Tag / Food and Drug Administration

by Mike Poverello

E-cigarettes increase on the back of traditional tobacco advertising – will regulation follow?

o-ECIGS-570It seems the ‘e-industry’ is the vehicle for the next generation of contraband and illicit goods and Im not alluding to the electronics and entertainment industry here. While the World Health Organisation urges a ban on marketing of e-cigarettes, will the need for governments to consider taxes on such become necessary …read on:

E-cigarettes are following in the footsteps of their none-lectronic predecessors by utilizing advertising means no longer available to traditional cigarettes and increasing their ad spending on techniques such as television commercials, promotions, events, sample giveaways, celebrity endorsers, and slogans such as “A perfect puff every time.”

Electronic cigarettes are battery-powered devices that heat a nicotine solution into a vapor inhaled by users. While the chemicals of tobacco cigarettes are not included, the addictive feature of nicotine remains. The use of e-cigarettes has climbed steadily, with 6 percent of all adult Americans and 21 percent of adult smokers trying them in 2011, nearly twice the rates in 2010, according to the Centers for Disease Control and Prevention.

Unlike tobacco cigarettes, which are heavily regulated, e-cigarettes are free from laws that limit their methods of marketing. As a result, brands such as Blu eCigs have spent $12.4 million on advertising for the first quarter of 2013, up from less than $1 million last year. They feature endorsements from actor Stephen Dorff and personality Jenny McCarthy. Traditional cigarette companies such as Lorillard and Reynolds are also getting in on the action by purchasing or launching their own lines of e-cigarettes.

The advertising itself even references tobacco cigarettes, with campaigns that seek to make smoking acceptable again. In a Blu eCigs ad, for example, Dorff praises e-cigarettes because they can be smoked “at a basketball game . . . in a bar with your friends . . . virtually anywhere,” adding, “Come on, guys, rise from the ashes.”

But with the increased profile may come regulation.

“It is beyond troubling that e-cigarettes are using the exact same marketing tactics we saw the tobacco industry use in the ’50s, ’60s and ’70s, which made it so effective for tobacco products to reach youth,” Matthew L. Myers, president of the Campaign for Tobacco-Free Kids, told The New York Times. “The real threat is whether, with this marketing, e-cigarette makers will undo 40 years of efforts to deglamorize smoking.”

WHO urges countries to adopt global guidelines that will end the indoor use of e-cigs. WHO also calls for a ban on marketing practices that could encourage children and non-smokers to use e-cigs.

States such as Indiana, New Jersey, North Dakota, Mississippi, and Utah have already extended restrictions on tobacco cigarettes to include e-cigarettes, while other states such as California and Pennsylvania are considering similar laws. Inhalation of e-cigarettes is prohibited on Amtrak trains and onboard U.S. planes.

The Food and Drug Administration is said to be planning the release of proposed regulations in October. Referencing a report from the financial group CLSA Americas, AdAge reported that the agency is expected to propose a ban on TV advertising to set limits on sales to minors, implement the possibility of a warning label, and restrict online sales. An FDA spokesperson said she could not comment on specifics of a proposed rule, but that the agency “intends to propose a regulation that would extend the agency’s ‘tobacco product’ authorities – which currently only apply to cigarettes, cigarette tobacco, roll-your-own tobacco, and smokeless tobacco – to other categories of tobacco products that meet the statutory definition of ‘tobacco product.’ Further research is needed to assess the potential public health benefits and risks of electronic cigarettes and other novel tobacco products.”

Why it matters: The increasing use and potential regulation of e-cigarettes may trigger another round of tobacco wars between industry and the government. Debate about the product remains – is it an alternative form of smoking, or a means of quitting, like nicotine gum? Should e-cigarettes be taxed and regulated like traditional tobacco products, with age limits, warning labels, and a ban on certain forms of advertising such as TV, or are they a separate and distinct category of products? If and when the FDA wades into the issue, the fight will truly begin. Source: Manatt Phelps & Phillips LLP

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by Mike Poverello

Tobacco industry uses trade pacts – to snuff out anti-smoking laws

Anti-tobaccoAs countries around the world ramp up their campaigns against smoking with tough restrictions on tobacco advertising, the industry is fighting back by invoking international trade agreements to thwart the most stringent rules.

A key battlefront is Australia, which is trying to repel a legal assault on its groundbreaking law requiring cigarettes to be sold in plain packs without distinctive brand logos or colors. Contesting the law, which came into effect Dec.1, are the top multinational cigarette makers and three countries — Ukraine, Honduras and Dominican Republic — whose legal fees are being paid by the industry.

The dispute underlines broader concerns about trade provisions that enable foreign companies to challenge national health, labor and environmental standards. Once a country ratifies a trade agreement, its terms supersede domestic laws. If a country’s regulations are found to impose unreasonable restrictions on trade, it must amend the rules or compensate the nation or foreign corporation that brought the complaint. In the case of Australia’s plain packaging law, the tobacco industry and its allies are challenging the measure as a violation of intellectual property rights under trade agreements the nation signed years ago.

Public health advocates fear the legal attack will deter other countries from passing strong measures to combat the public health burdens of smoking. The “cost of defending this case, and the risk of being held liable, would intimidate all but the most wealthy, sophisticated countries into inaction,” said Matthew L. Myers, president of the Campaign for Tobacco–Free Kids in Washington D.C.

The advocates also say countries should be free to decide how best to protect public health, without being second-guessed by unelected trade panels. Moreover, they argue, tobacco products, which kill when used as intended, should not be afforded the same trade protections as other goods and services. Worldwide, nearly 6 million people a year die of smoking-related causes, according to the World Health Organization, which says the toll could top 8 million by 2030. With fewer people lighting up in wealthy nations, nearly 80 percent of the world’s 1 billion smokers live in low and middle-income countries.

Marlboro, the world’s top-selling brand, packaged under labeling laws of (clockwise) the U.S., Egypt, Djibouti, Hungary/Photos of non-U.S. packs, Canadian Cancer Society

Marlboro, the world’s top-selling brand, packaged under labeling laws of (clockwise) the U.S., Egypt, Djibouti, Hungary/Photos of non-U.S. packs, Canadian Cancer Society

Countries have been emboldened to pass more stringent measures by the Framework Convention on Tobacco Control. In effect since 2005, the treaty has committed about 175 nations to pursue such measures as higher cigarette taxes, public smoking bans, prohibitions on tobacco advertising, and graphic warning labels with grisly images such as diseased lungs and rotting teeth (The U.S. has signed the treaty, but the Senate has not ratified it. The U.S. Food and Drug Administration has ordered graphic warnings for cigarette packs, but an industry court challenge on 1st Amendment grounds has stalled the rule.)

Cigarette makers say they acknowledge the hazards and the need for regulations. “We actually support the vast majority of them,” said Peter Nixon, vice president of communications for Philip Morris International, which has its headquarters in New York, its operations center in Switzerland, and is the biggest multinational cigarette maker with 16 percent of global sales.

But the industry has watched with growing concern as more than 35 countries have adopted total or near-total bans on cigarette advertising. Its big profits depend on consumer recognition of its brands. Yet in many countries, the once-ubiquitous logos and imagery are receding, leaving the cigarette pack as a last refuge against invisibility.

Now the pack, too, is under attack. Along with plain packaging laws such as Australia’s, countries are weighing retail display bans that keep cigarette packs out of view of consumers, and laws requiring graphic health warnings so large that there is barely any room for trademarks. Tobacco companies contend that countries enforcing such rules are effectively confiscating their intellectual property and must pay damages.

The industry also claims that measures like plain packaging are counterproductive. “We see no evidence — none at all — that this will be effective in reducing smoking,” Nixon of Philip Morris International said in an interview. In fact, he said, generic packaging likely will increase sales of cheap, untaxed counterfeit smokes, thus increasing consumption (my emphasis added).

Comment: And for me this is the bottom line. Governments are happy to collect the ‘sin tax’ every year, most increasing it annually under the pretext of curbing the use of alcohol or tobacco products. Forcing draconian law will only increase the contraband ‘underground’ which these same governments have little control over. The worldwide push under the WHO banner appears to have more of a ‘social conditioning’ connotation than a health one.

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