New FDA regulations may put e-cigarettes out of business

Just once it would be nice to come across a story where the federal government launches a new raft of regulations without it turning into a mess. Sadly, this is not that day.

Earlier this week the FDA announced the upcoming implementation of a new set of regulations ostensibly intended to cover cigarettes and other tobacco products, but which will now sweep e-cigarettes under the same umbrella. As you might expect, this isn’t exactly an industry friendly initiative. (USA Today)

Electronic cigarettes will now be regulated much like tobacco cigarettes and their sale to children banned, according to a new federal rule issued Thursday.

Under the rule, the U.S. Food and Drug Administration would have to approve all tobacco products not currently regulated that hit stores after February 2007. The e-cigarette industry was virtually non-existent before then.

Premium, hand-rolled cigars, as well as hookah and pipe tobacco, are also included in the new regulation, which federal officials call “historic.” The rule prohibits selling “covered tobacco products” to people younger than 18, and buyers must show photo ID.

This package is something of a mixed bag and not all of it is bad, but the first question to address is how and why the FDA decided that they would regulate e-cigarettes under the banner of “all covered tobacco products” when they contain no tobacco. If there’s going to be any serious appeal or court challenge to the rules, that’s likely to be at least one starting point.

That’s not to say that e-cigarettes should be completely beyond regulation. If we’re to accept the idea that any government regulation is beneficial, this is one area which is ripe for it. While the product may not be tobacco in its pure form it does involve nicotine, which is pretty much as addictive as heroin. In that regard, while adults need to make their own decisions about their lives, there’s clearly an argument to be made against allowing kids to get started vaping, leading to a potential lifetime of addiction.

Unfortunately, the regulations do far more than that. One of the biggest concerns is the fact that all products introduced after 2007 (which includes pretty much all e-cigarettes) have to go through an approval process with the FDA. It’s a long and expensive trial and many small start-up businesses who got into this market early may be put out of business by it. (Were I even more cynical, I might suspect that the major tobacco companies haven’t fought too hard against this rule for just that reason. They’re competing in the same market now themselves.)

Finally, while starting kids on vaping is clearly a negative, e-cigarettes have been amazingly successful in helping a lot of smokers quit using traditional tobacco products. They may not be perfect or clean, but it’s widely recognized that they’ve got to be light years better for you than inhaling the smoke from burning tobacco leaves. Stomping on this sort of innovation by way of government regulations is what the government is best at, but it will likely be a major loser for quite a few businesses, as well as those trying to kick the habit.