Category: This Issue

Fighting for Survival

Photo Credit: Peggy und Marco Lachman / Photo Illustration by Mike McDonald
By Maria Verven
Char Owen and Amanda Wheeler knew the enormous uphill battle other vape business owners would face when pulling together their premarket tobacco product applications (PMTA) for the U.S. Food and Drug Administration (FDA). After all, the PMTA process—which the FDA has foisted on thousands of small business owners—had been built for billion-dollar tobacco manufacturers. Every flavor in every nicotine level—even the smallest differences—needed its own PMTA, and each PMTA cost hundreds of thousands of dollars.
Add it all up, and some manufacturers had to submit PMTAs for more than 2,000 products. The costs will be astronomical—estimated in the hundreds of millions. Aside from the costs, there’s another huge hurdle: Very few vape business owners have information technology experts or paid scientists on staff—the kind of expertise necessary to submit the extensive paperwork required by a PMTA.
And what about the help for small businesses that the FDA promised? It never arrived. So Owen and Wheeler stepped up to help their colleagues. After downloading the complete list of manufacturers from the FDA site, they called each and every one to announce their new group, simply called PMTA Sharing.
Ultimately, the group grew to 1,700 members, including vape businesses all across the country as well as several suppliers that offered to pitch in to help business owners through the PMTA process. The group’s services are completely free; the only fee members pay is for environmental assessments or cover letters and forms created by industry attorneys.
Thus far, the PMTA Sharing group has helped more than 200 businesses submit PMTAs for 1.7 million products. But Owen and Wheeler didn’t stop there.
They’re now starting a new nonprofit trade association called American Vapor Manufacturers (AVM) to help small businesses meet the FDA’s onerous scientific testing requirements (see sidebar).
Here’s their story.
Vapor Voice: Tell me more about your vapor businesses. How have your businesses fared over the years?
Owen: I own two brick-and-mortar vapor shops as well as a very small wholesale line. We started in 2013 as a labor of love dedicated to my father whom I lost from lung cancer in 2001. I’ve since gained more friends in my little town of Seguin, Texas, than I can count. We all have one common goal—keep people away from combustible tobacco.
We lost some sales due to the EVALI (e-cigarette or vaping product use-associated lung injury) scare, but thankfully most did not return to smoking, and those who did are slowly returning to vaping. Our retail lobby had to close during the shutdowns in Texas, but I fought extremely hard and was able to at least keep curbside service available. So while we lost a bit of sales, we didn’t have to close. We are grateful, as many others were not so lucky.
Wheeler: I own Jvapes E-liquid, founded in 2011, headquartered in Prescott, Arizona, with stores in Arizona, Colorado and Oklahoma. We also sell online at www.jvapes.com and wholesale at www.wholesalejvapes.com.
Both my husband and I are former smokers who quit with vaping. At the time, vapor products were not widely available in our local community. We started out with a tiny 400-square-foot store, but the response to vapor products was so positive, our business quickly grew into what it is today.
With the exception of late 2019 and misinformation surrounding EVALI, our business has fared very well over the years as people have seen for themselves the effectiveness and positive change from vaping. Our target audience are cigarette smokers, age 49 on average, who have not been able to quit by other means. We learned during our PMTA data collection that 83 percent of our customers have quit smoking entirely.
Have you been involved in vape advocacy?
Owen: I have been involved with advocacy in Texas for the last three years through SFATA [the Smoke Free Alternatives Trade Association] and have also been involved with federal advocacy. I am a member of SFATA, USVA [U.S. Vaping Association], a monthly supporter of CASAA [Consumer Advocates for Smoke-Free Alternatives Association] and am now the vice president of our new company, AVM.
Wheeler: I am the president of Rocky Mountain Smoke Free Alliance, our Colorado trade association. I’m also executive director of the Arizona Smoke Free Business Alliance where I’ve worked on everything from vapor taxes to flavor and public vaping bans to licensing. Prior to starting AVM, I was involved in federal advocacy for PMTA reform where we spent over a year lobbying Health and Human Services [HHS] to have small business PMTA applications accepted.
When and why did you start the PMTA Sharing group?
Owen: I was in the process of doing my own PMTAs. As a 20-year computer engineer, I had an extensive history in document replication and information technology, so I knew I could create the documents I needed. But I also knew that most small businesses did not have the same ability. Most could not even use Microsoft Excel.
I started the PMTA Sharing group on Feb. 17, 2020—a significant date for me because it was my son’s birthday. I lost my son in 2013 just a few weeks before we opened our first brick-and-mortar store. I tried many times to help him quit cigarettes but was never successful.
So after filing our own PMTAs, we created applications for other businesses to create and file their documents and then held Excel training classes. We even did computer support when their machines were unable run the applications, implemented a Microsoft OneDrive for data collaboration, and created training videos and step-by-step instructions.
Amanda Wheeler
Wheeler: I began advocating for a streamlined PMTA process for small businesses. I knew that my business as well as my state’s group members and most independent vapor manufacturers would not have the financial resources to complete the full PMTA process. Without significant changes to the process, only large corporations would survive PMTA regulations.
Does the work keep you up at night?
Owen: Helping the group submit PMTAs was a monumental undertaking, requiring 14[-hour] to 16-hour workdays most of the time. It has taken a toll on both my physical and mental health.
We put as much effort as was needed to make sure no one would be left behind. We’ve received tons of feedback [see testimonials] and gratefulness for our group. They now have hope that their small businesses can continue to help people who have quit and those who want to quit smoking.
It’s an amazing feeling when you’re walking in your town and someone who has smoked for 30-plus years recognizes you and gives you a hug because they can finally live a life away from combustibles. We all feel that same joy with each and every person who puts down cigarettes.
I remember one lady who called me to thank me, explaining that if it wasn’t for our group, she would have no means to support herself and her two-year-old daughter. Of course that makes me happy, but also very angry that the FDA put her in that situation and treated her as if she was a big tobacco business with all the resources necessary to meet their requirements.
Char Owen
The FDA has publicly acknowledged that the costs associated with the PMTA process may be challenging to small businesses and that many would go out of business. That is not how our government is supposed to operate.
What else do people in the vapor industry need to know that would help and motivate them?
Owen: We are optimistic that we will complete this process through sheer determination. While we don’t expect help from the FDA, the HHS has been willing and open to listen to our challenges.
We hope to move the group through to the testing phase and move the membership to the AVM. We have accomplished the monumental task of completing the first part of the process. It will be difficult, but we will move as many small businesses through the entire process as soon as we possibly can.
Our colleagues in the vapor industry need to know that we will not stop fighting for them. We understand what they are facing better than anyone. We are them. There is no one better to fight for small manufacturing than small manufacturers. Our hearts are fully invested in this industry.
Wheeler: I am optimistic. We have a very solid plan and approach, and we have the right scientific, legal and lobbying expertise to get the job done. Many passionate and dedicated individuals are on the AVM board, guiding our organization in the best interests of small businesses.
We are unified and moving together toward the same goal, and I believe we have a recipe for success.
The original “Vaping Vamp,” Maria Verven owns Verve Communications, a PR and marketing firm specializing in the vapor industry.
December 28, 2020
Predicting the PMTA

Credit: Andikatalinmueller
By Mike Huml
The U.S. Food and Drug Administration’s (FDA) dreaded deadline for its premarket tobacco product application (PMTA) has come and gone after multiple delays. With all that’s happened this year, it may have gone unnoticed for many. Rest assured that the process of submitting a PMTA has been long and tedious for manufacturers and vendors alike, and they have been working hard to ensure that reduced-risk products remain available for as long as possible.
Many companies have been working tirelessly to submit their applications, but the process is fairly opaque and uncertain. The filing of the PMTA does not ensure FDA acceptance, and each product must be filed separately. Currently, it is largely unknown which specific products have been submitted for FDA approval.
What is known, however, is which companies intend to submit or have already submitted a PMTA and how far along they are in the process. Keep in mind that being further along in the approval process is not necessarily an indicator of success. No vapor company at the time of this writing has received FDA approval for any product, and the length of time each submission will remain within the approval process is unknown. With so many unknowns, it can be difficult to predict which products will be legal to carry, if any. By looking at which companies are taking part in the PMTA process along with their histories, one can make reasonable assumptions as to which direction the vapor industry will begin to sway.
First, the bad news. Given that each PMTA is only valid for one “distinct new tobacco product,” and that even the smallest difference in the design of a product could warrant an entirely new SKU, it’s only reasonable to assume that there will be massive consolidation of vapor products. Products that are too similar will need to reconcile, either by being discontinued or redesigned. Even identical products with different colors, flavors, resistances or nicotine strengths could be considered separate SKUs, with each requiring its own PMTA, which has proven to be prohibitively expensive.
The massively varied choices that vapers have in products is undoubtedly going to shrink, but by what degree? A mod is considered one SKU, and an atomizer or tank is considered another. If the mod requires separate batteries, those are also considered an SKU, which requires FDA approval. Said batteries require a charger; that’s another SKU. If the mod and the atomizer come as a kit, that would yield yet another SKU. If the atomizer has three coil options of different resistances, that could require three separate PMTA applications. Clearly, this can spiral out of control quickly, so it’s expected that companies will need to streamline their product offerings.
Two parallel philosophies have been playing out over the past several years. One is to throw everything at the wall and see what sticks. Several companies have been releasing an overwhelming number of products in quick succession to try to get a better feel for what works and what does not. PMTAs are expensive, and many companies have adopted the “measure twice, cut once,” mentality. The past 10 years or so have allowed the industry to innovate, unimpeded by government regulation. This innovation naturally plateaued to a point where vapers have enjoyed a few years of refinement.
The technology seen today is not much different from the technology introduced three years ago. The difference is that today’s products have gone through a process of refinement due to the growing population of vapers providing feedback with both their voices and their wallets. It’s been a completely free market up until this point, and while manufacturers have been steadily improving their products, now is the time to lock in the best of the best and commit to the long term by submitting PMTA applications.
The other philosophy is to streamline the product offering, and this can be seen with the popularity of proprietary systems. For example, 510 devices have pretty much stagnated in popularity while pod systems have seen a boom. If a 510 device is compatible with a thousand 510 atomizers, and vice versa, that’s an impossible number of PMTAs, and without an example of a product that has undergone the process, it would be a huge gamble to try to sell the FDA on a device that is compatible with products outside the applicant’s ecosystem.
The prospect of a device such as a 510-compatible atomizer, which is ripe for facilitating the rise of black market mods, could invalidate the PMTA process on that prospect alone. Not only would the applicant be taking a larger risk by submitting a PMTA for a 510 device, but he would also be complicit in the assumed knowledge that he won’t see a return on that PMTA investment if the end user chooses to go outside said applicant’s ecosystem for complementary products. In short, manufacturer X isn’t going to shell out hundreds of thousands of dollars to submit a PMTA for a 510 mod if vaper Y is just going to turn around and buy an atomizer off the black market.
The most likely scenario is that each company is going to submit PMTAs for a line of products that keep the customer within their ecosystem. Whether that’s one type of product or several remains to be seen, but it only makes sense for any company to want to see the highest return on investment possible. Additionally, this is only the first round of PMTAs, and no product has made it successfully through the process.
It’s unlikely that any applicant has already submitted more than a few products for approval. Even with FDA guidance, the industry is figuratively a canary in a coal mine. Until there is a solid example of a product successfully navigating the PMTA process, companies are likely to be conservative in how many products are submitted for approval. Those that do will likely be product types that have proven to be the most profitable and simple.
Pod systems are the most likely products to have already been submitted, along with e-liquids. They’re the most popular products in today’s market and are the easiest to consolidate. There are many pod systems out there, perhaps too many, but for good reason. They appeal to the widest market and ensure that consumers remain within the ecosystem as they keep coming back for replacement coils and pods.
Pod systems are also the most resistant pieces of hardware when it comes to a black market, therefore mitigating any risk for a PMTA rejection based on that premise. Many companies have released multiple pod systems over the years and by now have a good idea of which designs are the best. In terms of hardware, expect to see a pod system as the first “FDA-approved” vapor product.
As for specific companies to keep an eye out for, look at the largest companies. Smok, Innokin, Vaporesso, Juul—these manufacturers have been preparing for the PMTA deadline for years and have already submitted applications. In fact, almost all the big names in the vapor industry have submitted applications, including Uwell, HorizonTech, Sigelei, Suorin and others. Currently no PMTA has been approved, but none have been rejected either. These companies have the most resources, motivation and resolve to see this process through to the end.
E-liquid, however, is a completely different animal. It takes much more to create vapor hardware than it does to create e-liquid, and that means that smaller companies have also been submitting PMTAs for e-liquid. Unfortunately, much more consolidation will likely also be occurring. Remember, if only one flavor is available in four nicotine strengths and three bottle sizes, that’s potentially 12 PMTAs for “one” e-liquid. So even though more e-liquid companies are submitting PMTAs than hardware manufacturers, each e-liquid manufacturer will likely have to consolidate much more than a hardware manufacturer. This is also heavily reliant on how the FDA receives the PMTA. Many e-liquid manufacturers have submitted one PMTA for multiple flavors, but the success of this method remains to be seen, and the FDA’s own language is ambiguous:
“A manufacturer could submit one premarket application for multiple tobacco products with a single, combined cover letter and table of contents for each product. However, when [the] FDA receives a premarket submission that covers multiple, distinct new tobacco products, we intend to consider information on each product as a separate, individual PMTA …. [The] FDA considers each ENDS product with a differing flavoring variant or nicotine strength to be a different product.
So will each different nicotine strength of each bottle size require a separate PMTA, or can they be combined? It’s unclear, but some manufacturers such as AMV Holdings are confident that multiple SKUs can be covered by a single PMTA successfully. In a Sept. 9 press release, AMV writes, “AMV has filed an additional 104 PMTA submissions accounting for over 5,000 SKUs.”
However, even if multiple SKUs can be approved by the FDA under a single PMTA, consolidation will still occur, and only the most popular flavors, strengths and sizes will be submitted, at least initially. Given the popularity of pod systems, many manufacturers will likely submit a PMTA for e-liquids that use nicotine salts for a high concentration of the stimulant. Non-nicotine e-liquid is also likely to be among the first wave of submissions as well as one that is medium-strength. The reason being is that if a vaper prefers a nicotine strength of 3 mg, then unofficially the user can mix a higher strength with the non-nicotine e-liquid to achieve the desired strength.
Several well-known e-liquid companies have submitted applications, including Humble Juice Co., Suicide Bunny, Charlie’s Chalk Dust and Beard Vape Co. While the more popular flavors may or may not have been submitted, there are several things that can be expected. First, tobacco and menthol flavors will likely be among the first flavors to receive approval, followed by basic fruit flavors.
Like with nicotine strengths, flavors can be mixed by the end user, and by keeping it simple, mixing becomes much easier. Strawberry mixed with banana is much easier than apple-peach-mango mixed with blueberry mint. Depending on how the FDA treats bottle sizes, those may be consolidated to one size as well. Thirty milliliters is far and away the most popular size bottle for e-liquid, so expect that to become the standard.
As the top level of the vapor industry consolidates its products, so too must the ground level. Doing so in a similar way to manufacturers is the most pragmatic approach. If and when products begin receiving FDA approval, look for three “levels” of products—beginner, intermediate and advanced—with minimal variation for each.
At first, all three levels may be pod systems with varying degrees of advanced features, such as variable wattage, temperature control, etc. Beginner devices like disposables and pod systems, such as the Caliburn G from Uwell (see “Building on Success,” page xx), should take priority because even if they are mostly targeted at new and beginning vapers, advanced users can find value in those products as well.
Intermediate-level products can begin to include features such as variable wattage and a larger battery capacity or e-liquid capacity. These are generally features that are requested by beginners who have had time to use a lower level product and find themselves wanting for more. Perhaps it’s more vapor or just not needing to charge the battery quite as much. Each customer base can vary, but those moving to intermediate devices want “more but better.”
Advanced products are much the same but with generally higher power capabilities, e-liquid capacities, etc. The advanced user will generally know what they are looking for. In the current state of the industry, advanced devices generally include rebuildable atomizers as well, but these are likely not going to be a priority outside of niche markets. There’s a good chance that the first products brought through the PMTA process will be on the simple side, and rebuildables could require a separate PMTA for each type of wire and wick in order to be usable.
The mods most commonly used with rebuildables also tend to have removable batteries, of which there are multiple brands that could, again, each require a PMTA submission. There are quite a few “moving parts,” so to speak, when it comes to advanced vapor devices, and until the industry has a more complete knowledge of how to submit a successful PMTA, the more complicated vapor products will likely be left by the wayside.
The most important thing going forward is to simplify, reduce redundant products and provide a clear advancement pathway for new users. There is massive value in being a one-stop shop for new customers to discover vaping and keep coming back as they progress at their own pace. This may prove much easier throughout the PMTA process as a store owner may very well to be able to pick one manufacturer and stick to it since currently, many products are already similar between companies. Consolidation may also serve to clarify and simplify the development of a product line within a store, making it easier for stores and customers alike.
The PMTA process is grueling and stressful for the entire industry. Although choices may soon become very limited, rest assured that the most reputable names in the business will continue to make their products available. Consolidation is inevitable, but one way or another the burden of choice is about to become much lighter, for better or for worse.
December 26, 2020
Change of the Guard

What might the new U.S. President’s administration have in store for the vapor industry?
By Patricia Kovacevic
At the time of writing, the results of the U.S. elections are still contested by the presidential incumbent, a Republican, via various vote recount requests and litigation; however, it is a virtual certainty that the U.S. will have a new president, representing the Democratic Party, as of Jan. 20, 2021.
The heads of departments, including the head of the Department of Health and Human Services (HHS), are appointed by the president, subject to confirmation by the Senate, and typically change with the administration. In turn, the Food and Drug Administration (FDA), which is the agency within the HHS with primary jurisdiction over tobacco products (including electronic nicotine-delivery systems, or ENDS) as well as drugs, foods and other products, will be led in the new administration by a new commissioner.
Given the Covid-19 crisis, the new president will be under immense pressure to appoint a new FDA commissioner immediately. Interestingly and somewhat surprisingly, a former FDA commissioner, David Kessler, was recently named co-chair of the new administration’s Covid-19 task force, although Kessler resigned his commissioner role in November 1996 amid controversy for overbilling his travel expenses during his tenure.
Also during Kessler’s tenure, the FDA attempted to regulate tobacco products as “delivery devices for the drug nicotine” to bring tobacco products under FDA jurisdiction. Tobacco companies challenged the rules all the way to the Supreme Court and won (FDA v. Brown and Williamson Tobacco Corp.). The Supreme Court ruled that “Congress has clearly precluded the FDA from asserting jurisdiction to regulate tobacco products. Such authority is inconsistent with the intent that Congress has expressed in the FDCA’s [Food, Drug and Cosmetic Act] overall regulatory scheme and in the tobacco-specific legislation that it has enacted subsequent to the FDCA. In light of this clear intent, the FDA’s assertion of jurisdiction is impermissible.”
Kessler’s wish to see tobacco regulated by the FDA was eventually granted by Congress in June 2009 through the bipartisan passage of the Family Smoking Prevention and Tobacco Control Act. While some speculate that Kessler may be on the short list for HHS commissioner, it is likely that the administration will bring forward new faces. Still, Kessler’s life-long anti-tobacco stance and past working relationship with the current head of the Center for Tobacco Products might give an indication of the increased scrutiny of the tobacco sector in the years to come.
Patricia Kovacevic
The ENDS industry status quo, from a legislation point of view, while far from ideal, is by now familiar to the ENDS industry. The recent premarket tobacco product application (PMTA) filing deadline has come and gone, and, as expected, we have not seen a flurry of warning letters post-September 2020 ordering certain vapor manufacturers to stop selling their products because they did not submit a PMTA.
The FDA is, however, expected to start enforcing this legislation sooner or later. For any dramatic change to occur, the governing legislation, the Food, Drug and Cosmetic Act, would have to be amended, which is not likely to be top of the list for the upcoming Congress given the priorities the new administration announced during the election campaign. Still, the House of Representatives, one of the chambers of the U.S. legislature, remains dominated by the Democrats, the same party whose representatives initiated several tobacco-related bills and called for confrontational hearings on vapor products. The most recent one, in February 2020, was relatively tame compared with the tone of the July 2019 Juul hearing and even with the June 2014 Senate hearing.
Senate races in Georgia will require runoff elections on Jan. 5, 2021. If Democrats gain both Senate seats in Georgia in January, there would be a 50-50 tie in the Senate, and the vice president would have the tie-breaking vote in case the Senate is deadlocked on a piece of legislation. When the House, Senate and White House are controlled by the same party, the chances of the current administration to pass laws in support of its agenda are greatly increased, though divisions exist within each party, and surprises always happen. Furthermore, 34 out of the 100 Senate seats are up for regular election in two years as well as all 435 House seats; these will be a trying two years for Americans in an economic crisis, and the public sentiment can swing in the other direction. Thus, the new president may have only two years, if even that long, to pass a flurry of laws, and there may be more urgent matters than revisiting the Tobacco Control Act, which, for better or for worse, has worked so far.
The FDA already has broad powers to expand requirements and restrictions involving ENDS products, including the authority to impose product standards through notice-and-comment rulemaking. Ingredient caps and bans are among the standards the FDA has the authority to promulgate via regulation.
The latest unified agenda of regulatory and deregulatory actions
As of spring 2020, active regulatory actions include four potential future regulatory actions by the FDA, rolled over from previous agendas, with no clear deadline for publication of a proposed rule:
Requirements for Tobacco Product Manufacturing Practice (colloquially referred to as “Good Manufacturing Practices”)
Tobacco Product Standard for Characterizing Flavors in Cigars (follow-up to the 2018 Advance Notice of Proposed Rulemaking); this is unlikely to move into the final rule stage on account of recent courtroom successes by the cigar industry.
Modified-risk tobacco product applications; this future proposed rule would establish content and format requirements to ensure that modified-risk tobacco product applications contain sufficient information for the FDA to determine whether it should permit the marketing of a modified-risk tobacco product. Additionally, the proposed rule would set forth the basic procedures for modified-risk tobacco product application review and require applicants receiving authorization to market a modified-risk tobacco product to establish and maintain records, conduct post-market surveillance and studies, and submit annual reports to the FDA.
Premarket tobacco product applications and recordkeeping requirements, a 2019 proposed rule, which would have as a next step at some point in the future, likely in 2020, a final rule.
Notably, ingredient bans and nicotine caps are not on the regulatory agenda. A first step toward an ingredient ban would likely be an Advance Notice of Proposed Rulemaking (ANPRM), although the FDA can in theory skip this step and move directly to a proposed rule, open a docket for comment, collect comments and consider whether it has sufficient information to finalize the rule. Given the complexity of the issue and the current research focusing on flavor ingredients in ENDS, if the FDA determines that an exploration of a flavor ban is desirable, the FDA will probably go through the ANPRM step.
One would have to wonder, though, why engage in rulemaking when the FDA already reviews all relevant information about every ENDS product on the U.S. market, present and future, through the PMTA process—thus allowing the agency to make a case-by-case determination—and the FDA will no doubt pay considerable attention to certain flavored products. In the author’s personal opinion, the PMTA process is the FDA’s preferred avenue to make decisions on individual products rather than issuing rules on product categories, which can also be challenged—and the current Supreme Court might entertain challenges to the FDA’s behavior if it came to it down the road.
Meanwhile, the majority of states by number still lean conservative, which likely means fewer developments in taxation, some scrutiny of ENDS but not necessary priority placed on shrinking the lawful ENDS market as there is no immediately quantifiable health benefit from doing so, and many potential harms. Of note are the California litigation and the potential referendum in California to overturn SB 793 (the flavor ban legislation). By the time this you read this article, we should know whether the bill opponents succeeded at collecting the necessary signatures to place the referendum on the November 2022 California elections ballot and suspend the application of the California flavor ban until then and pending the referendum’s outcome.
The question we must also ask, given the political, public health and economic crisis context is whether ENDS are a threat to anyone and why any administration would, at this juncture, prioritize overregulating a harm reduction asset over the important, systemic changes Americans expect from the administration and drastically mitigating the Covid impact. The industry is likely to consolidate and survive.
A global legal and compliance nicotine industry expert, Patricia I. Kovacevic has experience that includes general counsel and chief compliance officer roles at Nicopure Labs as well as leading senior legal and regulatory positions at Philip Morris International and Lorillard. Kovacevic served on the board of directors of the Vapor Technology Association and on the advisory board of the Global Tobacco & Nicotine Forum. She is the founder of RegulationStrategy, a global legal and compliance FDA-regulated industry consultancy.
December 23, 2020
Eyes on the Prize

Credit: Tumisu
While tobacco harm reduction products have an important role to play, quitting ‘cold turkey’ remains a legitimate strategy in pursuit of better health.
By George Gay
According to a joke included at the end of a London Review of Books piece by Jerry Fodor, a keynote speaker opens his remarks at a philosophical conference by saying that, in principle, there are 12 philosophical positions, only to be interrupted by a heckler shouting, “13!” The keynote speaker continues: “As I was saying, there are 12 philosophical positions …” but again the heckler shouts, “13!” The speaker then says that he will describe briefly the 12 philosophical positions. The first, he says, is Naive Realism, according to which things are more or less the way they seem to be. At that point, the heckler shouts, “Oh no, 14!”
You don’t have to be a philosopher to get the message that there is a danger that complexity can suffocate simplicity and the common-sense benefits that the latter has to offer. This isn’t to say there is no need for complexity—just that there is also a need, at times, for simplicity. As I believe Einstein once put it: Things should be made as simple as possible but no simpler.
Is there not a danger that in pursuing tobacco harm reduction (THR) we are losing sight of the simple? I know it’s unfashionable to ask, but what is wrong with smokers going cold turkey if they want to quit their habit? There was a time when all smokers who wanted to quit went cold turkey because that was the only route out of tobacco. And millions did it. I was one of them.
What a lot of readers will be thinking, however, is that there’s nothing stopping smokers from going cold turkey, so what’s the problem? Well it’s not quite true that there’s nothing stopping them doing so. I can think of at least two things that would be holding them back.
One is the fact that various people and organizations have taken a lot of trouble to convince smokers that quitting cold turkey is incredibly difficult, if not impossible. They have tried and largely succeeded in convincing many smokers that they are victims who cannot control their own destiny. Their ability to make decisions about smoking and health has been taken from them by tobacco manufacturers. This, of course, is nonsense, but it is a useful narrative for some people to spread and, regrettably, for others not to counter.
The other reason is that smokers are given too little help to quit cold turkey. Why couldn’t a large part of THR comprise tobacco tax-funded public announcements encouraging smokers to quit? Of course, there would be a need firstly to sound a very loud warning bell.
Such announcements should not descend into the type of propaganda beloved of certain governments and organizations where smokers are depicted as being victims of the tobacco industry, patients of the medical profession and the scourge of society. And such announcements should not feed smokers a bunch of lies and half-truths, try to frighten the pants off them and generally treat them as though they were children without the ability to make rational decisions.
Better still, smokers should be provided with positive rather than negative information. They should be told how quickly, post-quitting, their risk of contracting certain diseases and conditions falls to that of, or near to that of, nonsmokers. And they should be told how, in quitting smoking, and especially in quitting cold turkey, they will be saving money while making a positive contribution to helping prevent pollution and the further degradation of the environment.
One of the problems is that THR has become monetized—become part of the destructive system under which the worth of everything is judged by its performance on the “market.” We have been fooled into believing that what matters is that smoking is replaced by something that can be sold, preferably for the same sorts of profits that are currently enjoyed in selling cigarettes. That is, cigarettes have to be replaced by less risky tobacco and nicotine products, including nicotine-replacement therapy products manufactured by the pharmaceutical industry.
And it is true that there would be something to be said for such a way of looking at smoking cessation if it weren’t for the fact that less-risky products seem to be struggling—entangled in endless debates based on science and pseudo-science, conspiracy theories, political shenanigans and great dollops of bureaucracy.
These debates are all very interesting and take up hours of conference time, but they remain largely unresolved, like Fodor’s philosophical positions two through 12, and they simply leave smokers up a creek without a paddle. The interests of the smoker seem to have been pushed into the background as the various sides in the THR debate defend their own positions and brief against each other.
That something is seriously wrong with efforts being made to promote smoking cessation is clear from Burning Issues: Global State of Tobacco Harm Reduction 2020, the second (the first appeared in 2018) such report written by Harry Shapiro and published by Knowledge-Action-Change. This 162-page report makes the point that after more than a decade of product availability, there are only nine users of “safer nicotine products” (SNP—vapor devices and heated-tobacco devices, Swedish style snus and some other safer forms of smokeless tobacco) for every 100 smokers.
This should sound alarm bells, and it does, but those bells are peeling out the wrong message as far as I can hear. They are calling for more of the same. How does it go? Having lost sight of our objectives, we redoubled our efforts.
I should add, however, that this is an excellent report with masses of information about where we are with THR and the SNPs that underpin it and how we got here. The way forward is less clear because it is difficult to navigate a path in the face of the guerrilla activities employed by those opposed to the THR approach—activities that have so far proved fatally successful in casting doubts in the minds of smokers and vapers. Nevertheless, the report contains 15 recommendations (as well as 20 conclusions) that map out a route to the future. Though, in the light of the short history of THR, some of those recommendations might better be described as wishful thinking.
One of the things that becomes clear in the report is how little success had been achieved in pushing the quit-smoking agenda before the incorporation of the sorts of harm reduction principles that had already been well established in respect of other health challenges. And little wonder given that pre-THR, the approach had been to bully smokers into quitting. THR takes an altogether more humane approach, as the report spells out:
“Harm reduction refers to a range of pragmatic policies, regulations and actions, which either reduce health risks by providing safer forms of products or substances, or encourage less risky behaviors. Harm reduction does not focus primarily on the eradication of products or behaviors.”
Contrast this with the methods employed before THR and that are still pushed by many governments, organizations and individuals—methods that are based on discouragement or punishment. Such methods include the degradation of the products that smokers enjoy through pointless controls on nicotine levels, the banning of harmless flavors and the despoiling of packaging. They include the inexcusable use of smoker “denormalization” or officially sanctioned discrimination. And they include the imposition of grossly unfair levels of taxation.
Credit : Omni Matryx
Meanwhile, there are issues brought up in the report that I believe could usefully be subjected to further analysis in any forthcoming edition of Burning Issues. The report mentions that the World Health Organization (WHO) has “not revised downwards its estimate that one billion lives could be lost to smoking-related disease by the end of the century.”
Despite the fact that many of us are highly critical of the WHO’s attempts at encouraging smoking cessation, we tend to accept its figures unquestioningly. But whereas, for instance, a figure of one billion is convenient to throw about, when you think about it, it is ludicrously rounded. And given that this is a worldwide figure, you have to ask yourself how the data are gathered in many countries, especially in those where, perhaps because of wars, there are no fully functioning administrations.
And it would be good to see some of the methodologies used in compiling such figures. Since, I guess, some people die of “tobacco-related diseases” that might also be seen as “pollution-related diseases,” how are these deaths divided up? I suspect that the default setting is to put such deaths into the tobacco-related deaths column, in which case the WHO’s tobacco-related deaths figures are likely to be inflated.
This is not an attempt to get tobacco partly off the hook but to make sure that we are taking action where action is required and not just where some people would like to see it applied. There is no point in developing vapor devices if the disease problem is down to the pollution caused by air travel, etc.
But what I would like to see, especially, is detailed information on how “tobacco-related” diseases and deaths have fallen with the reduction in smoking in those countries where such smoking reductions have occurred. In countries such as the U.K., smoking has been falling long enough for the related diseases to be also showing declines, and there should be a recognizable correspondence between the two.
Credit: Kjerstin Michaela Haraldsen
The problem with accepting blind what the WHO has to say is that one can end up being mesmerized by huge figures and drawing some questionable conclusions. The report states, for instance, that the one billion tobacco-related deaths “[are] equivalent to the combined populations of Indonesia, Brazil, Nigeria, Bangladesh and the Philippines dying from Covid-19.” I know that it is considered rather trite to say so, but shit happens, people die, and it is necessary to keep a sense of proportion.
If you look at a long enough time frame, you could probably say that the equivalent of the population of Belgium will die from having pieces of toffee stuck in their windpipes. And I think the reference to Covid-19 doesn’t stack up.
There is a world of difference between smoking and Covid-19. A lot of people won’t agree with me here, but people have a choice about whether or not they smoke. But the ordinary person in the street has next to no control over the rise and spread of viruses. That is why, to my way of thinking, viruses are a valid area of interest for the WHO whereas smoking is not.
I’m not saying that we should row back from THR products, but, at the same time as we are improving these products and making them available, we should be putting our foot down harder on the cold turkey pedal just in case those opposed to THR win the day. It’s not just me being pessimistic. This is from the report.
As the environment for THR has grown ever more toxic since our last report, we have turned our attention this time to the mechanisms of the well-orchestrated and well-funded global campaigning driving an increasingly prohibitionist response to SNP.
Despite the above, it is claimed in the report that SNPs have been “disruptive” and that they have provided one of the most startling public health success stories of modern times, claims that, given the slow conversion rate from smoking to using SNPs, seem not to be supported by the evidence. Or perhaps I’m looking at things from the wrong direction. This, too, is from the report:
“Globally, the value of the vaping market has continued to grow since our 2018 report and is projected to grow further. The chart from Statista43 shows the value of the e-cigarette market at around $19 billion and its steady projected growth from 2012 through to 2023.”
I see. So it is about monetization, is it? OK, we have to be practical. We have to allow companies to make money, but there’s clearly a problem here. Declines in smoking predated the arrival of SNPs in many of the countries where these sorts of products are affordable, basically the West, but smoking is still on the increase in many low-income and middle-income countries where they are less affordable. If we are not careful, THR will become a system that helps to underpin health inequalities. If you’re rich, you can afford the products to keep you healthy; if you are not … well, too bad.
By all means, let’s redouble our efforts, but let’s make sure we’re still focused on the goal of encouraging people to stop smoking. We might need to look for new ways of doing this or even old ways, such as cold turkey.
December 22, 2020
Restrictive Sales

The regulatory wave is crashing down on internet ENDS retailers.
By Nicholas A. Ramos, Agustin E. Rodriguez and Bryan M. Haynes
Online businesses selling electronic nicotine delivery systems (ENDS) to consumers must contend with a “patchwork quilt” of state laws. This patchwork of laws creates significant regulatory uncertainty and risk for businesses selling online in this space. There are many legal issues facing online retailers, like bans or restrictions on “flavored” tobacco products, minimum age and age-verification requirements, and state and local licensing and tax requirements. This article discusses some of the key legal issues associated with selling ENDS to consumers online and highlights proposed state legislation that may impose more requirements on the industry.
State licensing
Online retailers looking to comply with the myriad of state laws should first look at the states in which consumers purchase their products and, for each state, identify potentially applicable licensing laws. States may require licensing or registration under tax laws, health and welfare laws, and/or general business laws before online retailers may sell to consumers in their states. Idaho, for example, requires licenses from its Department of Health and Welfare to prevent youth access to tobacco products and electronic smoking devices. Washington, D.C., however, requires a basic business license from its Department of Consumer and Regulatory Affairs.
In addition, online retailers of ENDS should determine whether state licensing law definitions actually cover their products. While states have required licenses for the sale of tobacco products for years, they have only recently added definitions of ENDS to their licensing statutes. ENDS may be covered under licensing laws either because the category is explicitly defined, or the definition of tobacco products is broad enough to cover ENDS products.
Nicholas A. Ramos
Online retailers should also determine whether state licensing laws actually cover remote sales. Some states only require licenses for retailers that have a “place of business” or “business location” in their states. Hawaii, for example, is unique in that it requires ENDS retailers to obtain a registration from the Hawaii Attorney General. At this time, however, the Attorney General only requires retailers to register if they are located in the State, which excludes out-of-state online retailers.
It is also important to keep in mind that most state laws regulating ENDS were only passed within the last 3-5 years. Many of those new laws simply amended existing tobacco product laws, and legislatures may not have carefully incorporated those changes in all of the critical statutory sections. Consequently, there are often situations in which the legal requirements are not clear. In those cases, it may be prudent to reach out to regulators to better understand how they interpret their statutes.
State taxes
When online retailers face ambiguous licensing laws, it may be helpful to look to the purpose of those laws. For example, if licenses are required by a tax department, the online retailer should look at the tax statute to determine who and what is subject to taxes. Many states require licenses to facilitate payment of sales or excise taxes.
Almost all states impose sales and use taxes on remote sales of products. For out-of-state online retailers, most states follow the analysis outlined in South Dakota v. Wayfair, Inc., 138 S. Ct. 2080 (2018), which generally permits a state to impose sales tax on an out-of-state seller where the seller has a “substantial nexus with the taxing State.” Some states require a business or tax registration to file returns and pay sales taxes.
Missouri, for example, does not tax or regulate ENDS as tobacco products, but it requires online retailers to obtain a retail sales tax license for sales tax purposes. Furthermore, states typically only require sales taxes from remote sellers when a certain sales volume or revenue threshold has been met. Virginia, for example, requires a remote seller to register for the collection of sales and use tax if it received more than $100,000 in gross revenue from sales in Virginia or engaged in 200 or more separate retail sales transactions during the previous or current calendar year.
In addition, like state licensing laws, the applicability of excise taxes to ENDS products sold online can depend on the specific product definitions in the relevant statutes. Some states’ excise tax statutes explicitly define and include ENDS products, while others attempt to fit those definitions into terms like “tobacco products” or “other tobacco products.” Utah, for example, explicitly taxes “electronic cigarette substances,” “prefilled electronic cigarettes,” “alternative nicotine products,” “nontherapeutic nicotine device substances,” and “prefilled nontherapeutic nicotine devices” in its Electronic Cigarette and Nicotine Product Licensing and Taxation Act.
Agustin E. Rodriguez
Some states explicitly exclude ENDS from definitions that would subject them to excise taxes. Texas, for example, provides defines taxable “tobacco products” to exclude e-cigarettes, or any other device that simulates smoking using a mechanical heating element, battery, or electronic circuit to deliver nicotine or other substances through inhalation.
It is also important to keep in mind that states tax various parts of ENDS products in different ways. Virginia, for example, imposes an excise tax on liquid nicotine products at the rate of $0.066 per milliliter of liquid nicotine, but the State does not impose taxes on other components of ENDS. Washington, D.C., on the other hand, taxes vapor products by making the tax rate equal to the cigarette tax, expressed as a percentage of the average wholesale price of a pack of 20 cigarettes.
Finally, if online retailers determine state excise tax laws apply to their ENDS products, they must still determine who is required to pay those taxes and when they are due. For example, some states, like Kentucky, require that excise taxes be paid by the licensed distributor that first possesses the ENDS products for sale to a retailer or unlicensed person in the State.
Potential penalties & enforcement climates
Online retailers facing ambiguous licensing statutes should consider two major factors in their risk analysis—statutory penalty provisions and enforcement climate.
Penalties for operating without a license can be steep. In Idaho, for example, it is a criminal offense to sell ENDS without a permit issued by the Department of Health and Welfare. In addition, a court may impose a fine of $1,000 per day beginning the day following the date of citation as long as the illegal ENDS sales continue. In other states, however, penalties are relatively low. In Montana, for example, failure to obtain a vapor product license is punishable by a civil penalty of $100.
Finally, online retailers should consider the enforcement climate surrounding regulation of ENDS products in certain states. For example, Attorneys General in various states have filed lawsuits against an ENDS manufacturers and online retailers. Although these cases do not directly implicate licensing or tax issues, enforcement actions by Attorneys General may suggest a more aggressive enforcement climate when it comes to licensing or tax violations.
Proposed state legislation
Online retailers should expect upcoming state legislative sessions to be fairly active with regard to regulation of ENDS products. In Colorado, for example, there is no current nicotine products or ENDS tax or licensing scheme. But Colorado HB20-1472 established a voter referendum on whether there should be a tax on “nicotine products,” which would include “products that contain nicotine and that are ingested into the body.”
Bryan M. Haynes
In Georgia, the legislature is considering a bill that will amend its tax and revenue laws “to provide for excise taxes to be levied on certain alternative nicotine products and vapor products” and to “require licensure of importers, manufacturers, distributors, and dealers of alternative nicotine products or vapor products.” HB 1229.
South Carolina is also considering a bill (H.4714) that will “provide for the levying, assessment, collection, and payment of certain taxes on vapor products.”
These are just a few examples of states that are considering ways to regulate and tax ENDS products. Therefore, it is important for online retailers to incorporate accurate state legislative tracking into their compliance strategies.
Conclusion
As with any other new technology, the law is often playing catch up with new business models and products, like the online sale of ENDS products. But given the issues discussed above, online retailers should prioritize compliance with varying state laws to reduce the risks of enforcement action.
Nicholas A. Ramos is an associate with Troutman Pepper. His practical advice enables clients to navigate regulatory compliance and licensing issues, complex investigations, and high stakes enforcement actions that arise under state and federal law.
Agustin E. Rodriguez serves as counsel for Troutman Pepper and has almost two decades of experience counseling tobacco companies in-house and in private practice on tobacco product regulation, taxation and multi-jurisdictional state and local enforcement issues.
Bryan M. Haynes is a partner with Troutman Pepper who specializes in tobacco industry regulatory compliance and enforcement matters. He efficiently assists clients in complying with regulatory obligations and managing risk, consistent with clients’ business objectives.
October 22, 2020
Disruptive Science

Credit: TTI
A new version of synthetic nicotine eliminates the cancer-causing impurities in leaf-derived nicotine.
By Timothy S. Donahue
No tobacco-specific nitrosamines (TSNAs). A new synthetic nicotine coming to market has none of the possible cancer-causing impurities that are found in traditional leaf-derived nicotine. In November, eLiquiTech, a wholly owned subsidiary of Tobacco Technology Inc. (TTI), will release its newly patented SyNic synthetic (S)-nicotine. The announcement has the potential to revolutionize next-generation tobacco products, such as electronic nicotine-delivery systems (ENDS), oral nicotine-delivery systems and heat-not-burn (HnB) products.
SyNic USP/EP, SyNic nicotine bitartrate and SyNic polacrilex resin are manufactured in U.S. Food and Drug Administration (FDA)-registered facilities using current good manufacturing practices (cGMP). These products have confirmed purity levels of more than 99.9 percent, (S) levels of more than 99.7 percent and are free of TSNAs and carcinogens, according to eLiquiTech CEO George Cassels-Smith. “What is the value of noncarcinogenic nicotine base to any tobacco product manufacturer?” he asks. “What is a noncarcinogenic tobacco product portfolio worth to the tobacco consuming public? But high-purity, pedigreed natural nicotine will continue to have a large seat at the table nevertheless.”
SyNic got its start seven years ago when e-LiquiTech began working with U.K.-based Zanoprima Lifesciences with the goal of developing a unique and patented portfolio of synthetic nicotine products. The group wanted those products to cover the entire nicotine value chain with a focus on next-generation tobacco products.
E-LiquiTech, through TTI, is committed to Zanoprima to serve as SyNic’s global distributor and the manufacturer of record for synthetic nicotine bitartrate and synthetic nicotine polacrilex resin as well as proprietary SyNic e-liquid formulas. “Ensuring that synthetic nicotine is readily available is the right thing to do for our industry—and now also is the right time to do it,” said Cassels-Smith.
Zanoprima holds the patent and eLiquiTech maintains the exclusive rights for global distribution to the tobacco and ENDS industries, but the product won’t be available to everyone, according to Cassels-Smith.
“This will not be available directly to the consumer market. We will soon post a set of standards online that manufacturers must meet to purchase our synthetic nicotine,” he says. “This product is not intended to circumvent the rules governing the tobacco and ENDS industries nor evade regulation. We will not sell it to companies that have that intent.”
SyNic will refrain from entering the highly contentious U.S. vapor market until its potential customers can show they have an accepted for review premarket tobacco product application (PMTA) submitted to the FDA’s Center for Tobacco Products. “Our objective is to work with the FDA, not around it,” says Cassels-Smith.
When synthetic nicotine first appeared on the market in 2016, the product was marketed as being a potential way to circumvent the FDA’s proposed deeming rule for next-generation tobacco products. The FDA’s definition of “tobacco product” includes any product made or derived from tobacco, including any component, part or accessory of a tobacco product. E-liquids that do not contain nicotine or other substances made or derived from tobacco may still be components or parts and, therefore, subject to the FDA’s tobacco control authorities.
Cassels-Smith says that Zanoprima has filed multiple global patents for its technologies and has also begun the process of filing drug master files with the FDA for SyNic nicotine, SyNic bitartrate and SyNic polacrilex resin. “Coupled with e-LiquiTech’s exclusive distribution, competitive pricing and carrying the e-LiquiTech guarantee, these products will be available only to responsible partners operating within the regulatory guidelines of the global tobacco industry,” said Cassels- Smith. “The synthetic nicotine is cleaner than naturally derived nicotine because it has no TSNAs. These nitrosamines have the potential to turn into carcinogens. SyNic will not have any nitrosamines and is 100 percent carcinogenic-free by design.”
E-LiquiTech’s synthetic nicotine resembles its naturally derived cousin. Like a naturally derived liquid nicotine, e-LiquiTech’s new synthetic nicotine is more than 99 percent pure (S)-nicotine. This purity of (S)-nicotine has a better effect on the body, and SyNic carries fewer impurities than naturally derived nicotine that comes from leaf tobacco.
“Nicotine exists in nature in two forms, (R) isomer and (S) isomer. One is basically a mirror image of the other, but the nicotine desired by vapers and smokers alike is the (S)-nicotine alone. Naturally grown tobacco contains over 99 percent (S)-nicotine, and the rest is very little (R),” says Cassels-Smith. “The body considers (R)-nicotine a filler with substantially less physiological effect. It’s considered a waste product, and [the body] does not absorb it. SyNic is slightly superior to the (S)-nicotine content found in a naturally derived nicotine because of its higher levels of (S)-nicotine with qualified and quantified impurities.”
Traditionally, a problem for the producers of synthetic nicotine has been that the entire production process is both complicated and expensive. As a chiral molecule, nicotine is far easier to produce as a synthetic nicotine with equal amounts of both (R) isomers and (S) isomers compared to a nearly pure (S)-nicotine. “(R)-[nicotine]/(S)-nicotine requires additional refining processes, which [are] time consuming and expensive to convert it to a true synthetic (S)-nicotine,” explains Cassels-Smith. “Also, because (R)-nicotine has substantially [fewer] physiological properties, it takes twice as much 50/50 synthetic nicotine in an e-liquid to achieve parity with SyNic. Because SyNic has greater than 99.7 percent (S), it only needs half the amount of SyNic to create the same effect for users as current synthetic nicotine offerings on the market.”
Naturally derived nicotine and synthetic nicotine are identical on a molecular level. The differences are the individual or potential impurities. Nicotine derived from tobacco can contain potentially harmful impurities if it is not purified sufficiently. That can be very difficult and costly because the impurities appear structurally very similar to the nicotine molecule itself. But synthetic nicotine is virtually free of any impurities from the beginning and none are carcinogenic.
SyNic, by design, carries no heavy metals and contains no residual pesticides. Additionally, unlike tobacco-derived nicotine that uses harsh acids and chemical solvents in its process, SyNic, is produced using a “green chemistry” method. “Its manufacturing is environmentally friendly, and any solvent used is recovered completely before being recycled for future use,” explains Cassels-Smith. “The SyNic process makes the tobacco-derived nicotine process appear dirty by comparison.”
SyNic will help manufacturers meet the FDA’s goals by consistently creating high-quality nicotine to deliver to the consumer without the possibility of potential carcinogens, according to Cassels-Smith. “We will allow vaping products to have the cleanest delivery and the best delivery,” he says. “That isn’t going to happen with the old technology. SyNic is a new frontier and a perfect tool for this industry to reinvent itself. It is constantly developing and reinventing itself. This product can help make all tobacco products better.”
Because of its unique patented process, Cassels-Smith says SyNic can achieve price parity with tobacco-derived nicotine. He adds, however, that this synthetic product will always be marketed at a higher cost than naturally derived nicotine to ensure there will always remain a naturally derived pedigreed nicotine market where the tobacco farmer can sell his crops.
“We have a lot of respect for the natural product and foresee our synthetic nicotine being a compliment to those that wish to remain all natural. There is enough room in the market for everybody. SyNic, with its known qualities, will have a place at the table alongside pedigreed natural tobacco-derived nicotine. But there are issues with nicotine sourced from scrap and dust as traceability is impossible and controlling pesticide and heavy metal contamination is problematic,” Cassels-Smith explains. “I foresee a future requiring the tracing of [natural] nicotine’s origin from the seed and soil through the extraction process and also quantifying impurities, all in cGMP facilities.”
SyNic’s potential is unlimited in the number of products in which it could be used. Cassels-Smith says that he cannot think of a single nicotine product that could not benefit from SyNic. In a heat-not-burn product, for example, during the rod-making process, SyNic could augment the prevalent nicotine source—or even be the sole source.
“Zanoprima has adapted their SyNic technology and patented an extremely unique and stable nicotine salt that does not use organic acids and retains pH stability,” he says. “SyNic also has the potential for being associated with superior purity and shelf life stability in all tobacco products of the future. SyNic will raise the bar, and we are just scratching the surface. It is a great tool that emerges at the perfect time for every tobacco product designer. The portfolio of potential products that can utilize SyNic is infinite.”
October 12, 2020
An Avalanche of Paper

Gerri and James Jarvis
The ‘Davids’ of the vapor industry prepare for war.
By Maria Verven
In many ways, Gerri and James Jarvis are the epitome of the Davids who are up against the Goliaths of the vapor industry.
Now that the U.S. Food and Drug Administration’s (FDA) premarket tobacco product application (PMTA) deadline of Sept. 9 has come and gone, the wait is on to see which products—and which Davids—will survive.
The PMTA battle plan
Gerri and James own Jarvis Vaping Supply, a wholesale vaping supply store, as well as four retail stores called Vapor Station in and around Columbus, Ohio. James is also president of the Ohio Vapor Trade Association, and both Gerri and James are avid advocates of the vapor industry.
The Jarvis’ first got into the industry after watching the growth of Westside Vapor, which was started by their friend, Jason Gang.
“My passion for the industry came from the loss of my grandmother when I was 16 due to smoking-related issues,” James said. “I saw how successful vapor was for Jason in his goal of quitting smoking. It really made me want to help others do the same thing.”
The Jarvis’ business was going gangbusters until media reports of e-cigarette or vaping product use-associated lung injury (EVALI). Now known to have been caused by the addition of vitamin E acetate, a product that isn’t used in any store-bought e-liquids, EVALI scared many customers away from vaping.
Vapor Station experienced a devastating 50 percent loss in sales from EVALI reports, and then Covid-19 hit, causing another major loss as stores had to close during the early months of the pandemic. “Unfortunately, during the pandemic, several people went back to smoking since cigarettes were so easy to get,” James said.
While James continued to run the business, Gerri worked day and night over six months to fill out PMTAs for 998 products (SKUs). In the end, she dumped roughly 3 million pages off at the FDA.
With just the help of a Facebook group called PMTA Sharing, Gerri was able to climb the PMTA mountain without any help from firms experienced in submitting PMTAs. The Jarvis’ were among 1,600 vapor company representatives who joined this and other private groups to help them navigate the PMTA process.
“With Covid-19 hitting right in the thick of the PMTA process, money was so tight that we needed to be careful with spending. Thanks to the help of the Facebook group, we were confident that we could turn something in to the FDA,” Gerri said.
But that wasn’t enough. She then went on to help her friend Jason Gang of Westside Vapor as well as several other small companies negotiate the PMTA process, including Dripology, Vapor Generation, KL Labs and E Cig Cafe. Gerri said Westside Vapor’s PMTAs for its 1,800 products totaled over 6 million pages.
The waiting game begins
Now the wait begins. Encouraged by the successful FDA acceptance achieved by business colleagues at ECIG Charleston and Bad Drip, the Jarvis’ have high hopes for their PMTAs. All had used processes shared in the PMTA Sharing Facebook group.
They are also realistic, knowing that the FDA has received a flood of applications. The Jarvis’ are one of many e-liquid manufacturers and small vape shops that make their own e-liquids in dozens, if not hundreds, of flavors and in a variety of nicotine strengths and volumes. And each of these distinct products in every flavor and nicotine strength requires a separate PMTA.
The FDA publicly acknowledged that the market for vapor products is extremely large—“several orders of magnitude greater than anything the agency has experienced … The likelihood of [the] FDA reviewing all of these applications during the one-year review period is low.”
We asked Gerri to give us a glimpse inside the process of pulling together PMTAs for nearly 1,000 products. Here’s what she shared with Vapor Voice:
When did you start pulling together all the information you needed to complete the PMTAs?
As an industry, we’ve been working on this since August 2016, but we started really getting the paperwork together in March of 2020. I guess it took deadlines from the FDA to really hit us to get to the point of pulling together the PMTAs.
We currently offer 998 SKUs, or products. We provided information on and requested PMTA approval on every one of our products.
Please tell me all about the PMTA process: How long did it take? What sort of information did you provide?
I started working in March 2020 and worked pretty close to nonstop from July to September. The Facebook PMTA Sharing group helped me run the studies and programs to gather the needed data, such as underage studies, customer surveys and PMTA review literature.
In our customer survey of around 5,000 customers, we learned that 90 percent used flavors—and most preferred the fruit flavors. If those flavors go away, the majority—76 percent—said they would go to the black market or back to smoking. We have the weirdest industry in the world: Our business model is to get people to switch to vaping from smoking and then reduce their level of nicotine and eventually [get] off of vaping all together.
Why did you decide to do it on your own? How confident did you feel about the process?
With Covid-19 hitting right in the thick of the PMTA process, money was so tight that we needed to be careful with spending. Thanks to the help of the Facebook group, we were confident that we could do the initial submissions ourselves.
Please share what you can about the expense of pulling together the PMTAs.
For the preliminary review, we had to pay for programs such as the Environmental Assessment Generator and Cover Letter Generator and other environmental assessments. If the FDA accepts our initial applications, we will then move into the substantial review phase for the product testing analysis and safety information. The FDA has only accredited six labs, and the expenses are exorbitant: Each SKU could cost us anywhere from $84,000 to $480,000, depending on which lab we use.
That’s why we’re working to try to get some kind of reform through Congress by reaching out to our senators and congressional leaders and explaining that these costs will kill small businesses—all but about 5 percent of the industry. The costs are blowing their minds. If we can pass some type of reform, there are labs right here in Ohio that can do the testing for a whole lot less.
Please share your emotions during this process: Were you ever frustrated? Were you worried about what should or should not be included? Were you worried it might not pass or pay off in the long run?
During all the hours we were putting together the PMTA, there was always that thought in the back of our minds that all this work could be for naught. We had no clue if what we were putting together was going to be enough to get us to the next level of the process or not.
We were very stressed with all the work on the PMTAs while also running the day-to-day operation of our shops. We had very late nights when our systems stopped working and the generators were running slow. And to top it off, the FDA brought out a new system just nine days before the submission deadline.
What’s the status of your PMTA?
We are still waiting on the news. We know people who used the same process who were accepted, which gives us hope for our PMTAs. We were told we might have to wait up to 180 days to hear back from the FDA. There is no real timeframe established. We just have to sit and wait for the FDA to contact us. But we are encouraged by the fact that three or four companies in the PMTA sharing group have received acceptance letters.
I understand you’ve helped other companies navigate the PMTA process.
I helped our friend Jason Gang pull together the files to run the programs for the cover letters, description sheets and environmental assessments. I would stay up for hours making sure the files were correct.
And I completely fixed one company’s FURLS (files with product information that must be submitted to the FDA) so they could complete the filing. We spent hours on the phone and Facebook Live, helping walk them through the process.
What are your takeaways? What would you do the same? What would you do differently?
I learned that a lot of the process is repetitive. I would spend the same time helping others get to the finish goal. I would have started earlier and kept better records, such as more proof of the dates [that] our products went on the market.
How is business going now? Do you have any predictions for the future of your business?
Business online and at our vape shops has been terribly slow with Covid-19. We are hopeful that with all of our teamwork, this community of small independent businesses will grow stronger.
We need everyone to see the unrealistic, onerous and prohibitively expensive process we were thrust into and how hard we are working to save our technology for consumers, our employees and our businesses.
The original “Vaping Vamp,” Maria Verven owns Verve Communications, a PR and marketing firm specializing in the vapor industry.
October 12, 2020
States of Confusion

Following the PMTA deadline, vape shops are unsure what vapor products are legal to sell in the U.S.
By Timothy S. Donahue
On Sept. 10, vape shop owners in the United States faced a dilemma. Numerous hardware and e-liquid manufacturers in the electronic nicotine-delivery system (ENDS) industry were required to pull their products from store shelves. Any product for which the manufacturer failed to file a premarket tobacco product application (PMTA) to the U.S. Food and Drug Administration (FDA) by Sept. 9 is now illegal to market in the U.S.
Tim Scarborough, general manager for Tennessee Vapor Factory, with several stores in Tennessee, said that after talking with distributors, he removed thousands of dollars in product from his store shelves. “It was a straight-up loss. We estimate it to be probably upwards of $10,000,” he said. “We haven’t gotten final figures, but it was [a] large sum.”
As for ordering new products, Scarborough says that many manufacturers and distributors have lists of products for which they have filed PMTAs. Those are the products Scarborough’s shop is trying to keep in stock. “It’s getting harder. We are having to do research to figure out if some of these products filed as well,” he says. “The selection, variety of product, is really minimal right now. We don’t even know for sure the FDA is going to approve a product. I think that, in the long run, this will push people back toward cigarettes.”
During the Global Tobacco & Nicotine Forum (GTNF) held virtually in September, a representative of a large vapor industry distributor told Vapor Voice that his retailers had no way of knowing exactly what products are legal, so they have been selling off the product currently on shelves but have been weary of ordering new product. The distributor did not want to be named due to fears of potential FDA reprisal.
“I’ve had retailers call and say they have lost 50 percent of their juice wall because of the companies they know didn’t file PMTAs. Shop owners have been asking for a letter of acceptance and maybe even a list with all the SKUs for the files we have submitted,” he said. “Retailers don’t want to incur fines for selling illegal products, but how can we even as a distributor know if a company has filed a PMTA? How many products have even been filed? I saw something the other day where the FDA was expecting 2 million PMTAs. A vape shop in Texas had 333 submissions. Beard e-liquids had 72. We submitted 105, but its more than that if you break it down into the different flavors and nicotine strengths. If we broke down our submission like that, it’s about 7,000 PMTAs. It’s really hard to know what exactly the FDA is doing.”
Many manufacturers and retailers have closed their businesses due to the cost of submitting a PMTA and the uncertainty surrounding the industry. NicVape, BlueDot Vapor and Stash E-liquids did not submit PMTAs, for example. A note on Illinois-based e-liquid manufacturer Level Up Vapor’s website reads only, “Closed; We are no longer accepting orders.” In a letter to its customers, VapeWild, explained it would not be submitting PMTAs and was shutting down. The company had been in business for six years and was a favorite of vapers worldwide.
“The PMTA deadline is finally upon us … It’s been a long road, and we did our best, but in the end, we just aren’t able to pull it off,” VapeWild wrote. “These are crazy times we’re living in, and they just keep getting crazier,” the letter states. “Our sincerest hope, though, is that we have somehow made a difference in the world for the better.”
Only a small number of the thousands of vapor companies in the U.S. have announced that they filed PMTAs by the deadline. Complicating matters, most of those companies have not released what devices or e-liquid flavors they have filed. So far, based on Reddit posts, press releases and media reports, just over 100 companies stated they have filed a PMTA or had the intent to file before the deadline. Just over 50 companies announced they had filed an application before the deadline. Even fewer revealed that the PMTA had been accepted by the regulatory agency. All the major tobacco companies in the U.S. have a PMTA currently accepted, filed and under review for a vapor product.
Credit: Smoque Vapor
Once an application is sent to the FDA, manufacturers are permitted to sell their products for a year unless the agency acts. So far, Philip Morris’ heated-tobacco device IQOS and Swedish Match’s General snus are the only two tobacco brands to have survived the PMTA process.
And the process does not end with marketing authorization. After receiving a PMTA, a company must continue to conduct postmarket surveillance and studies to determine the impact the orders have on consumer perception, behavior and health and to enable the FDA to review the accuracy of the determinations upon which the orders were based. These postmarket requirements also include a rigorous toxicity study using computer models to help predict potential adverse effects in users, according to the FDA. The orders also require the company to monitor youth awareness and use of the products to help ensure that the marketing of the products does not have unintended consequences for youth use.
In July, the director of the FDA’s Center for Tobacco Products, Mitch Zeller, said the agency would prioritize policing vapor products aimed at youth. However, the Covid-19 pandemic has put vape shop inspections on hold, according to Zeller, adding that no date has been announced for when in-person inspections would begin again.
“All the entities that we have contracts with have state level for activities like compliance checks and vape shop inspections,” Zeller said in July. “With that stop-work order, we’ve temporarily postponed all in-person inspections of tobacco retail establishments, but we continue to do all of our monitoring and surveillance and websites and publications and social media because we can do that remotely and have always done that, if you will, remotely from offices.”
Speaking at the virtual GTNF in September, Alex Clark, CEO of the Consumer Advocates for Smoke-Free Alternatives Association (CASAA), said there is a lot of uncertainty right now not just in what types of products will get acceptance letters but also how quickly the FDA will be able to bolster enforcement. This, at a minimum, gives retailers a little leeway. If regulators can’t inspect stores, then retailers can still sell products if the FDA hasn’t previously stated that a product is illegal.
“Because there is this lag in enforcement, there [are] still [illegal] products on store shelves,” said Clark. “[The regulatory environment in the U.S.] is bad … we are concerned that [the U.S. is] exporting our bad policy ideas and our bad science and bad campaigns. In New York, for example, bad science … helped change people’s minds and vote to advance the flavor ban language.”
In a press note on Aug. 31, Zeller wrote that the FDA plans to make publicly available a list of the deemed new tobacco products that are subject to the Sept. 9 deadline and that were on the market as of Aug. 8, 2016 (it had not been released as of this writing). “However, before doing so, we will need to ensure that the publishing of any such information complies with federal disclosure laws and regulations as only certain types of product information from applications can be lawfully disclosed,” Zeller wrote.
This has left retailers in limbo. Shop owners don’t know if a product they are selling could make them a criminal. Zeller stated that the agency knows of more than 400 million deemed products. To date, the FDA has received applications for around 2,000 products, he said, adding that the agency has processed 40 percent of those. Zeller did not specify how many of those applications were for vapor products. Zeller acknowledged that the FDA was unlikely to be able to review that many applications in the year timeline set for their review.
“Even if applications are submitted for only a portion of those products, the likelihood of [the] FDA reviewing all of these applications during the one-year review period is low given that this would be an unprecedented number of applications and several orders of magnitude greater than anything the agency has experienced,” Zeller wrote. “Depending on the number of new applications we receive by the deadline—which could be anywhere from a few hundreds of thousands to millions—as a matter of practicality, we may not be able to fully complete review of all tobacco product applications that we receive by Sept. 9, 2020, within the year.” The FDA has not announced how many products filed PMTAs.
Zeller also stated that the agency was willing to work with manufacturers. The FDA has said it could allow some smaller manufacturers to submit a “deficient” PMTA and keep marketing products until the necessary data is collected. He said the FDA would accept several justifications for such applications, such as the Covid-19 pandemic and a limited amount of lab space for testing. “Although we expect high quality and complete applications to come in by Sept. 9, if we do find deficiencies, it is likely [the] FDA will issue a deficiency letter with a 90-day deadline for companies to respond,” Zeller wrote.
Orion Saith, with Smoque Vapours Electronic Cigarettes in Chicago, says that her store had already destroyed most of their disposable products because of Chicago’s ban on flavored vapor products. The company is still selling mix-in flavors for e-liquids and has its own line of e-juices as well. “We haven’t taken any juices off the shelves yet. We have our own juice line, and those PMTAs were submitted to the FDA, so we are doing OK for now,” said Saith.
Finding hardware, however, has been extremely challenging. Saith says that knowing what products are legal to sell while PMTA submissions go through the process is getting more difficult by the day. “It is very difficult. We have been getting whatever we can that is still in stock from wholesalers who say that the devices are legal,” she said. “It involves a lot of trust. We have been asking to see submission letters from the FDA too. What’s concerning is that as some of these large major brands leave shelves, the consumers are the ones who suffer. If you can’t get a quality device, you probably end up going back to cigarettes. That’s just a horrible thing to force on someone.”
Credit: Thorn Yang
The FDA has been sending notices to companies selling illegal products. In late April, the FDA issued 10 warning letters to retailers and manufacturers who were selling, manufacturing or importing unauthorized ENDS products that “were clearly targeting use, or likely to promote the use, of these products by young people.” The agency sent three more notices on Sept. 9, the same day PMTAs were due. Zeller said the agency will continue to send warnings.
“All told, since our compliance and enforcement program began in 2010, we have completed over 1.2 million retailer inspections. This has resulted in over 97,000 warning letters, over 11,000 of which were for illegal products,” said Zeller. Many experts predicted the vapor industry would come to end after the PMTA deadline. For now, at least, it will continue.
October 12, 2020
Clear Consideration

Credit: Scott Graham
Aquila Solutions helps vapor companies format their PMTA submissions to FDA requirements.
By Timothy S. Donahue
The deadline has passed. Now, for a vapor product to be sold in the United States, it must gain marketing approval in advance from the U.S. Food and Drug Administration (FDA). As technology for vapor products continues to improve, companies will continue to submit premarket tobacco product applications (PMTAs). The regulatory process is arduous, and experts say many of the FDA’s expectations remain vague.
One of the most challenging aspects of preparing a PMTA for submission is structuring and formatting the publication to meet the FDA’s guidelines. While the FDA has provided a format, the regulatory agency doesn’t quite explain how it wants that formatting to come together, according to Josh Boutwell, founder and CEO of Aquila Solutions, a regulatory submission consultation and electronic publishing firm.
“The format, especially for vapor and tobacco products, is extremely questionable. The FDA doesn’t seem to know what they want or know how it should work, primarily because they were rushed into the format,” explains Boutwell. “What that means is that, yes, there is technically a format, but that doesn’t mean that the FDA or any company really knows where things are supposed to go or how they fit together. Do you need to present things, and what order do you put them in? Do you need to duplicate work, duplicate documents? These are important factors in a regulatory submission.”
Boutwell founded Aquila Solutions in 2010. He had previously worked at major pharma and biotech companies as well as international contract research organizations. In addition to his work in regulatory affairs, Boutwell has worked for the U.S. Centers for Disease Control and Prevention (CDC) in Atlanta, Georgia, as well as conducted research at Emory University.
Since founding Aquila Solutions, Boutwell has managed thousands of projects, including numerous initial regulatory applications. He began Aquila with William McDonald, currently Aquila’s program manager, and the company has slowly grown over the last decade. The past few years, Aquila’s growth has accelerated from 50 percent to more than 150 percent annually. “From last year to this year, we have roughly tripled our production,” says Boutwell.
Aquila Solutions specializes in regulatory publications. For the vapor industry, the company takes data and documents provided by a client and puts them together in a way that “tells a story” to the FDA that is centered on why the submitted application is a product that is beneficial for public health. “The data is meaningless if the FDA can’t find it,” Boutwell explains. Aquila Solutions became involved in publishing PMTAs for next-generation tobacco product clients through word of mouth, according to Business Development Manager Robert “Buddy” Abercrombie. Even though Aquila at the time had not done work for the vapor sector, it had considerable experience dealing with the FDA. When a customer disappointed with the service of its existing publishing company inquired about Aquila’s services, Aquila set up a meeting and researched the PMTA process. “We got the job,” says Abercrombie.
Josh Boutwell
The PMTA process is challenging. Many filers are former traditional tobacco employees, and technology has changed since most tobacco companies made submissions. PMTAs for traditional tobacco products were often submitted in paper form. While paper submissions may still be tendered, the FDA now prefers to receive electronic submissions. “The electronic nature of the Electronic Tobacco Technical Document for PMTAs means that the way a paper is volumized and just having all the documents all together doesn’t match well with electronic submission,” says Boutwell. “We had clients that really wanted to write documents that are hundreds of pages long, explaining everything all in one document, and then having a limited number of appendices. It is better to break the documents down into smaller components that are easier for the FDA to track electronically. Doing things this way also makes it easier for the sponsor to update a submission in the future.”
Many companies that have filed PMTAs were unprepared for the length of time it takes to collect the required data and the physical size of the applications. Submissions have been reported to be anywhere from 40,000 pages to 1 million pages long (one known submission is more than 3 million pages). All that data needs to be organized in a way that best shows the FDA what the data has concluded. Not properly organizing a submission can have catastrophic results.
“The biggest issue is that the FDA requires things to be broken up in specific ways. And if the PMTA hasn’t been compiled properly, the FDA may kick everything back to have it recompiled by the sponsor,” advises Boutwell. “This could essentially cost a company weeks or months of work. The company may even have to do a lot of duplicate work in order to be able to resubmit it.”
Boutwell says a typical PMTA submission is often between 50,000 pages to 100,000 pages unless there are specific or unusual additions. The first step in the process for Aquila Solutions is setting up standard meetings so everyone involved in the project is “on the same page” and understands what is needed.
Robert Abercrombie
“We would discuss the schedule for when documents will come in and make sure we have enough time for checking everything at the end. When documents start coming in, we’ll start figuring out the final structure of the application. Where does it need to go, what does it need to say and how does it interact with everything else?” explains Boutwell. “Then as we actually receive the documents, we process them, make sure they’re usable by the FDA and then create the internal and external links.”
Internal links connect to sections in the same document. External links connect anywhere else. The FDA expects the links to be in the document where they are referenced and only used when necessary.
“The links are necessary, and they must go to where they’re supposed to so that the FDA reviewers can easily analyze your application,” says Boutwell. “Our No. 1 priority is making sure a client’s submission gets through to the substantive review phase. The FDA’s computer servers do their own analysis, and that is followed by an administrative review to make sure that the PMTA is complete enough for a full review.”
Next, the substantive review process can begin. The FDA goes through its scientific process, and before a PMTA is authorized, it goes before the Tobacco Products Scientific Advisory Committee (TPSAC) where it’s decided whether an application meets the standard for the betterment of public health, according to Boutwell.
“Getting the marketing order is the final goal. For Aquila, getting an application accepted is the easy part. The harder part is trying to make the review process as easy as possible for the FDA reviewers. Our experience has been that if you make it too difficult to find things, reviewers will throw up their hands and say, ‘I can’t find it,’” says Boutwell. “Then it’s either outright rejected or the FDA sends you a huge list of questions that they could probably find on their own, but the application was too complicated and time consuming in their view. The point of a PMTA submission is not to make the reviewers miserable. You don’t want a decision-maker annoyed with an application because nothing is where it should be.”
If a PMTA is poorly designed and/or poorly published, the FDA will have more questions than if the PMTA is submitted properly. An application may still get approved because it is technically sound and scientifically sound, but it will be much harder and much more expensive in the long run if you don’t make the effort to make it as user-friendly as possible, explains Abercrombie. “They start off having one question. Then, suddenly, they have 50 [questions]. And then they’ll need more data,” he says. “You set them on that path by handing in an application that just didn’t have it presented in the proper way.”
Vapor industry representatives have repeatedly complained about the vague guidelines provided by the FDA for PMTA submissions and publications. According to them, “They really didn’t give us any guidance on what they wanted, and the only way you can know what they want is after you submit it,” says Abercrombie. “Historically, the FDA uses a five-[year] to six-year rollout process where they propose standards and formats and trial periods and then have it be optional before moving on to it being required. There was none of that for electronic nicotine-delivery system [ENDS] products.”
What’s more, even though ENDS differ substantially from traditional tobacco products, the FDA requires the same data, which is problematic. “We can take tests for [harmful and potentially harmful chemicals] HPHCs, but a cigarette has 5,000 chemical components to it. An e-cigarette has about three,” says Abercrombie. “It’s completely different, and yet they want all this other data.”
Cost is an important consideration in the decision of whether to hire an outside agency for help with a PMTA publication. Boutwell says that submissions due before the Sept. 9 deadline were new projects, so the amount of data was large. Moving forward, the volume of data required—and by extension, the cost—should go down, in part because companies will increasingly be able to reference tobacco product master files in their applications. Boutwell says that, in general, the publishing of PMTA updates costs about $750 and $3 per page for the next 5,000 pages and becomes progressively lower as the number of pages grows. Turnaround could be anywhere from a day to a few months, depending on the size of the submission.
Aquila Solutions has submitted 13 major PMTA applications, including quite a few for leading vapor industry companies. The company has done a variety of e-liquids, hardware and even some nicotine lozenges. Several of its applications have already been accepted and filed by the FDA while others are in their administrative review phase.
“We’ve been able to manage the large projects with clients who have never done this before. I mean, at the time, we hadn’t done it before either, but we had background on how the FDA operates with these types of applications,” says Boutwell. “We were able to help guide our clients to get all their documents in place, written acceptably well, and put together and submitted on the client’s timeframe.”
Looking ahead, Boutwell expects to see a lot of consolidation in the vapor industry. Yet he also can see a scenario where new companies start up after products begin to gain marketing approval.
“There’s going to be a continual influx of new companies to the market. There’s going to be some, I suspect, relatively rapid turnover as well. It’s such a big potential market,” he says. “There will always be someone willing to step up. And then, after some of these applications are approved, there will be a lot of the follow-up products that in many ways will rebuild the market. But that’ll take a couple of years.”
If Boutwell could offer the FDA one bit of advice, he’d suggest the agency pay close attention to the ways its system processes incoming files. Some of the applications Aquila sent to the FDA wouldn’t go through the regulatory agency’s Center for Tobacco Products (CTP) portal. It turns out that the server behind the CTP portal had trouble processing files with “.sas” extensions.
“When you have programs that go with your databases, you need to make sure that they don’t cause issues when you upload data,” says Boutwell. He recommends CTP rename all “.TXT” extensions on SAS files.
Customer reviews for Aquila Solutions have been positive. Many clients say that they appreciate Aquila’s flexibility in getting the job done, according to Boutwell. “The first thing they do is compare us to their previous experience of going through a nightmare to having someone hold their hand and working with them, helping guide them through the maze,” he says. “We are here to support anyone who has an application or wants to submit one.”
October 12, 2020
Forecasting Growth
Market research suggests the global vapor market could exceed $59 billion by 2027.
By VV Staff
Even amidst regulatory concerns, the vapor industry is poised for growth. The latest research suggests that the global market could see a more than 300 percent increase in value in just seven years. Currently, the 2020 global vapor market is estimated at $16.9 billion, according to a July 2020 report from Global Industry Analysts (GIA). The report also projects a 19.6 percent compound annual growth rate (CAGR), reaching $59.3 billion by 2027.
Globally, GIA’s report, E-cigarettes—Global Market Trajectory & Analytics Report, projects double-digit growth in all the major electronic nicotine-delivery system (ENDS) markets, including the United States, China, Japan, Canada and Germany. In the U.S., the world’s largest vapor market, GIA estimates the market’s 2020 value to be $5 billion, growing to more than $20 billion by 2027. Other market analysts have estimated that the U.S. surpassed $8 billion in 2019 and is poised to grow at an estimated 2 percent CAGR between 2020 and 2026.
Credit: Austin Distel
China, the world’s second largest economy, is forecast to reach a projected market size of $10.1 billion by the year 2027 “trailing a CAGR of 18.7 percent” over the analysis period 2020 to 2027, according to GIA. China is expected to be one of the fastest-growing vapor markets over the next seven years, according to GIA. The entire Asia-Pacific region is also forecast to rapidly grow in their vapor markets. “Led by countries such as Australia, India and South Korea, the market in Asia-Pacific is forecast to reach $7.1 billion by the year 2027,” the report states.
Among the other noteworthy geographic markets are Japan and Canada, each forecast to grow at 17.9 percent and 16.6 percent respectively over the 2020 to 2027 period, according to the GIA report. “Within Europe, Germany is forecast to grow at approximately 14.1 percent CAGR,” it states.
Reports on how much the vapor market will grow over the next several years vary, but all reports show growth. According to a recent Arizton Research and Intelligence report, Vape Market—Global Outlook and Forecast 2020–2025, their research shows the e-cigarette industry will grow globally at a CAGR of approximately 15 percent during the period 2019 to 2025.
“The global vape market would realize an absolute growth of 590 percent—a phenomenal leap of over $49 billion revenue between 2015 and 2025,” researchers wrote. “Buoyed by a growing shift in preferences for next-generation smoking products and the demand for HnB [heat-not-burn] tobacco [products] among [the] smoking population, the overall revenue of vape products will reach over $57 billion by 2025.” The Arizton report also predicted that HnB products are set to displace vapor products by 2022, but no other analysts could be found that agreed with that assertion.
An August 2020 report from Mordor Intelligence, Europe E-Cigarettes Market—Growth, Trends and Forecasts (2020–2025), states that the U.K. is the largest market for e-cigarettes in Europe and the second-largest market in the world. Mordor estimates that the European e-cigarettes market could witness a CAGR of 12.98 percent during the forecast period. The U.K. e-cigarette market is growing rapidly because the country’s health authorities promote ENDS products over combustible cigarettes, according to the Mordor report.
Europe captures more than a 33 percent market share of global vapor market revenues, according to the Mordor report, and Poland, Germany, Italy, Russia and the Czech Republic are the major contributors to the European market. Poland has been witnessing tremendous growth, with the revenue increasing from $130 million in 2014 to $542.6 million in 2016, according to Mordor. The growth can be attributed to heavy taxation on traditional tobacco cigarettes and the presence of low-cost vapor products in the country.
“Unlike the U.S. where e-cigarettes have not yet been approved as a cessation device, authorities in the U.K. believe these devices to be a means for people to transition from the much harmful habit of using conventional/combustible cigarettes,” the report states. “On the distribution front, it has been observed that the online retail [segment] accounts for a significant share of the market and, the fastest growing channel [is predicted] to be” specialty vape shops.
An earlier report’s analysis had even higher expectations for the global vapor market. The February 2020 report E-cigarette and Vape Market Size, Share & Trends from Grand View Research estimated the worldwide e-cigarette and vapor market to be valued at $12.41 billion in 2019. That report states the market is expected to expand at a revenue-based CAGR of 23.8 percent from 2020 to 2027. “The market is expected to gain traction over the forecast period, owing to increasing product demand from millennials,” researchers wrote. “The availability of a variety of e-cigarette options is anticipated to further fuel product adoption.”
According to the World Health Organization, there has been a small but steady decrease in the estimated number of cigarette smokers globally to just over 1 billion. The number of vapers, however, has been increasing rapidly—from about 7 million in 2011 to 41 million in 2018, according to market research group Euromonitor. That research estimates that the number of adults who vape globally will reach almost 55 million by 2021.
The Grand View report also found that harsh regulatory environments implemented by local authorities across several countries, including the U.S., India and Germany, have restricted market growth. “Multiple countries have banned the distribution and sale of vapor products, which in turn has led to lower sales,” researchers wrote. “Furthermore, stringent trading laws have made it difficult to import vaping devices for personal consumption.”
Every major tobacco company doing business in the U.S. has filed a premarket tobacco product application (PMTA) with the U.S. Food and Drug Administration (FDA). This allows products to be on the market for a year unless the FDA takes earlier action. Many of the major Chinese vapor hardware manufacturers have also announced PMTA submissions for a small number of products.
According to Arizton, major tobacco companies used their “decades-old established distribution networks” of tobacco products to help gain an upper hand over pure-play companies. “However, small vape and tobacco shops continue to dominate with about 34 percent share of the retail markets worldwide,” say Arizton researchers.
Both the Grand View and GIA reports suggest that the market in the U.S. is especially challenging to predict due to the unknowns surrounding the FDA and the PMTA process. The Grand View report states that “large tobacco companies have flourished by introducing [ENDS] devices through various brands that cater to different requirements, thereby enhancing the product quality and level of customization.”
Grand View researchers state that innovation will continue to be a driving force in market growth across all segments of the industry. “The market is driven by the growing awareness … owing to various medical studies that term e-cigarettes as a safer alternative to traditional cigarettes,” the report notes. “Moreover, the customization options offered by vendors and continuous improvement toward new product development is expected to drive the market growth over the forecast period.”
Both the Grand View and GIA reports state that mod (open system) devices are anticipated to emerge as the fastest-growing product segment over the forecast period. GIA predicts a record 22.1 percent CAGR and reaching a value of $37.4 billion by the end of the analysis period.
One reason all three reports are forecasting a massive rise in open system sales is that when the FDA announced its enforcement priorities in January of this year, the agency did not mention prioritizing open systems. The three urgencies that earned a bullet point were:

Any flavored cartridge-based ENDS product (other than a tobacco-flavored or menthol-flavored ENDS product)

All other ENDS products for which the manufacturer has failed to take (or is failing to take) adequate measures to prevent minors’ access

Any ENDS product that is targeted to minors or whose marketing is likely to promote use of ENDS by minors.
The Grand View report states that the market for smaller rechargeable pod-style devices, such as Juul, generated the highest revenue globally in 2019. “These devices cost fairly less, which is expected to increase their adoption,” the report states. The GIA reports that “after an early analysis of the business implications of the pandemic and its induced economic crisis, growth in the rechargeable e-cigarette segment is readjusted to a revised 15.6 percent CAGR for the next 7-year period.”
The disposable device market is expected to be the second-fastest growing market in the vapor industry through to 2027. According to GIA, the U.S., Canada, Japan, China and Europe “will drive the 16.9 percent CAGR estimated for this segment. These regional markets accounting for a combined market size of $2.3 billion in the year 2020 will reach a projected size of $6.8 billion by the close of the analysis period.”
Credit: Sabrina-Rohwer
The regulatory environment is the biggest unknown in trying to predict the vapor market, according to several financial experts. Regulation is sure to have an impact both short term, such as the PMTAs in the U.S., and long term through flavor bans and taxation globally. At a panel on investing at the Global Tobacco & Nicotine Forum (GTNF) held in September, several industry analysts spoke about the future of the electronic nicotine-delivery systems (ENDS) market and the impact of regulations both in the U.S. and globally.
The panelists agreed that in the European market and in other developed countries that allow vaping, market regulation is more predictable than in the United States and excise taxes in those countries will probably continue to increase (maybe higher than predicted because of Covid-19 economic hardships).
Erika Karp, founder and CEO of Cornerstone Capital, believes that growth will depend on how individual countries approach reduced-risk tobacco products (RRPs), such as snus and vaping. “For instance, South Africa. They are obviously quite anti-tobacco as we’ve recently seen with them during Covid-19 [and banning tobacco products],” she said. “But they are also one of the few emerging markets with a vapor product that BAT [British American Tobacco] recently bought and owns there. So, they’re an example of a market where the government may be a bit more aggressive in wanting to be accommodating towards RRPs and a bit tougher on tobacco.”
Moderated by Erik Bloomquist, a global nicotine and tobacco investment consultant, the panelists said that the FDA had received hundreds, perhaps even thousands, of PMTA submissions. Given the FDA’s track record, however, it is unclear how quickly those applications will be reviewed and decided upon, according to Bloomquist.
“And then it’s unclear how many will actually come through with a successful application.”
Rupert Wilson, owner and managing director of Strategic Business Consulting, said that the recent National Youth Tobacco Survey, released by the U.S. Centers for Disease Control and Prevention (CDC), showed that youth vaping, a major issue with regulators and anti-vapor groups in the U.S., is down significantly from 2019 and 2018. He predicts the U.S. will see an ever-greater drop in youth use over the next two years.
“I don’t think that those numbers (2019) really reflected the impact of Tobacco 21, the removal of flavors, and certainly, then I would expect quite a significant decline again when we get to the 2021 survey coming out in September of next year,” he said. Wilson expects the vapor segment—especially the open and refillable pod systems—to start growing. “That’s already been happening over the last 12 months,” he said. “I would say that the vaping category is going to grow [rapidly], especially as we move into the second half of next year and into 2022.”
Jonathan Fell, partner and co-founder of Ash Park Capital, said the overall ENDS market “remains extremely volatile and impossible to predict.” He says a major factor in the volatility is misconceptions surrounding the use of nicotine. “The debate about whether nicotine use is safe longer term is still a live one. It’s not nicotine that’s the problem. It’s inhaling combusted tobacco smoke,” said Fell. “Companies need to get consumers to reduce overall nicotine intake … Now, that’s what will make the big public health difference.”
October 12, 2020