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  • Sally: Last April, the FDA issued deeming regulations which officially put electronic

  • nicotine delivery devices under the umbrella of the FDA.

  • And in the course of doing so...well, that's what I'm...I'll throw that to you.

  • What has the FDA proposed, or enforcing, I should say?

  • Clive: With any regulation, your starting point should be what is the problem to which

  • this regulation is the solution, or what is the risk to which this regulation is the mitigation

  • response?

  • And the problem for the FDA is that there isn't actually very much wrong.

  • In fact, there's a lot right.

  • So we've seen...there's now eight and a half...there's about 38 million smokers in the U.S., about

  • 8 and a half million vapers, and about 2 and a half million of them are people who no longer

  • smoke, okay?

  • So that's now a large-scale phenomenon relative to smoking, around quarter of the kind of

  • size, if you like.

  • But there's nothing really going wrong.

  • Most people who do it are quite happy about it or they wouldn't be doing it.

  • No one's making them doing it.

  • Many people have stopped smoking.

  • Many people are getting short-term benefits from it.

  • Smoking prevalence amongst adults is a record low, and falling rapidly.

  • Smoking prevalence among teenagers, it's a record low and has been falling rapidly.

  • You know, what's not to like?

  • What is the problem?

  • So what we get then is the hunt for the problem, and we see FDA spending a fortune on academic

  • studies.

  • We see CDC getting in alongside, problematizing the issue, okay?

  • So you'll see studies and you'll see talks about flavors, gateway effects, you know,

  • additives, and so on.

  • All of these things are essentially designed to create a sense of alarm that justifies

  • a regulatory intervention.

  • And one of the really terrible consequences of that is the misalignment of perceptions

  • of risk in the American public between what is real about e-cigarettes and what they think.

  • And roughly speaking, I think it's just over 5% of Americans would say e-cigarettes are

  • much less harmful than cigarettes, which is the right answer.

  • It can only be that answer.

  • Thirty-seven percent say the same or worse, and another 36% say, "I don't know."

  • Sally: And that perception has been changing over the last few years in the direction of

  • more ignorance.

  • Clive: In the wrong direction.

  • which is amazing.

  • So, to me, I mean, this is why Public Health England, Royal College of Physicians had come

  • out and been so clear about giving people an anchor, quantified anchor, you know, at

  • least 95% lower risk, so that it cuts through all the stuff that you're seeing in the newspapers

  • that's very alarming.

  • They say, "Well, no, if you put it context, it's all very, very much lower."

  • And I think that is a piece of collateral damage that has been done to the American

  • public by these agencies as they've tried to justify regulation, okay?

  • So next, we look at the regulation that they're actually proposing, which is...I mean, when

  • people ask me, "Is there anything good about the EU regulation?"

  • I say, "No, the only good thing is it's not the FDA, okay?"

  • And that is the only good thing you can say about it.

  • The FDA's regulation has a number of totally terrible features to it.

  • It's incredibly burdensome.

  • That's the big thing.

  • Very, very expensive, and it's very, very broadly applied to literally thousands of

  • products, product components, product variance, all need this full-scale authorization with

  • full justification to the FDA, repeated endlessly over and over again for roughly the same products

  • between companies within companies.

  • It's so massively wasteful, it's off the scale.

  • The second really negative feature of their regulation is you don't know what it takes

  • to be successful.

  • With the EU regulation, it's quite burdensome, but you do know that if you do the things

  • that are required, you can put your product on the market.

  • You know that with certainty that if you comply with quite clear regulations, it's on the

  • market, no problem.

  • With the FDA, they have to decide.

  • Somebody makes a decision to authorize your product and you don't know.

  • And this is the killer.

  • You don't know what their criteria are and how they will judge the evidence that you

  • put forward, what hurdle, evidential hurdles they want you to cross.

  • You cannot tell that in advance.

  • So that makes it harder for the companies who aren't giant tobacco companies to raise

  • the finance to...

  • Sally: Who can't even afford to...this application process.

  • Clive: Yeah.

  • Can they afford it in the first place?

  • They don't really know what the cost are going to be or how long it will take.

  • So how does that play into their financing?

  • Because it looks like a giant regulatory risk.

  • So many of them don't have particularly strong balance sheets, so they're looking to external

  • finance and refinancing their operations, and their investors go, "Well, this doesn't

  • look good, guys."

  • And we've already seen NJOY go down for that reason, or that and amongst other reasons.

  • So I think it's very harmful, and there's arguments like, "Well, will it take out 90%

  • of the market?

  • Or will it be 99% of the market?"

  • We shouldn't be having an argument about that.

  • You would be taking out 90% of something that is basically quite successful.

  • You know, large number of users, lowest-ever smoking rates.

  • Everybody's happy, and yet you think it's a good intervention to take out 90% of what's

  • driving that marketplace.

  • How can that be right?

  • They haven't assessed the likely unintended consequences that will flow from that intervention.

  • And it doesn't mean...it doesn't need that many extra smokers before you've got a detriment

  • that hugely outweighs any conceivable benefit from these regulations.

  • Sally: So what are the avenues of redress look like from the congressional legislative

  • standpoint?

  • And then we'll get into the other standpoint, which is the courts.

  • Clive: Yeah.

  • Well, I mean, the issue...I mean, tthere's two ways out of this.

  • There's a sort of legislative fix, which would essentially treat e-cigarettes now in the

  • same way that cigarettes, which we treated in 2009, which basically is if they're already

  • on the market, they can stay on the market, okay?

  • There's a fix in the legislation called moving the predicate date, which means if you're

  • on the market at this date, then you stay on the market and you only have to apply for

  • these burdensome applications if you do something completely new, okay?

  • That doesn't solve the problem totally, but it gives respite and would end the apocalyptic

  • emergency that the FDA is about to visit on that industry.

  • It would stop that and give time to put a sensible regulatory framework in place, okay?

  • And the difficulty with that is that the democrat side, moratory side, has been sold on the

  • idea that this is a get-out-of-jail-free card and that this would allow rogue traders, you

  • know, to go out and hook kids and everything.

  • So all the nonsense public health arguments are being played into trying to stop this

  • and make sure the apocalyptic regulatory intervention that the FDA has in mind goes ahead and destroys

  • the industry and leaves only the tobacco industry standing.

  • Why they want that is a mystery to me, but that will be the effect, even if it wasn't

  • the intent.

Sally: Last April, the FDA issued deeming regulations which officially put electronic

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Clive Bates: What are the regulations the FDA is enforcing on the e-cigarette market? | VIEWPOINT

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    Danny Wang posted on 2017/10/24
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