FDA Economic Impact Analysis

[Jman8]

That's how I figure it. Day 1 of final decision. "Oh btw We reject all applications for new products" they are gateways to cigarettes and have flavours.

..."and we're very okay with creating a black market that will be even wilder than the wild west that was previously in place."

 

[Jman8]

It is significant. That's the point of Regulatory Flexibility Act (RFA). It requires agencies, like the FDA, to consider the impact of their regulatory proposals on small entities, to analyze effective alternatives that minimize small entity impacts, and to make their analyses available for public comment (per the RFA Nutshell).

Given how proposal reads and Impact Analysis is worded, up to the point of alternatives, I strongly believe this is where we need to push as consumers and encouraging all small vendors to push.

I am curious how we can get SBA involved for 'advocacy.' Perhaps not best word, but a way in which vendors can connect with an official entity to get guidance in similar way consumers may get guidance from CASAA.

I also think it needs to be clear that the alternative doesn't change much from what FDA was proposing in terms of allowing businesses to stay on the market. It's not like we are seeking an alternative that if not invoked would shut down all businesses the moment the rule is in effect. FDA has already said those businesses will remain open. And as they have huge backlog that is well known, this works to our advantage in pushing for the alternative, plus works toward FDA's advantage in having even less of a backlog. Plus alternative allows FDA to gain the regulatory authority it seeks, and makes it so businesses at a certain point, who wish to offer new products would have to submit market applications.

It really is a win-win situation.

Unless you just so happen to be ANTZ.

 

[Fitzie]

I apologize for all the legal bs and not explaining what I'm trying to say better. I'll give it another shot. Like I said, I'm no expert on the Regulatory Flexibility Act.

There are 3 options in the IRFA (the FDA's cost/benefit analysis as it were). The first 2 don't seem to address e-cigs. Number 3 does. I think the Regulatory Flexibility Act could get us to option 3 if we can prove that small vaping businesses would be driven out of business if the 2/15/07 (grandfather date) becomes the "deeming" date for e-cigs. If instead, the date the regs are enacted is used as the "deeming" date, then there will be "predicates" and the substantial equivalence process would be used instead of the new product process.

3. Change New Product “Grandfather Date” to the Date of Issuance of a Final Deeming
Regulation (this is from the IRFA)

Under this alternative, the grandfather date for determining which products are
considered new would be moved from February 15, 2007, to the date this rule is finalized. All
other aspects of the rule would remain as proposed. This would reduce costs in the first 24
months as new product submissions would not have to be prepared for products introduced into
domestic commerce between February 15, 2007, and the date of the final rule; that is,
manufacturers would not start with such a large multi-year backlog of new products.63 However,
manufacturers would still bear the substantial costs of preparing new product submissions for the
new products introduced each year.

If no valid predicate exists for electronic cigarette products, then changing the
grandfather date would have additional implications for electronic cigarettes. In our analysis of
the proposed rule, all electronic cigarette products would be new tobacco products and many
would exit the market rather than bear the cost of submitting a premarket tobacco application,
which would be required in the absence of a valid predicate product. By contrast, if we change
the grandfather date, only electronic cigarette products introduced after the issuance of a final
rule would be considered new, and a large number of candidate predicates would exist. We
assume that new electronic cigarettes would then be marketed through the substantial
equivalence (or exemptions) pathway. We would no longer assume that many electronic
cigarette products would exit the market, but instead assume that all electronic cigarette labels
would be changed to conform with the requirements of the proposed rule.

 

[Kent C]

I apologize for all the legal bs and not explaining what I'm trying to say better. I'll give it another shot. Like I said, I'm no expert on the Regulatory Flexibility Act.

There are 3 options in the IRFA (the FDA's cost/benefit analysis as it were). The first 2 don't seem to address e-cigs. Number 3 does. I think the Regulatory Flexibility Act could get us to option 3 if we can prove that small vaping businesses would be driven out of business if the 2/15/07 (grandfather date) becomes the "deeming" date for e-cigs. If instead, the date the regs are enacted is used as the "deeming" date, then there will be "predicates" and the substantial equivalence process would be used instead of the new product process.

3. Change New Product “Grandfather Date” to the Date of Issuance of a Final Deeming
Regulation (this is from the IRFA)

Under this alternative, the grandfather date for determining which products are
considered new would be moved from February 15, 2007, to the date this rule is finalized. All
other aspects of the rule would remain as proposed. This would reduce costs in the first 24
months as new product submissions would not have to be prepared for products introduced into
domestic commerce between February 15, 2007, and the date of the final rule; that is,
manufacturers would not start with such a large multi-year backlog of new products.63 However,
manufacturers would still bear the substantial costs of preparing new product submissions for the
new products introduced each year.

If no valid predicate exists for electronic cigarette products, then changing the
grandfather date would have additional implications for electronic cigarettes. In our analysis of
the proposed rule, all electronic cigarette products would be new tobacco products and many
would exit the market rather than bear the cost of submitting a premarket tobacco application,
which would be required in the absence of a valid predicate product. By contrast, if we change
the grandfather date, only electronic cigarette products introduced after the issuance of a final
rule would be considered new, and a large number of candidate predicates would exist. We
assume that new electronic cigarettes would then be marketed through the substantial
equivalence (or exemptions) pathway. We would no longer assume that many electronic
cigarette products would exit the market, but instead assume that all electronic cigarette labels
would be changed to conform with the requirements of the proposed rule.

But this goes back to the point I realized just earlier. See my post #13 where I brought it up and pamdis' post #14.

 

[Fitzie]

Exactly. It's your post #13. It was your point. Just with more explanation because it seemed I read in who know's what post that "grandfather" wouldn't work and thought everybody gave up on it.

And, since I thought your post #13 was so valuable, I decided to do more research.

 

[Jman8]

I think the Regulatory Flexibility Act could get us to option 3 if we can prove that small vaping businesses would be driven out of business if the 2/15/07 (grandfather date) becomes the "deeming" date for e-cigs.

We would no longer assume that many electronic
cigarette products would exit the market, but instead assume that all electronic cigarette labels
would be changed to conform with the requirements of the proposed rule.

FDA has provided the proof for us, I would say. Not just in this blurb, but in entirety of Impact Analysis, and indirectly, in the proposal.

Plus I know about 200 people on ECF who are absolutely certain small vaping businesses would be driven out of business if 2/15/07 is the date from which all businesses must operate from, while market applications are hundreds of thousands of dollars.

 

[Kent C]

Exactly. It's your post #13. It was your point. Just with more explanation because it seemed I read in who know's what post that "grandfather" wouldn't work and thought everybody gave up on it.

And, since I thought your post #13 was so valuable, I decided to do more research.

I'm not claiming credit here. It was pam's post 14 that dismisses my idea. It didn't sink in at the time for me.... that was more my point. The post #13 was just a guide to that sequence.

eta: ok Fitzie, I see now that isn't what you were saying.....

 

[aikanae1]

The FDA said they considered moving the date to the one where it went into effect (2009) but didn't have legal authority. That seemed to be backed up. It would take a change from congress to do.

 

[Kent C]

The FDA said they considered moving the date to the one where it went into effect (2009) but didn't have legal authority. That seemed to be backed up. It would take a change from congress to do.

Where'd you see that? It seems odd, in that the impact doc states all the options in terms of different starting dates. And it was still only published in 'April 2014' with the deeming doc coming out on the 24th. One would think that a 'bad date' wouldn't have come up in between but perhaps.

 

[pamdis]

Where'd you see that? It seems odd, in that the impact doc states all the options in terms of different starting dates. And it was still only published in 'April 2014' with the deeming doc coming out on the 24th. One would think that a 'bad date' wouldn't have come up in between but perhaps.

In the middle of page 119 of the rule

We do not believe that we have the authority to alter or amend this grandfathering date, which is set by statute.

The impact analysis, I believe is required to show that they 'considered' different options to minimize the impact of the rule. So, they 'considered' it, and then dismissed it in the rule itself.

 

[Kent C]

In the middle of page 119 of the rule



The impact analysis, I believe is required to show that they 'considered' different options to minimize the impact of the rule. So, they 'considered' it, and then dismissed it in the rule itself.

Thanks Pam.... typical..

 

[pamdis]

It might still be an avenue worth pursuing. I'm not trying to discourage anyone from taking it, I just want everyone to be aware of the full context when they try to fight back on it.

So, instead of hitting them with, "Hey, you said it was an alternate route, why didn't you take it?", we could say "Hey, you considered this, and dismissed it because you didn't think you could, but here's how/why I think you can..."

 

[Kent C]

It might still be an avenue worth pursuing. I'm not trying to discourage anyone from taking it, I just want everyone to be aware of the full context when they try to fight back on it.

So, instead of hitting them with, "Hey, you said it was an alternate route, why didn't you take it?", we could say "Hey, you considered this, and dismissed it because you didn't think you could, but here's how/why I think you can..."

Well it helps pinpoint the key - congress established the date, only congress could change it. It seems rather arbitrary that it is the date of 'introduction' of the bill rather than the passage of the bill or the President signing it into law. It's the date Waxman introduced it. Seems odd... or it was chosen for the reason that they knew finding a predicate product would be harder to find with that date.

I don't think it closes the door. But they're pulling from the other side lol.

 

[Fitzie]

Okay, I now agree it probably does close the door as Congress would have to amend the statute. But it still makes me wonder why the FDA used the word "believe" as opposed to "can't" in the IFRA regarding the 2007 date. How can the FDA comply with the RFA when the one alternative they offer for e-cigs is essentially a non-option? Why do I even ask? I was very happy to retire with some semblance of sanity left (and my integrity intact). The government I proudly went to work for in the 70's wasn't the same government when I left. I'll spare everyone the details ...

With that said, I'll continue to poke around and see if I can find anything useful. Out of curiousity, I wonder if there's something in the legislative history concerning the effective date.

 

[Fitzie]

Interesting. Senator Burr was an advocate for tobacco harm reduction way back when they were debating the FSPTCA. He and Senator Hagan offered an amendment that would have put tobacco control under HHS rather than the FDA, among other things.

Senator Burr had a lot to say about the 2007 date:

"One has to ask: Why February of 2007? Why is that magic? It is very simple. That is the last time they updated this bill. I am sure they updated before the markup in 2009, but they weren't even careful enough to change the effective date that cut off when a product could be sold. There can't be any other reason, because there is nothing magical to February of 2007, except that U.S. smokeless products were included, and if you include U.S. smokeless products and filtered and nonfiltered cigarettes, you might have one manufacturer that then controls about 70 percent of the market. And because you have grandfathered it all in and you have forbidden FDA from ever changing it, you have basically given an unbelievable market share to one company, and you have not allowed any other company in the world to participate because if they weren't sold before February of 2007, they can't be sold in the future. Because, as I discussed earlier, to bring a new product to the marketplace, you have to make the claim that no nontobacco user would use the product.

Yet how can you make that claim if the same provision disallows you from talking to a non-tobacco user about whether they would use the product? It is a catch-22. Yes, we created a pathway, but we also designed it in a way that you couldn't meet the threshold needed to have an application approved. It is very simple."

Citation: The above quote is from the Congressional Record (Senate - June 4, 2009, page 56166)

 

[aikanae1]

Here's one legal opinion discussing the grandfather date http://www.khlaw.com/webfiles/What_To_Expect.pdf

It is also important to understand the basis of the original Feb. 15, 2007, grandfather date. That was the date the original bill that eventually became the Tobacco Control Act was first introduced into Congress,

At the time, Congress had not contemplated including e-cigarettes (which were just being introduced into the U.S. market) or other nontraditional tobacco products in the legislation. Nowhere in the legislative history of the act was there any discussion or even mention of e-cigarettes or other novel nicotine-only recreational products.

Two much more appropriate grandfather dates for e-cigarettes would be either the date that the NPRM for the deeming regulation is finally published in the Federal Register or April 25, 2011, the date the agency published its letter to stakeholders indicating that it intended to capture e-cigarettes through the deeming regulation. Either of these dates would make more sense for e-cigarettes than the original grandfather date provided in the statute.

It does not appear, however, that the FDA has the legal authority to change the grandfather date set forth in the Tobacco Control Act for the newly deemed products. Rather, the more likely scenario is that the agency will use its “enforcement discretion” to adjust the requirement for e-cigarettes to prevent the collapse of the market. For example, the FDA may allow e-cigarette and e-liquid companies to continue selling their products already on the market, as long as they submit a premarket application (i.e., a substantial equivalence report) for those products before some deadline in the future (e.g., 21 months after the NPRM is published). Those applications will remain pending until the FDA has a chance to review them (which could take years) in the same way that tobacco companies were allowed to file provisional substantial equivalence reports for their products marketed after Feb. 15, 2007, but before March 23, 2011.25

IMO, this is squarely in the "I don't have a clue" category. To me, it sounds like there are two seperate issues; coverage of new / novel tobacco products and the effective date.

I don't think it's reasonable to apply a hard-coded effective date to products that aren't in existance yet.

 

[Kent C]

Interesting. Senator Burr was an advocate for tobacco harm reduction way back when they were debating the FSPTCA. He and Senator Hagan offered an amendment that would have put tobacco control under HHS rather than the FDA, among other things.

Senator Burr had a lot to say about the 2007 date:

"One has to ask: Why February of 2007? Why is that magic? It is very simple. That is the last time they updated this bill. I am sure they updated before the markup in 2009, but they weren't even careful enough to change the effective date that cut off when a product could be sold. There can't be any other reason, because there is nothing magical to February of 2007, except that U.S. smokeless products were included, and if you include U.S. smokeless products and filtered and nonfiltered cigarettes, you might have one manufacturer that then controls about 70 percent of the market. And because you have grandfathered it all in and you have forbidden FDA from ever changing it, you have basically given an unbelievable market share to one company, and you have not allowed any other company in the world to participate because if they weren't sold before February of 2007, they can't be sold in the future. Because, as I discussed earlier, to bring a new product to the marketplace, you have to make the claim that no nontobacco user would use the product.

Yet how can you make that claim if the same provision disallows you from talking to a non-tobacco user about whether they would use the product? It is a catch-22. Yes, we created a pathway, but we also designed it in a way that you couldn't meet the threshold needed to have an application approved. It is very simple."

Wow. As an investigator might say 'that shows motive' Even though they may not have known about ecigs (perhaps they did though) they were setting up the market against almost anything but combustible tobacco.

 

[Jman8]

IMO, if we push this, we push for the language in the alternative and don't look at this as something that needs to be negotiated with FDA. They've already precluded themselves from that sort of alteration.

Burr has been at this longer than many in Congress (arguably longer than anyone else). He understands the technological point and harm reduction. Thus, he has authority to make the push to amend, but obviously it would be an item that would take congressional act. Still, we are a community that is making huge deal out of this point (that small businesses will be exited) and so we have enough motivation from consumers (many but likely not all) and from vendors (plausibly all of them). And as this stands fairly decent chance of being a partisan issue, we could assume that all Republicans in congress would be on side of 'small business' whereas dems would be on side of 'safety first.' Yet, Burr addressed that in hearing yesterday and in my view Zeller and Harkin came up empty or hemming and hawing on the harm reduction tangent. Harkin clearly has an agenda, but Zeller isn't as overt on that sort of agenda, and again, doesn't really matter what FDA feels right now, as this issue is one for Congress to debate/work out.

I think this stands very good chance and if defeatist attitude from our end is saying not even worth trying, then I think we deserve FDA proposal as is. Sorry if that offends anyone, but I say drop the defeatist attitude. What do we have to lose by pushing for this?

 

[aikanae1]

Wow. As an investigator might say 'that shows motive' Even though they may not have known about ecigs (perhaps they did though) they were setting up the market against almost anything but combustible tobacco.

I thought that's why it was nicknamed the "Protect Marlboro Act".
How Philip Morris, Tobacco Foes Tied the Knot : Roll Call News

RJ Reynolds has dubbed the bill the “Marlboro Monopoly Act.”

I think one of the problems I'm having is trying to nail what will be the most effective way to mount a challenge. I might discover oodles of background information and 99.9% will mean nothing in the real world, riight now. I don't know how accurate this is (below);

This post begins a series of unknown length that will analyze the scientific claims being made in the draft regulation, the associated economic impact statement, and any other partially-scientific documents that are produced. While there is substantial unhappiness about the proposed regulations, and protests that it is just not the right thing to do, it is unlikely that these will have a large influence on FDA’s final decision or any adjudication of it. Third party reviewers of FDA’s actions (i.e., courts) will probably be much more concerned with details of whether the science supports the claims and whether the claims support the policies. This series focuses on those questions and attempts to avoid any normative analysis (other than about epistemology).

Scientific claims in the FDA deeming regulation (part 1 of ???) | Anti-THR Lies and related topics

The hearing yesterday, and I assume most of the evidence that Democrats are relying on comes from this document; http://www.durbin.senate.gov/public...?File_id=81d14ff7-f2f6-4856-af9d-c20c0b138f8f

Which is an "OMG" report of bad investigations. The only manufacturers looked at were Altria, RJR, Njoy, Eonsmoke, LOGIC, VMR, Lorllard, Green Smoke and Lead by Sales. WTH? They do not represent "the market". The whole document is so flawed that it can't even be cherry-picked for data. The report was probably developed in association with TVECA.

Electronic Cigarettes Affecting Nicotine Replacement Therapy Sales | E-Cigarette Reviews and Rankings

Giants like GlaxoSmithKline (GSK), the maker of Niquitin products, are struggling to compete with electronic cigarettes, which smokers trying to quit seem to find more appealing.

Zeller is from GlaxoSmithKline.

Remember at the end of the hearing that Harkin went on about how available "FDA approved" cessation products are, stated several times they were effective and commented that the ACA will cover them.

So what?

 

[Kent C]

Here's one legal opinion discussing the grandfather date http://www.khlaw.com/webfiles/What_To_Expect.pdf


IMO, this is squarely in the "I don't have a clue" category. To me, it sounds like there are two seperate issues; coverage of new / novel tobacco products and the effective date.

I don't think it's reasonable to apply a hard-coded effective date to products that aren't in existance yet.

Great find. I'm wondering if this came up in Media/news and I missed it but it goes right to the problem, imo. In fact, while reading, I'm thinking this is close to what I think would be a good 'comment' to submit to the FDA.

It also points to the problem that both the FDA and CDC have - in essence, their 'goal' (raison d'être). Chowdhury: "Put simply, this comes down to whether the availability of the new product will adversely impact smoking/tobacco use initiation and cessation rates."

One of the main ways those agencies can justify their reason for existence, are the statistics that show that. When the percentage of smokers stat goes from 24% in 2005/06 to 18.1% at present, that's good! When the incidence of first time ecig use in teens is doubling - when they define ecigs as 'tobacco/nicotine use', that's bad! .... even though:

"It has subsequently been revealed, however, that nine out of 10 high school students in that survey who reported vaping in the previous month were already cigarette smokers, suggesting that the increase in e-cigarette use is a positive step toward harm reduction."

This is why Zeller agreed with Sen. Burr on the 'does ecigs reduce harm' question - only for individual hard core smokers, but disagreed with him on the 'collective' "for the public good" (which btw, makes this a 'basic political orientation' issue), because as they see it, 'ecigs promote continuous use rather than ending it'. But as I would see it - it changes an activity "smoking" that is going to happen anyway with experimenting kids, into a less harmful version of "vaping".

...

But regardless of that, they have the power right now, so my suggestion would be to get Congress to change their goal to reducing smoking - ie. "harm reduction" and change the grandfather date to later, and let them collect statistics to show what a good job they're doing. That way, vaping would be part of their solution.