fewer toxic chemicals than combustible cigarettes or cigars, they still convey highly variable amounts of harmful chemicals and nicotine to the user.
In January 2018, the National Academies of Sciences, Engineering, and Medicine (NASEM) released an FDA-commissioned report on the potential public health consequences of e-cigarettes. The NASEM report found evidence suggesting that for users completely switching from combustible cigarettes to e-cigarettes reduces an individual user’s exposure to numerous toxicants and cancer-causing carcinogens, as well as reduces negative short-term health outcomes. However, the report also found that youth and young adults who use e-cigarettes are more likely to try combustible cigarettes, thus indicating that e-cigarette usage is a “gateway” to combustible cigarette smoking.
The FDA is taking the e-cigarette teen smoking epidemic seriously. As a first step, the FDA initiated their Youth Tobacco Prevention Plan early in 2018. This plan consists of three strategies. First, prevent youth access to tobacco products; second, curb the marketing of tobacco products aimed at youth; and third, educate teens about the dangers of using any tobacco products.
The second strategy, curbing the marketing of tobacco products to youth, is underway. In May 2018, the FDA and the Federal Trade Commission (FTC) took joint action against several e-liquid manufacturers who marketed their e-cigarette products to resemble candy, such as Warheads, or other kid-friendly flavors, such as Reddi-wip and Nilla Wafers. Commissioner Gottlieb has stated, “flavors play an important role in driving the youth appeal” of e-cigarettes. One survey of middle and high school students found that 43 percent who ever used e-cigarettes tried them because of appealing flavors.
The FDA has recently issued an advance notice of proposed rulemaking to seek public comment on the role flavors play in attracting youth to tobacco products, while also determining their value to adult consumers. Nevertheless, with the youth epidemic in e-cigarette usage still raging, the default agency position for addressing flavored e-cigarettes/liquids will be for the FDA to regulate them similarly to combustible cigarettes, i.e., instituting a ban on all flavors, save menthol.
The FDA is also heavily scrutinizing the marketing and advertising of e-cigarettes and e-liquids, which unlike other tobacco/nicotine products, are not presently banned on television and radio. A 2016 survey of middle and high school students found that 41 percent viewed advertisements on the internet, 38 percent on television, and 24 percent from newspapers and magazines. Moreover, this survey found that between 2014 and 2016, exposure to retail advertising among this sub-18 age group increased nearly 20 percent.
In September 2018, the FDA requested that the five e-cigarette manufacturers —JUUL, Vuse, MarkTen, blu, and Logic — who collectively represent over 97 percent of current U.S. market share for e-cigarettes, return with robust plans within 60 days on how they will convincingly address widespread use of their products by minors. It is unlikely that the industry will be capable of responding sufficiently to the FDA’s industry self-regulatory expectations.
The more likely regulatory scenario is that the FDA will require these brands to revise their sales and marketing practices, including online sales; desist from distributing their products to retailers who sell to underage consumers; and remove some or all of their flavored e-cigarette products from the market until they receive agency pre-market authorization and meet other applicable regulatory requirements.
E-cigarettes are not going to be removed from the market by the FDA; they will, however, be regulated similarly to combustible cigarettes as to limitations on marketing, advertising and product characteristics for those under the age of 18. As FDA Commissioner Gottlieb has stated repeatedly, e-cigarettes will remain accessible for those wanting to use them as a smoking cessation tool — just not at the expense of increasing American youth’s addiction to these nicotine-delivering electronic devices and e-liquids.
The recent epidemic of teenage e-cigarette smoking has the potential to halt the decline in U.S. adult smokers (as of 2016, at 15.5 percent). The FDA Commissioner knows all too well that the key to stopping adult users of e-cigarette or combustible cigarette users is by keeping America’s youth from starting this habit in their formative years. The e-cigarette industry is also acutely aware of this phenomenon. This is one of those public policy issues where substituting individual consumer preferences with a regulatory agency’s preferences is likely to benefit the long-term public health of America’s citizens.
[Originally Published at RealClearPolicy]