Category: News This Week

As June 2016 marks the US Department of Housing and Urban Development (HUD)’s First Annual National Healthy Homes Month, Fontem Ventures is highlighting the role of Electronic Vapor Products (EVPs) in advancing one of the month’s key goals: making homes free of tobacco smoke. EVPs provide the nicotine that smokers desire without the tar, smoke, or secondhand smoke generated by cigarettes that burn tobacco.

As noted by the U.S. Centers for Disease Control (CDC), “the dangers of exposure to secondhand smoke are real – secondhand smoke kills more than 400 infants from Sudden Infant Death Syndrome and about 41,000 nonsmoking adults from heart disease and lung cancer each year.” The CDC also notes that about 58 million nonsmokers in the U.S. are exposed to secondhand smoke, some of which occurs in homes.

Public health experts have concluded that EVPs pose no risk to bystanders. [See: BioMed Central (2014); International Journal of Environmental Research and Public Health (2014); Nicotine and Tobacco Research (2013)]

“As many experts have agreed, EVPs provide the potential to make a significant public health benefit by providing smokers with an alternative that some studies have found to be up to 95 percent less harmful than products that burn tobacco,” said Marc Michelsen, Senior Vice President of Communications and Public Affairs at Fontem Ventures.

“When a smoker transitions from cigarettes to EVPs, they also help families and others in their home avoid the secondhand byproducts produced by cigarettes that burn tobacco,” Michelsen continued. “This advances HUD’s goal of promoting healthy homes.”

The National Healthy Homes Month program was developed to provide HUD with an opportunity to promote education about housing and its impact on health and provide resources to encourage local activities, as well as empower families to protect themselves from hazards in their home. The seven priorities of National Healthy Homes Month are childhood lead poisoning prevention, residential asthma intervention, injury prevention, smoke free public housing, safe indoor pest control, radon safety, and disaster recovery.

Dozens of e-liquid producers are being shut out of Indiana by a controversial state law that effectively makes a small security firm in Lafayette the vaping industry’s gatekeeper.

The impact, however, could extend well beyond producers. Retailers who must now find new sources for their product say the few producers who have been approved are charging much more, according to a story in the IndyStar. Ultimately, it is consumers who will have to pay higher prices, they say.

At issue are new regulations passed by state lawmakers in 2015 and revised earlier this year. The rules require any company that wants to produce e-liquid for sale in Indiana to be certified by a security firm by June 30.

The catch: So far only one security firm in the entire country qualifies to perform the work under the law – Lafayette-based Mulhaupt’s Inc. At this point, the company has approved only six producers, shutting out many existing competitors.

The law was billed as an effort to establish safety regulations for what had been a largely unregulated vaping industry. The law outlines specific conditions for manufacturing – that it occur in a clean room, for example – as well as requiring child-proof caps, detailed bottle labels and traceable batch numbers.on the products.

But now, critics are questioning why lawmakers would allow so few companies to dominate what had been a highly competitive market.

When asked if regulations were to force electronic cigarettes off the market entirely, 49 percent of U.S. respondents to a recent poll said they would go back to combustible cigarettes.

V2, one of the U.S.’ leading brands of electronic cigarette and vaporizer products, yesterday announced the results of a commissioned study examining electronic cigarette users’ reactions to the U.S. Food and Drug Administration’s decision last month to extend federal regulatory control to electronic cigarettes (and other products). Three hundred adult vapers across the U.S. were polled between May 16 and May 20.

As part of the FDA’s ruling, government approval of all electronic cigarette products and related consumables introduced to the market after February 15, 2007, such as e-liquid, is now required. These products must go through a formal approval process if they are to remain on the market and reports estimate that submitting an application for a single product approval could cost the applicant more than $1 million.

“Big Tobacco companies, with their virtually unlimited resources, benefit tremendously from an onerous and costly application process,” said Adam Kustin, V2’s vice president of marketing. “They have the ability to do it. And while our company is also well positioned, the smaller players in our category aren’t as fortunate. Some simply won’t be able to bring their products to market, while others will be forced to raise prices, further diminishing their competitiveness.

“Lastly, it’s important to recognize that Big Tobacco is under no obligation to submit any products for approval. They could accelerate the demise of the industry by simply withholding products from submission. Given the relative size of the e-cig industry to combustibles, I would say their motivation is low.”

When the survey respondents were asked what they would do if electronic cigarettes and e-liquid became harder to buy or more expensive, 36 percent said that ‘nothing would change’ and that ‘as long as they are available, I will buy them’. However, 34 percent said that they would vape less, while 18 percent said they would ‘vape less and smoke combustible cigarettes more’, and eight percent said they would switch back to smoking exclusively.

When asked if regulations were to force electronic cigarettes off the market entirely, 49 percent said they would go back to combustible cigarettes. Twenty-eight percent said they would stop consuming nicotine or tobacco products of any kind, and 17 percent said they would move to a smoking cessation method.

“E-cigs are ground-breaking technologies that offer an alternative to combustible cigarettes, which are harmful to millions,” said Kustin. “Almost half of respondents reported they’d return to combustible cigarettes if e-cigarettes were no longer available. The remainder said that they’d either use a cessation therapy such as nicotine gum, which we know doesn’t work; or they’d quit nicotine entirely, which is unlikely and unprecedented.

“In other words, if the FDA’s ruling hampers access or forces higher prices, it threatens to eliminate 99 percent of the industry, essentially driving vapers back into the eager arms of Big Tobacco. Such an outcome would be tragic, not to mention entirely inconsistent with the FDA’s earlier ‘continuum of risk’ rhetoric.”

Nicopure Labs, a leading manufacturer of American-made e-liquids, announced the appointment of Jim Caci to CFO. With more than 20 years of experience successfully managing risk, developing business strategy, leading the IPO process from start to finish, and building financial operations at private and publicly-held companies, Caci will be responsible for managing the strategy and growth of fiscal functions and operations at Nicopure Labs.

“I have become familiar with the Nicopure team over the last several years and have been impressed with their leadership position and success in the vaping industry,” said Caci. “As the industry continues to grow and go through major changes, I’m thrilled to be joining Nicopure at such an exciting time, and applying all that I have learned throughout my career to help contribute to the company’s long-term success.”

As the CFO, Caci will focus on developing performance measures and implementing tactical initiatives that support the strategic goals and long-term growth of the company. “Jim has earned himself a reputation globally as a financial operations expert in the technology industry,” said Jeff Stamler, CEO at Nicopure. “His professional know-how is the ideal match for our company’s relentless expansion and our commitment to maintaining high standards in all aspects of our business.”

Caci’s previous experience includes working as the CFO at Conductor, where he ran the company’s finance and administration, and AvePoint, where he helped build the company’s financial foundation and ran the finance and operations for all of the company’s global entities, across six continents. “Jim’s experience as the head of finance for two publicly held technology companies will give us a competitive advantage and unique insight where we are prepared for all possibilities,” said Stamler.

U.S. Food and Drug Administration (FDA) attempts to restrict flavors in vapor products were squashed by the Office of Management and Budget (OMB). The regulatory arm of the White House deleted language in a recently introduced “deeming rule” that would have removed flavored e-­cigarettes from the market until they had been authorized by the FDA, an edited version of the document shows, according to a story by Reuters.

As submitted by the FDA to the OMB, the rule gave a grace period for flavored products of only 90 days after the rule became effective. Proponents of vapor say the products can help people quit smoking and that flavors are a crucial element of what makes them attractive to adults seeking to quit. The FDA said in its original rule that evidence supporting such claims “is thus far largely anecdotal.” The rule requiring the ban was removed by the OMB,

The FDA provided pages of data and scientific studies in support of its plan, noting “a dramatic rise in youth and young adult use of typically flavored tobacco products, like e-cigarettes and waterpipe tobacco, and continued youth and young adult use of cigars.” The OMB deleted both the FDA’s planned policy and the rationale for the policy. A White House spokeswoman, Emily Cain, said the OMB “does not comment on changes made during the interagency review process.” The FDA also does not comment, FDA spokesman Michael Felberbaum said.

In its originally submitted rule, the FDA said it recognized that numerous flavored products would come off the market within 180 days of the rule’s publication “and that this will significantly impact the availability of flavored tobacco products at least in the short term.” But it said the move was important because tobacco products with characterizing flavors, including menthol but excluding tobacco flavor, were attractive to young people.

On May 5, the FDA announced a final rule extending its tobacco authority to include e-cigarettes, pipe tobacco, cigars and hookah. The rule becomes effective in early August. Under the rule, companies must seek marketing authorization for any tobacco product introduced after Feb. 15, 2007. The rule gives manufacturers a grace period of up to two years to submit marketing applications, during which they can continue to sell their products. They can sell them for an additional year while the FDA completes its review.

As its government rolls out its plan for tobacco plain packaging, New Zealand is also eyeing legalizing nicotine-laced e-cigarettes, according to a story on the New Zealand news website Newshub.

Currently if the products contain nicotine or claim to help people give up smoking, they are illegal. Many smokers have credited e-cigarettes with helping them to quit the habit, according to the story.

The proposal has received the backing of ACT leader David Seymour and Maori Party co-leader Marama Fox. “There’s no downside for legalizing e-cigarettes,” says Seymour.”The reality is it’s the tar that kills you from smoking, and if I had a choice from being addicted to tar or to vapor, I’d choose vapor every time.”

However, the original advocate of plain packaging in New Zealand who initiated the war on tobacco, Dame Tariana Turia, says e-cigarettes and vaping are not the solution. “I’ve never believed at any time that we should be legalizing anything that continues to facilitate cigarette smoking, and that’s what e-cigarettes does,” she said.

The Smoke-Free Alternatives Trade Association (SFATA), the largest trade association representing and protecting the interests of the vapor industry, announced it has grown to more than 1,000 business members while establishing 27 local chapters in 25 states throughout the country.

“We are proud to continue to represent the small businesses that primarily make up our industry, which is creating jobs and billions of dollars in revenues and economic activity,” said Cynthia Cabrera, president and executive director of SFATA.
“Advocating with a united and informed voice at the state and federal levels is paramount to the industry’s success, and we are committed to providing the resources to help our organization’s members navigate the increasingly difficult regulatory and legislative environments.”

Founded in 2012 with only a handful of members, SFATA today has grown into the largest vapor trade association, supported by businesses across the entire supply chain, including online retailers, brick and mortar vendors, distributors, manufacturers, professional service providers, importers and wholesalers.

SFATA also maintains committees comprised of members and leading industry thought leaders, including political, regulatory policy advisors, as well as top academics and scientists. The association also retains the foremost legal and public relations firms nationally, and employs top-tier state and federal lobbyists to advocate for the industry and educate legislators, health and regulatory agencies, and media, on vaping products.

“As we fight regressive policies that threaten our industry and the lives of smokers by treating vapor products, which contain no tobacco, more harshly than combustible cigarettes, it is vital now more than ever that the industry come together to fight for the preservation of this category, and not let the FDA hand the industry over to big tobacco,” added Cabrera.

It was funny because it was too close to being true. Twitter suspended a spoof account of the Food and Drug Administration’s (FDA) Center for Tobacco Products after the account mocked the FDA’s e-cigarette policy.

Jeff Stier, senior fellow at the National Center for Public Policy Research (NCPPR) and one of the nation’s leading critics of the FDA’s e-cigarette crackdown, set up the account to mock the agency’s monotonous Twitter feed.

“I set up a spoof twitter account- clearly identified as such- called FDATobaccoBot to parody the FDA’s absurd bot-like twitter account,” Stier told The Daily Caller News Foundation via email. “To avoid any confusion, I explained in the account’s bio: This is the #FDA Tobacco Bot Spoof Account. Send me questions about your tobacco #Ecig products,” Stier added.

“The account is obviously a spoof,” said NCPPR. “But it is also incisive political parody. For instance, when someone asked the spoof account about the Royal College of Physicians report that recommends doctors widely publicize e-cigarettes to their smoking patients, the spoof account responded: “RCP #Ecig report irrelevant rubbish to U.S. policy-making: English English differs from U.S. English significantly.”

No reason was stated in the story as to why Twitter shuttered the parody account.