SOI 2019: FDA Places Flavored Tobacco in Crosshairs

Speakers express concern over proposed guidance polices
Photograph: Shutterstock

CHICAGO — While tobacco category managers have been concerned for some time about the U.S. Food and Drug Administration’s (FDA's) focus on flavors in vaping devices, cigarettes and cigars, speakers at the recent NACS State of the Industry (SOI) Summit raised the issue generally, saying it was one of the biggest challenges facing the industry in the coming year.

In particular, SOI speakers focused on the FDA’s development of an updated guidance policy for the regulation and enforcement of its tobacco rules. One of the more controversial aspects of the document is a proposal to limit the sale of flavored e-cigarettes to stores that only allow in customers 21 and older or stores with a section that minors are not allowed to enter, possibly a store-within-a-store.

Another controversial proposal is placing flavored cigars introduced after 2016 (that did not have agency approval) subject to enforcement action and removal. Officials with the Lakeville, Minn.-based NATO discussed both concerns during a recent webinar.

At the SOI event, Charlie McIlvaine, chairman and CEO of Coen Oil Co., Canonsburg, Pa., said menthol and flavors in general represent 35% of units and 34% of cigarette sales, citing data from Chicago-based SwiftIQ. He said cigarettes in general are traditionally No. 1 across all in-store merchandise categories in sales dollars and represent a bulk of the overall tobacco category.

Flavors generally play a huge role with cigars and e-cigarettes, McIlvaine told SOI attendees on April 3. Flavored cigars, including menthol, represent 46% of units and 51% of sales at c-stores, while flavored e-cigarettes represent 76% of units and 79% of sales, he said, citing SwiftIQ.

According to Nielsen numbers, e-cigarettes saw a 179.4% gain in sales and a 98.2% gain in units, with cigars showing an 8% gain in sales and a 7.4% gain in units in 2018. If the FDA guidance has its intended effect, McIlvaine said, “the whole thing slides negative,” referring to overall OTP gains seen in 2018.

McIlvaine encouraged attendees to reach out to the FDA with their perspectives on the proposed new policies.

Many following the tobacco industry have reservations about the methods the FDA is using to achieve its goals, inclusive of its March 13 release of the draft guidance. Saying this isn’t the first time the FDA has tried to “regulate by guidance,” Jonathan Havens, chair of the food and beverage group for Saul Ewing Arnstein & Lehr, Washington, D.C., told CSP Daily News in March that the agency’s newly released draft guidance, when finalized, would be nonbinding, but it could have the same effect as regulations by prioritizing how the FDA would initiate enforcement action.

Those protocols surfaced in recent weeks when the FDA filed complaints seeking a 30-day ban on selling tobacco products at two stores, as well as issuing statistics on alleged violation rates for certain c-store chains and gas stations.

On a practical level, the biggest difference between a guidance and a regulation is time. The guidance-making time frame could be a few months, while the more formal regulation-setting process—known as “notice-and-comment rulemaking,” according to Havens—is a multistep endeavor involving advance notice of proposed rulemaking (ANPRM); a proposed rule; a final rule and public comment; and FDA consideration and response to the same along the way. FDA notice-and-comment rulemaking has been known to take years.

To restrict the sale of certain products, the FDA would have to go through formal rulemaking, Havens said.

All this activity comes just after FDA Commissioner Scott Gottlieb announced his resignation as of this spring. A crackdown on the ability of young people to purchase electronic cigarettes and an effort to make generic drugs more accessible are just two of the wide-ranging issues that Gottlieb oversaw during his almost two-year tenure.

In his own tweet, Gottlieb said he was “immensely grateful” for the opportunity to lead the agency since May 2017, adding “this has been a wonderful journey and parting is very hard.”

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