The European Parliament is set to vote Tuesday on proposals to regulate electronic cigarettes as part of a new tobacco control directive. This legislation directed toward minimizing smoking and access to minors in particular includes a provision to limit e cigarettes by treating them like medications in terms of approval to bringing products to market.
Europe is hardly known for its success in minimizing smoking after all, the highest rates of smoking are all in Eastern Europe, but movement by Parliament will likely encourage the U.S. to also re examine its own already controversial regulations over e cigarettes.
Smokeless smoking?
E cigarettes are small battery powered cigarettes that vaporize a solution of nicotine, the compound in cigarettes known to activate the nucleus acumbens in the brain, a center that triggers the reward cascade and is essential in establishing addiction.
This dose of nicotine provides the hit that smokers crave, without the impurities and tobacco of traditional cigarettes that are known to cause most of the detrimental health effects of smoking.
In theory, e cigarettes should provide a much healthier alternative to smokers unable to break the habit. In analogy, methadone is the “alternative” for heroin addicts, giving them a doctor prescribed and highly regulated dose of maintenance level opioid and controlling the detrimental behavioral and health effects of street heroin.
The big 3
Since the popularity of e cigarettes has risen, leaders in the tobacco industry have been acquiring e cigarette companies. If European regulations tighten on e cigarettes, it could drive market share to tobacco if these regulations do not pass, tobacco can reign supreme. For tobacco companies that already have their own e cigarette divisions, movement will more likely cause shifting of dollars within the corporation rather than an outflow of revenue.
Lorillard , the third largest tobacco company in the U.S. with 14.5% market share of traditional cigarettes, has been a leader in the e cigarette industry since their popularity arose. Known for cigarette brands Newport, Maverick, Kent, and True, Lorillard acquired Blu eCigs in April 2012 for $135 million, establishing it as a leader in the e cigarette industry. Blu eCigs currently accounts for 37.2% of the e cigarette market.
Lorillard has more at stake than the rest of the big 3 with Parliament’s upcoming vote. The U.S. based company acquired this past month UK e cigarette brand SKYCIG for 30 million pounds with an additional 30 million pounds due in 2016 upon achieving certain criteria. The acquisition was to establish a significant European presence for Lorillard, but if legislation passes to limit e cigarettes, this investment may have lower yield than hoped.
Reynolds American , the second largest tobacco brand with 23.5% of traditional cigarette market share, is known for cigarette brands Camel and Pall Mall. Reynolds has Vuse as its e cigarette arm and revamped its product this summer, planning on expanding beyond its Colorado market to the rest of the country.
Arguing that it has superior technology in delivering consistent vapors, Reynolds has been focusing heavily on marketing, recently launching a TV marketing campaign for Vuse. Legislation in 1971 banned TV advertising for cigarettes, but has yet to apply that to e cigarettes Reynolds is capitalizing on that loophole before it is likely closed.
Philip Morris International and Altria Group , known for Marlboro, are the biggest of the big 3, with Altria responsible for the U.S. market and Philip Morris International being the spin off from Altria that’s responsible for the international market. Altria controls 47.3% of the market share of traditional cigarettes and is also the leader in smokeless tobacco products but was the last of the big 3 to roll out an e cigarette. Altria recently launched its first e cigarette, MarkTen, under its Numark subsidiary this past summer.
While the big 3 dominate the e cigarette space, several companies are still formidable anklebiters. Privately owned Njoy may lead that category, owning 32% of the e cigarette market share. The company recently raised $75 million, with high profile investors including Sean Parker of Napster, Douglas Teitelbaum of Homewood Capital, and musician Bruno Mars.
Blowing smoke up investors’ bottom(line)s?
The e cigarette industry is certainly a force to be reckoned with. E cigarette sales are expected to double this year to between $1 billion to $1.7 billion. While tobacco sales are on the order of $80 billion, Bloomberg projects e cigarette sales surpassing that of traditional cigarettes by 2047. At Reynolds, analysts have estimated that its traditional cigarettes will outsell its e cigarettes only until 2021 the same analysts have estimated similar dates for Altria and Lorillard.
Anti tobacco lobby groups are lobbying hard to restrict e cigarettes but for the time being, FDA regulation has been lax at best and scientific evidence is still in development over potential harms of e cigarettes, crippling the government’s ability to justify strict regulations. The FDA has also been considering restrictions on online sales of e cigarettes in an attempt to minimize access by minors.
Currently the FDA states that the safety and efficacy of e cigarettes “have not been studied,” in terms of safety for intended use, inhalation dosages of nicotine and other chemicals with e cigarettes use, and benefits of use. Some studies have scrutinized the safety of e cigarettes after finding trace amounts of carcinogens, including formaldehyde, acrolein, and propylene glycol. Many criticisms of e cigarettes revolve around the marketing of e cigarettes as a way to taper smokers as the use of flavored e cigarettes as a way of targeting kids the FDA currently only regulates e cigarettes marketed for therapeutic use.
By anecdote, several addiction specialists in my practice suggest electronic cigarettes to patients as an alternative to smoking and as a way to bridge to complete cessation. Patients report that it helps them maintain the social function of smoke breaks, as well as the comfort they associate with the physical act of smoking many praise it as the only remedy successful to help them kick tobacco.
The movement within medical management of tobacco addiction mirror what analysts are saying about the e cigarette industry that it is growing and quickly. Even with regulations constantly in flux, there appears to be a significant movement of proponents of e cigarettes in medical practice. No physician would ever prescribe cigarettes, but several would suggest e cigarettes this general acceptance will likely make regulations more difficult and the e cigarette industry more profitable.
Eu rules to ban menthol cigarettes
Why the eu’s proposed ban on refillable electronic cigarettes is a good idea! / escape vapourettes
Health warnings covering 65% of cigarette packs are to be introduced and menthol cigarettes banned under new EU rules approved today PA
The European Parliament in Strasbourg voted on a raft of measures to help curb smoking but stopped short of introducing plain packaging for cigarettes and tobacco.
Legislators put new limits on advertising for electronic cigarettes but have so far rejected proposals for them to be regarded as medicinal products.
Menthol and other flavours will be banned but there is to be no ban on packs of slim cigarettes.
Some campaigners had called for e cigarettes to be subjected to the same regulation as nicotine replacement therapies (NRT) such as patches and gum.
E cigarettes consist of a battery, a cartridge containing nicotine, a solution of propylene glycol or glycerine mixed with water, and an atomiser to turn the solution into a vapour.
While nicotine is the addictive substance that keeps smokers hooked, Cancer Research UK said it is the toxic cocktail of chemicals in tobacco smoke that kills half of all long term smokers.
The lack of tobacco in e cigarettes means they are “almost certainly” a much safer way of getting a nicotine hit than smoking cigarettes, it added.
Liberal Democrat MEP Chris Davies said after the vote “E cigs can be a game changer in the fight against smoking. Hundreds of former smokers have written to tell me that they have helped them give up cigarettes when nothing else worked.
“They are successful because they are not medicines but products that smokers enjoy using as an alternative to cigarettes.
“Every year 700,000 people in Europe die of smoking related disease. We should not do anything that makes e cigs harder to obtain than tobacco cigarettes.”
Adrian Everett, chief executive of e cigarette brand E Lites, said “This is a fantastic result for public health and the millions of smokers around Europe who are switching to e cigarettes.
“We would have been in the absurd position of the Department of Health making it much easier to make and sell tobacco cigarettes than e cigarettes which are vastly less harmful.
“Following the European Parliament’s decision, we hope to work with the UK Government to agree a regulatory framework for e cigarettes which reinforces the existing consumer protection regulations.”
Conservative MEP Martin Callanan said ” Forcing e cigs off the shelves would have been totally crazy.
“These are products that have helped countless people stop smoking more harmful cigarettes and yet some MEPs wanted to make them harder to manufacture than ordinary tobacco.
“I have received countless emails and calls from ‘vapers’ which were individual personal pleas, not a standard letter copied and pasted from an NGO website as we MEPs often see.
“Many electronic cigarettes are produced by small businesses who would simply not have been able to afford the strict authorisation demands the EU would place on them.
“We could not stand by and allow MEPs to put companies out of business and people out of work.”
Tom Rolfe, president of the Skycig brand of e cigarettes said “Skycig welcome any regulations which will help us to ensure that under 18s cannot access electronic cigarettes and to ensure that all e cigarette companies must produce products of a high standard, in the same way that Skycig and other reputable e cigarette companies do.”
Today marked the European Parliament’s first reading of a draft tobacco directive which could become law in 2014.
MEPs voted to put health warnings on 65% of each cigarette pack, as opposed to the proposed 75%.
At present, warnings should cover at least 30% of the front and 40% of the back of cigarette packs, with a border surrounding them.
The Medicines and Healthcare products Regulatory Agency (MHRA) has said it intends to make e cigarettes medicinal products but today’s decision could alter those plans.
An MHRA spokesman said “The UK Government’s position is that the public health priority of reducing the harms of smoking can best be achieved by the regulation of nicotine containing products (NCPs), including electronic cigarettes, under the medicines framework and supports the European Commission’s Tobacco Products Directive.”
Once agreed, all 28 EU countries will have to make the measures law.
The ban on menthol cigarettes will come into force in 2022.
Deborah Arnott, chief executive of Action on Smoking and Health, said “We are pleased that MEPs recognised the importance of increasing the size of health warnings and that these will be placed at the top of the packs to make them more visible.
“Despite unprecedented levels of lobbying by the tobacco industry to undermine the directive it is gratifying that MEPs stood firm on many of the key measures.
“We now urge the Council, the Commission and the Parliament to strongly defend the directive in ongoing negotiations.”
Angela Harbutt, campaigns manager of the smokers’ group Forest, said ” Consumers will have mixed feelings.
“We welcome the fact that some products have been reprieved while menthol cigarettes have been given a stay of execution, but consumers are still angry that the EU is trying to restrict or ban products they have purchased and enjoyed for many years.
“Prohibition doesn’t work and products that are banned will almost certainly be available on the unregulated black market.
“Law abiding consumers will be at a serious disadvantage and it won’t help children because criminal gangs don’t care who they sell to.”
A spokesman for British American Tobacco said “We’ve always said that we support sensible, balanced regulation that takes into account all the people it will impact before being decided on and implemented.
“We have made it clear throughout this process that many of the proposals on the table were not proportionate, were unlikely to succeed in addressing public health objectives, and would lead to an increase in black market sales.
“Although there are clearly many differing opinions among MEPs when it comes to this directive, it appears as if some sensible modifications have been made.
“However, much of this directive remains disproportionate and could be in breach of European law.
“For example, health warnings covering more than half of the cigarette pack goes well beyond what is needed to fully inform consumers of the health risks and a ban on mentholated cigarettes will only increase the demand for black market goods.
“In banning menthols, the European Union has forced millions of consumers to turn to the black market to get access to the product they want.
“The weight of evidence shows that smokers of menthol cigarettes face no higher risk of tobacco related diseases than smokers of non menthol cigarettes, that they find it no more difficult to quit and that the availability of menthol cigarettes does not increase youth initiation of smoking.
“Banning menthol in cigarettes is not justifiable based on the available scientific evidence.”
On graphic warnings, the spokesman added “We strongly oppose the standardisation of our products. No evidence has been presented to justify why it is deemed necessary to restrict the dimensions or colours of a package or the way in which it can be opened.”
Maura Gillespie, policy programme director at the British Heart Foundation, said “MEPs have missed an opportunity to make real inroads into curbing the number of young people taking up smoking.
“It’s positive news that cigarette warnings are getting substantially bigger but MEPs could and should have gone further.
“Research shows health warnings that take up 75% or more of a cigarette box are more effective at reducing the attractiveness of products among our young people.
“The ban on flavoured tobacco is also welcome but it’s extremely disappointing slim cigarettes have not been banned.
“They’re dangerous products often targeted at young women that can mislead p
eople about the harms of smoking.
“Now it’s up to the UK Government to show they’re made of stronger stuff and introduce standardised packs, stripped of attractive branding, without delay.”