Important Judicial Rulling Every Vaper Needs to Know About

May 17, 2019

A judicial ruling was handed down yesterday that all vapers need to be aware of.

Court Decision American Academy of Pediatrics v. FDA

In May of 2016, the FDA issued what is called the "Deeming Rule" which essentially "deemed" vape products to be under the FDA's purview and subject to the same regulations that already covered tobacco products. The rule gave vapor products four avenues to stay in business:

  1. Predicate Tobacco Product
  2. Substantial Equivalence
  3. Exemption from Substantial Equivalence
  4. Premarket Tobacco Application

Any vape products that didn't successfully navigate one of these four pathways would have to be pulled off the market.

FDA Regulatory Compliance

Predicate Tobacco Product

Any vapor product that was on the market and being sold in the United States prior to February 15, 2007 would be grandfathered in. Unfortunately, there were only a very, very small number of vape products on the market before that date given the fact that the electronic cigarette had only just been invented in China a few years earlier. The first electronic cigarettes didn't hit U.S. shores until about 2006 or 2007. However, these early e-cigs and e-liquids have since been replaced with vastly superior products so even if you were lucky enough to own one of these grandfathered brands, your product would likely be such a big step backward compared to what U.S. vapers are now used to that your Predicate Product wouldn't likely be worth much.

Substantial Equivalence

If a manufacturer wants to claim substantial equivalence, they have to show that their product is "substantially equivalent" to a Predicate Product that was grandfathered in. They also have to show that the new product doesn't raise any new public health questions.

Exemption From Substantial Equivalence

This path is very similar to Substantial Equivalence with a few technical differences. To claim exemption, the vape product and the Predicate (or grandfathered) Product that it is claiming to be equivalent to must both be owned by the same manufacturer. In addition, the manufacturer has to show that any changes are minor, such as adding, deleting or changing the quantity of an additive.

Premarket Tobacco Application

This is the category into which almost all vape products will fall. To successfully navigate this gauntlet to FDA approval, a vape product has to go through a lengthy, time consuming and extraordinarily expensive process to prove it is not going to have a negative effect on public health.

While that in itself is a noble goal, unfortunately the way the FDA has written it, many feel it is nothing more than excessive bureaucracy and red tape. For example, it would not be enough for a single vape juice flavor, Celestial Honeydew for example, to apply for and receive this approval. Celestial Honeydew in 3 mg of nicotine is considered a different product than Celestial Honeydew in 6 mg. Every nicotine level of every flavor would have to go through the same process separately, including requiring the manufacturer to fund separate clinical trials. Obviously since the only difference between Celestial Honeydew 3 mg and Celestial Honeydew 6 mg is slightly more nicotine, this is not really protecting anyone. It is estimated to cost manufacturers up to several million dollars per nicotine level, however.

Because this burden is so onerous, it would effectively spell the end of at least 90% of vape businesses--essentially, as many people have pointed out, handing the industry to Big Tobacco since Big Tobacco would be just about the only ones able to afford it.

The Importance of Yesterday's Ruling

When the FDA first issued the Deeming Rule in 2016, it gave vape manufacturers about a year to file applications and about another year to get through the process (smaller manufacturers would have a little extra time). This would have put most vape manufacturers out of business in 2018 or 2019.

However, the FDA, realizing that manufacturers reasonably needed more time and also noting it's own lack of clear guidance that would be necessary in order for manufacturers to comply, extended the deadline to file applications to August 8, 2021. The vape industry breathed a collective sigh of relief.

Sigh of Relief

That is until a group of public health entities sued the FDA over this extension. The groups claimed the FDA was shirking it's responsibilities to public health by extended the deadline.

A ruling was issued in this lawsuit yesterday by Judge Paul Grimm in the District Court of Maryland siding with these public health organizations and ruling against the extension granted by the FDA.

District Court Ruling

What This Means for Vape Products

Bottom line, this ruling means we are back in regulatory limbo. This could play out in one of two ways.

The FDA has the option to appeal the decision and many believe this is the most likely course of action. Things would remain tied up in the courts and the extended deadline of 2021 would remain in effect until a higher court ruled.

FDA to Appeal Judicial Ruling re: Deeming Rule

If the FDA does not appeal, however, the appropriately named Judge Grimm's ruling will stand. That ruling gives the FDA a period of 30 days to issue new guidance and procedures for moving forward with the Deeming Rule without the deadline extension.

Because the original deadline in 2018 has already passed, this could mean that, if the FDA really wants to stick it in and break it off, it could decide that applications are more or less immediately due. If that were to happen, many vapor businesses would likely close their doors overnight. Others might try to file applications in order to buy themselves another year in business before shuttering due to the exorbitant cost of a Premarket Tobacco Application.

Only time will tell.

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