WASHINGTON -- In the wake of the U.S. Food and Drug Administration (FDA) “deeming” regulations going into effect Aug. 8, 2016, much of the conversation has centered on how the rule will affect the electronic cigarette and vaping industry. But with similarly strict regulations over cigars, and the announcement that the agency also intends to propose a rule that would ban the use of flavors in cigars, there’s as many—if not more—problems that might arise with the cigar segment.
Here are four of the most pressing concerns for cigars once deeming goes into effect ...
1. The premium problem
According to the Cigar Rights of America (CRA), the deeming regulations pose unique problems for premium-cigar manufacturers. “The only path to survival for all too many of our manufacturers of premium, handmade cigars is exemption,” said CRA executive director J. Glynn Loope. “The obstacles to keeping many cigars on the market or producing new blends would be insurmountable. In many ways, these proposed regulations are far more burdensome for premium cigars.”
2. Altria’s “mild” issue
Under the new regulations, John Middleton Co. LLC (a subsidiary of Altria Group Inc.) would be prohibited from using the word “mild” in its top-selling Black & Mild cigar brand. To protect its brand—which has been on the market for more than 40 years and generated $1.3 billion in sales last year—John Middleton filed suit to set aside the provision.
3. Application overload
Richmond, Va.-based cigar manufacturer Swedish Match estimates there’s anywhere from 7,000 and 9,000 cigar products alone that will require substantial-equivalence (SE) or premarket tobacco applications (PMTAs) under the new deeming rule. That’s a lot of applications for the FDA to review. “There’s a big backlog now—in the thousands—just from the 2009 regulations,” said Joe Teller, Swedish Match’s category management director.
4. The looming flavor ban
In somewhat good news, the overabundance of applications could result in a delay of the cigar flavor ban the FDA intends to propose. “I’m sure flavors are going to be addressed and potentially banned,” Teller says. “The question is, with all the SE and PMTA applications, how many things can the FDA really wrap its arms around?”