Are New Regulations Imminent For The Electronic Cigarette Industry?

by Jenny Spring

 Throughout history, it seems, regardless of what new invention or technology is thought up and introduced, no one really seems to care until one specific variable comes into play--money. This has certainly proven to be the case with the electronic cigarette industry as well. When ecigs first began gaining popularity in 2007, no one really paid much attention to it. They were mostly disposable devices, designed to look and taste like analog cigarettes. People saw them in gas stations and convenient stores, but no one really gave much thought to them.

In that period of time, total gross sales of electronic cigarettes was a mere $20 million dollars. That is a far stretch from the over one billion dollar industry it has become today. In a matter of five or six years, the sales of ecigs have exploded to levels undreamed of. What’s more, this growth seems to be increasing at an exponential rate, with total sales expected to double by 2015.

The increase in sales is the direct result of the increase in popularity of electronic cigarette and vaping devices, which has captured the attention of everyone from the government, to the FDA, to health organizations, to religious organizations. Some are concerned about the long-term health consequences of electronic cigarettes, while others are “worried” about the popularity of ecigs among teenagers and young adults. Big Brother, however, as troubled as he appears to be by all of these issues, is really concerned about two things: How to classify and tax electronic cigarettes; and who the industry hurting financially.

At first, it was the tobacco companies that had issue with electronic cigarettes. They lobbied hard and strong to fend off this new alternative to traditional cigarettes. However, they rapidly realized that ecigs are here to stay. So, rather than fighting it, they embraced it by purchasing and growing existing electronic cigarette companies—the most well-known example being Lorillard’s purchase of Blu Cigs. Today, tobacco companies are one of the biggest proponents of electronic cigarettes.

So, who is it that’s bringing all of this new pressure on the FDA to regulate the electronic cigarette industry? Believe it or not, it’s none other than the Pharmaceutical Industry. They claim to be concerned about the health and safety of users of ecigs; however, in reality, this is not the case. The Pharmaceutical Industry, just like any other, is solely concerned about one thing and one thing only: profits. It’s a very simple equation: electronic cigarettes means fewer smokers; fewer smokers means fewer sick people; fewer sick people means less medicine sold; less medicine sold equals lower profits for pharmaceutical companies.

Unfortunately, this undue pressure from Big Pharma has been working. Within the past year, Utah, North Dakota, Arkansas, New Jersey, and Washington, D.C. have all imposed state regulations on the use of electronic cigarettes indoors. California, Connecticut, and Massachusetts are currently working on similar regulations to implement in the early part of 2014. More importantly, nine states, including New York Tennessee, Wyoming, and Colorado have already included electronic cigarettes into the “Tobacco Products” category.

So what does this all mean for users of electronic cigarettes, and the industry as a whole? No one knows for sure how this will all ultimately play out, but one thing is for sure: more regulation is sure to come, and soon. It seems, at least for now, that the focus is on the liquids used in electronic cigarettes devices, called e-liquid or e-juice. As of today, there are hundreds of e-liquid brands, many of which are made by small companies out of garages and warehouses. As of today, there is little or no regulation for these manufacturers, but that is all about to change.

Although it is highly unlikely that there will be an outright ban or moratorium on electronic cigarettes, it is extremely likely that makers will need to obtain specific licenses to manufacture and sell e-liquid. They will need to meet certain criteria to ensure accurate nicotine amounts, etc. Likewise, the resellers of e-liquids will probably also have to obtain a license to sell e-liquid, as is necessary for tobacco sales today. Meeting these requirements will certainly prove costly, and will price out many of the existing small e-liquid makers around today. This will leave just a few large e-liquid brands, and will reduce the variety and innovation enjoyed today.