06 May Initial Review of FDA Rule
Your representatives at the International Premium Cigar & Pipe Retailers (IPCPR) are working diligently to evaluate the impact of the Food and Drug Administration’s (FDA) rule, released yesterday, deeming additional tobacco products subject to its authority under the Family Smoking Prevention and Tobacco Control Act (Tobacco Control Act) on retail tobacconists and manufacturers. In the final rule, the FDA has deemed all cigars a health risk and potentially addictive, despite outreach from Congressional leaders and tens of thousands of comments from industry actors differentiating the premium tobacco industry from mass market.
The Tobacco Control Act, signed into law in 2009, gave FDA authority to regulate the manufacture, distribution, and marketing of tobacco products. However, the original intent of this law was to curb youth access to tobacco products and to prevent health effects of addiction to tobacco products, which does not apply to premium cigars. Youth access to premium cigars is not permitted by IPCPR members and premium cigars are celebratory in nature, with different habitual use patterns than mass market products. By including premium cigars in this regulation, FDA ignored the original intent of the Tobacco Control Act, placing nearly 350,000 domestic and international jobs at risk.
A summary of key provisions in the rule is below:
-Manufacturers of newly deemed products will be required to obtain pre-market authorization.
-Walk-in humidors and consumer handling of product prior to purchase remains permissible.
-Distribution of free samples will be prohibited, even in adult only establishments. (Effective 90 days after implementation of the rule which we expect to be May 10, 2016.)
-Warning labels will be required on boxes and packaging.
-Retailers will be required to post warning signage at the point of sale.
-Retailers blending any amount of pipe tobacco will be required to register as a manufacturer.
Any product not on the market as of February 15, 2007 will be subject to the FDA’s costly and time-consuming premarket review process. The reality of the product approval regime is that there will be fewer varieties of premium cigars on the market. The exact impact is still unknown, but some project up to an eighty percent reduction in stock keeping units (SKU). The product approval process will be fully implemented in three years. However, the reduction in product will likely happen sooner, as many manufacturers determine whether the expense of the premarket review process outweighs the benefit of maintaining a product introduced after the 2007 predicate date.
This is the beginning, not the end. The IPCPR along with partner organizations continue to pursue legislative relief and will likely engage in litigation. Our industry will adapt, and our trade association will continue the fight against government overreach. Consumers and retailers can take immediate action to combat this misguided ruling. Begin by visiting www.ipcprlegislative.org and determine whether your U.S. Senators and Representative have co-sponsored our H.R. 662 and S. 441. If they are not listed as current co-sponsors, please call and email their offices. Click on the “Take Action” link to instantly email your elected officials.
We thank you for your continued patience as we continue to analyze the impact of the 500-page rule with our legal team. Please stay tuned for a comprehensive summary next week.