The increasingly heated competition between makers of the two top-selling U.S. electronic cigarettes has extended into the public comments arena.
The Food and Drug Administration recently accepted comments as part of the regulatory process for its proposal to heighten e-cig regulations.
Juul Labs Inc., manufacturer of No. 1 e-cig brand Juul with a 74.6% market share, has drawn the main focus of FDA regulators, in particular former commissioner Dr. Scott Gottlieb, for the product’s design and flavor appeal to youths.
Juul is sold in the form of a pen or a USB device. That design makes it easy to hide, which Gottlieb says has contributed to “an epidemic” of teenage use, albeit based on a small sample size nationally.
Gottlieb recommended on Nov. 15 removing e-cigarette flavors, with the exception of menthol, mint and tobacco.
Meanwhile, R.J. Reynolds Vapor Co. has sought to separate and distinguish its No. 2 Vuse product, which has a 13.7% market share, from Juul in terms of potential new regulations.
So much so that Reynolds’ public comment, filed April 29, targeted Juul in several sections of its 22-page letter.
“We believe that any change to FDA policy in this area should be carefully focused,” wrote Michael Ogden, senior vice president of scientific and regulatory affairs for RAI Services Co.
“(The) FDA already has identified the main driver of youth interest: Juul. As the agency’s public statements confirm, underage users disproportionately prefer Juul to all other products in the ENDS (electronic nicotine delivery systems) market.”
Ogden cited an April 8 letter sent to the FDA by 11 Democratic U.S. senators in which they said “Juul is driving this epidemic” of youth usage of e-cigs.
Ogden claimed that other brands, “such as Vuse, have not been found to have contributed significantly to the spike in reported youth use.”
British American Tobacco Plc, Reynolds’ parent company, told analysts in March that 94% of its Vuse e-cig consumers are at least age 25 and more than 60% are at least age 35.
Ogden said Reynolds fears the FDA will “indiscriminately penalize the entire portfolio of flavored ENDS products” rather than primarily rein in Juul.
Ogden said that “while it is unclear whether the measures proposed in the ENDS compliance draft guidance will curb youth access, they are likely to have a negative impact on the overall public health ... by limiting current cigarette smokers’ access to many ENDS products.”
Juul responded to the Reynolds comments by saying in a statement that “it is disappointing, but not surprising, to see a legacy tobacco company whose core business remains combustible cigarettes — the very product we intend to eliminate by offering adult smokers an alternative — attempting to thwart the category-wide regulation that’s needed.”
“We have taken the strongest actions of anyone in the industry (including removing from retail certain fruit flavors).
“But underage vaping must be addressed through category-wide action from FDA, which we support.”
The Reynolds public comment represents another clash between the maker and Altria Group Inc., maker of top-selling traditional cigarette Marlboro.
Altria and Reynolds hold combined about 85% of the U.S. traditional cigarette market place.
Altria said Dec. 20 that it would spend $12.8 billion to buy 35 percent of Juul, along with end production of its two primary e-cig products MarkTen and Green Smoke.
Juul keeps its independence while gaining access to Altria’s distribution channel, pivotal retail shelf space in more than 230,000 locations, and operational and regulatory expertise.
Gottlieb expressed concerns since the investment was announced about whether Altria and Juul are sincere in their commitment to reducing youth use of tobacco products given the broader reach of Juul in the Altria distribution chain.
Ogden’s response repeats BAT positions that it considers enhanced FDA oversight of tobacco products “not justified or workable.”
In January, a coalition of 18 right-leaning groups appealed to President Donald Trump and two federal agencies to “immediately halt” what it called an “aggressive FDA regulatory assault on businesses who sell and consumers who rely on less harmful alternatives to cigarettes in the United States.”
The coalition is led by conservative heavyweights Grover Norquist, president of Americans for Tax Reform, and Lisa Nelson, chief executive of ALEC Action.
BAT’s stance also covered the very-low-nicotine standards the FDA is pushing to achieve, as well as a proposed ban on menthol traditional cigarettes that Gottlieb had recommended and promoted for several months.
Analysts project it will take years for the FDA to go through the regulatory process to implement the heightened restrictions, and the agency likely will face multiple lawsuits from tobacco manufacturers and anti-smoking groups.
The $54.5 billion that BAT spent to acquire full ownership of Reynolds American in July 2017 always carried one potential drawback — that the FDA would go after menthol traditional cigarettes.
The majority of Reynolds’ estimated 3,000 local employees work in the 2 million-square-foot Tobaccoville plant that includes production of top-selling menthol traditional cigarette Newport and Vuse.
BAT said it “believes the FDA does not have the (congressional) authority to ban a category of product (in traditional markets) ... or reduce nicotine (levels) in tobacco products to zero.”
In speaking to the FDA’s marketing concerns, BAT said it is working with U.S. convenience stores “to ensure that tobacco, mint and menthol, which are our top-selling flavors remain available for (adult) consumers who are looking for potentially less harmful alternatives to cigarettes.”
“We also have plans to make our flavored products available in other age-restricted locations, including in specialist vape stores,” the manufacturer said.
Gottlieb has recommended removing e-cig sales from convenience and discount stores because of what he considers as lax oversight of sales to youth, resulting in most retail e-cig sales at adult-only vape shops.