Analysis: FDA's Tobacco Transition

Zeller inherits a lot of uncertainty; will he bring quick answers?

Mitch Morrison, Vice President of Retailer Relations

Mitch Morrison

WASHINGTON -- Dr. Lawrence Deyton's surprising resignation last week as head of the FDA's Center for Tobacco Products is reaping mixed responses in the tobacco industry.

Deyton, who will be succeeded by FDA veteran Mitchell Zeller, has earned plaudits from some major tobacco companies and tobacco associations as a person they could talk to, someone accessible even if they didn't always agree with him.

And amidst fear of an activist federal arm that would seek to ban or overreach by severely restricting the legal sale of tobacco products to adults, Deyton brought a certain calm.

Hired in 2009 as the center's first director, Deyton sought to meet with all interested parties. That meant talking to medical and anti-tobacco groups, and equally important, it meant meeting with major manufacturers of cigarettes and other tobacco products and key trade organizations such as the National Association of Tobacco Outlets.

When it comes to access, Deyton scores well. But that's not the legacy he will leave. Deyton will be remembered as a fence sitter, someone who failed to tackle the big issues of the day.

Specifically, it has been nearly two years since the FDA's Tobacco Product Scientific Advisory Committee (TPSAC) recommended that "removal of menthol cigarettes from the marketplace would benefit public health in the United States."

Based on this report, many tobacco companies and analysts expected Deyton to take swift action--from more stringent labeling to other actions short of an outright ban. When I met with Deyton 10 months later in Jan. 2012, we asked if a decision on menthol were pending. He underscored that the TPSAC recommendation was just that, a recommendation, and that future action by the FDA concerning sale and distribution of menthol cigarettes would be based on multiple factors, including input from retail groups.

He offered no timelines, and predictions that a rendering was forthcoming proved wrong.

Likewise, the tobacco community is eagerly awaiting clarification on the status of electronic cigarettes, some forms of moist smokeless and oral products. Will any or all obtain a modified-risk designation, one that recognizes that the health effect from these vehicles is far less deleterious than that of cigarettes?

The Center for Tobacco Products is expected to issue a "notice of proposed rulemaking" by April concerning other tobacco products. What has frustrated suppliers is the lack of even a hint as to what this statement will cover.

Will it focus on cigars and specifically the fate of flavored products? Will it address electronic cigarettes and whether they should receive a different designation from traditional tobacco-based products? Will it consider different and less onerous warnings for moist smokeless, which many scientists say is empirically less harmful than cigarettes?

In his three-plus years, Deyton did well in building a trove of data and input from all affected parties but showed little interest turning that data into action. On quick glance, one could applaud his passive approach vs. a more activist model some now fear his successor will embrace.

But a growing number of tobacco advocates say the inaction has cost the industry in the tens, if not hundreds of millions of dollars that is sitting on the sidelines pending greater legislative clarity. Put another way, sometimes bad news is better than no news.

Cigar makers want to know if flavors will be permitted or banned. Big Tobacco wants to know how the FDA will classify e-cigarettes before jumping full force into this promising segment. Multiple segments want greater clarification about the future of oral tobacco products.

In her recent note concerning the transition from Deyton to Zeller, Wells Fargo tobacco analyst Bonnie Herzog said concerning the transition from Deyton to Zeller, "While Deyton was viewed as being somewhat open and conciliatory to the industry, there have been some questions as to how Zeller's relationship with the industry will unfold," she wrote. "Although right now the perception is that Zeller's appointment is not necessarily positive for the industry, we don't think it's as negative as some people might be fearing."

She added, "We think there will now be even greater visibility and a sense of urgency on the CTP which could result in actions being taken. We feel this could be a silver lining of Zeller's appointment. We feel any action--whether positive or not for the industry--will be beneficial as the relative inaction on items such as substantial equivalence approvals and menthol … has been an overhang [of uncertainty]."

Mitch Morrison Winsight CSP By Mitch Morrison, Vice President of Retailer Relations
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