2020: the year of flavour bans, Juul cases, taxation, China – and that other thing

Who isn’t glad to see the back of 2020? It has surely been a memorable year for everyone, and there are not many people who can say it’s been a good one.

It’s a moot question – one ECigIntelligence will turn its attention to in another article – whether 2021 will turn out to be much better. But here and now let’s look back on these past 12 months, starting at a time when wearing masks in public was strictly for Halloween, Carnival or the Japanese; when we still shook hands when we met each other; when we met each other; when we hadn’t yet heard the term “social distancing”.

Back then, the big baddie of health concern, at least in the US, was the supposed “epidemic” of vaping by young people. Never mind that by then the wave of e-cigarettes’ popularity with American teens was already starting to recede – as we would learn in September when the Centers for Disease Control and Prevention (CDC) published figures showing that vaping by school students had fallen by a third in a year.

That fall was no doubt due in large part to the often hysterical publicity around 2019’s outbreak of lung disease, codenamed EVALI. A year ago that had only recently been shown to be a problem related not to normal vaping but to various nefarious additives, themselves connected to the unregulated – and therefore risky – use of vaping tools to consume illicit substances. In other words, not e-cigs but dope. More specifically, the use of vitamin E acetate as a dilutant. Probably.

 

The flavours question

 

But that’s old news now. What it’s left behind is the still present angst over youth vaping. And in the absence of a vaccine, the widely prescribed would-be cure for that ill is a regulatory clampdown – in many places a proposed or actual outright ban – on flavours.

On 2nd January 2020 the US Food and Drug Administration (FDA) announced that it would concentrate its short-term enforcement efforts on two categories of e-cigarette products: cartridges with flavours other than tobacco and menthol, and any products aimed at minors or whose marketing seems likely to encourage use by minors.

That same week, Californian lawmakers introduced a bill in the state legislature that would ban the sale of all flavoured tobacco products, including those containing menthol. In Wisconsin, governor Tony Evers announced his backing later that month for a raft of bills that would ban e-cigs in school, ban their sale to minors, and involve teachers and healthcare professionals in anti-vape campaigns.

Meanwhile in New York, a Supreme Court judge issued an injunction against governor Andrew Cuomo’s attempt to ban the sale of flavoured e-cigarettes on the grounds that “regulating the vaping industry is a job for the state Legislature, not the executive branch, whose function is to implement the policy set by lawmakers”. That, however, was only a temporary setback to Cuomo’s plan, as the state legislature duly passed the ban in early April.

 

A ban suspended

 

California’s flavour ban, passed by a huge majority in the state House and unanimously in the Senate, was due to come into force this New Year. It has been put on hold, however, until at least 21st January, when all the signatures on a petition calling for a referendum on the measure are expected to have been checked. If 623,212 of the 1m-plus signatures presented are verified, the ban will remain suspended until after it is put to the ballot in November 2022.

The attack on flavours does not end there, however, with countless jurisdictions, at local, state or national level, either having banned them or being in the process of doing so. The hot topic a year ago, it remains so.

Less than two weeks ago, ECigIntelligence reported that Health Canada was considering new flavour restrictions, along with a proposed reduction in the maximum nicotine concentration in vaping products to “contribute to reducing the appeal” to youth.

Canada’s second-largest province, Quebec, is merely the latest to announce an intention to restrict flavours, following the example of New Brunswick and Nova Scotia.

 

Tough times for Juul

 

It was also in Canada, last January, that Juul Labs announced it had anticipated regulatory action by voluntarily halting production of most of its flavoured pods. The market leader – and target of most legal and media outrage over vapes allegedly aimed at kids – stopped supplying Canadian outlets with its mango, vanilla, fruit and cucumber varieties, but but said its tobacco and mint varieties would still be sold in the country.

The move, described by Juul Labs Canada as being aimed at “resetting the vaping category [and] earning the trust of society” did not go down well with the Canadian Vaping Association (CVA), which accused the company of tactics intended to eliminate competition. And it’s not only the CVA which has bared its teeth at Juul throughout 2020.

In February, we reported that Michigan, Texas and Florida were among 39 US states collaborating to investigate “Juul’s marketing and sales practices, including the targeting of youth, claims regarding nicotine content, and statements regarding risks, safety and effectiveness as a smoking cessation device”.

Similar allegations have been at the heart of innumerable lawsuits brought against Juul on behalf of individuals, school districts and others, as we set out to analyse in a special regulatory report in October.

 

Company applies itself – at length

 

Juul announced in late February that it was pulling out of the potentially huge Indonesian market, less than a year after launching there. Shortly afterwards, the company blamed falling sales for its decision to withdraw from South Korea as well as contracting in Europe, planning to leave France, Belgium, Spain, Portugal and Austria because its business models were “not sustainable”. Figures presented by Juul showed revenues in the first three months of 2020 down by 12% on the previous quarter.

At the beginning of April the US Federal Trade Commission (FTC) said it was taking Altria to court over its 2018 acquisition of a 35% stake in Juul, alleging that the agreement between the companies violated federal antitrust laws. That stake had already reportedly fallen in value by 65% in a year – not good news for either party.

On the plus side for Juul or at least the potential plus side in July the company submitted a massive premarket tobacco product application (PMTA) to the US FDA to continue selling its tobacco and menthol pods in the country. Setting a standard few if any others could match, the 125,000-page submission included scientific data from 110 studies evaluating the impact of its e-cigarettes on smokers and non-smokers as well as research about the “harm reduction potential” of the product.

 

And also…

 

If Juul and flavours have been on the ECigIntelligence radar all year, they have not absorbed all our attention. Other recurrent topics have included taxation, actual or planned, in jurisdictions all across the globe for example, in Indonesia, the Philippines, any number of US states, and the EU, where talk of tax harmony between member states has been a running theme. The vexed and vital issue of tax policies was the subject of another special regulatory report from ECigIntelligence in October.

Other long-running stories of 2020 have been the steady gradual tightening of anti-tobacco (and anti-vaping) rules in the Netherlands, where health minister Paul Blokhuis has made himself something of an international spokesman on the subject; Australia’s dithering over its on-off import ban and prescription-only e-cig policy; and the massive potential of China from both market and regulatory perspectives.

Oh, and there was one other thing that took our attention. We first mentioned it in February, when we wrote: “The novel coronavirus (COVID-19) that has so far killed more than 2,600 people in China has had limited impact up to now in the vaping industry around the world, but severe movement restrictions have led to fears of disruption.”

And if you want to know how that story developed (so far, anyway), the salient points, as far as the vapour business is concerned, are all here.

Here’s hoping that 2021 turns out a lot better for all of us.

Aidan Semmens ECigIntelligence staff

Photo: Wikimedia Commons

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