September 03, 2019 7 min read

NZ Regulations are coming, what should we expect?

Big tobacco’s ‘non profit’ groups and special interests are proceeding with their assault on the vape industry in the USA. The FDA has accelerated their timeframe for vape products to apply for PMTA which could mean the end of smaller vape vendors. With regulations soon to be announced in New Zealand we look at what indications the Government has made to date and compare two major regulatory regimes that other western countries are pursuing. We believe there is a risk that the NZ government will over regulate our industry and this could kill off many of the smaller juice makers in New Zealand.

PMTA shows Big Tobacco’s influence in the USA, will the New Zealand Government do the same?

Big developments in the USA vape market are underway; a Maryland district court judge recently released a judgement that accelerated the timeline requiring US vape companies to apply for PMTA (pre-market tobacco approval) from the FDA.  Vape companies had been working with a timeline of late 2021 for PMTA submission, Judge Grimm (appropriately named) has rushed that forward to 10 months from May 2019 with a further 12-month grace period until products without PMTA need to be removed from shelves.

Unfortunately, we can’t lay the blame directly with Judge Grimm or the FDA for the new PMTA regime, the response is no doubt directly related to the American Pediatric Associations lawsuit alleging that the FDA was to blame for the burgeoning ‘youth epidemic of teen vaping’ in the USA.

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What the hell is PMTA?

PMTA stands for Pre-market Tobacco Approval that requires potential vendors to make an application that must be reviewed and approved by the Food and Drug Administration before a new tobacco product can be legally marketed in the United States.

This means that vape companies must undertake costly research to demonstrate to the agency that the marketing of the new tobacco product would be appropriate for the protection of public health. The FDA has to take into account the risks and benefits to the population as a whole, including users and non-users of the products. The FDA is also mandated to consider the likely impact of the products on people’s behaviour, particularly the likelihood that those who do not currently use tobacco products will be attracted to start using the product.

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The PMTA also requires the submitter to include the products components/ingredients, and any health risks associated with the components. As well as product manufacturing specifications and clearly outline the packaging and labeling that the product will be sold in. Whilst this all sounds routine information the devil is in the detail.

The accompanying guidance document issued by the FDA comes in at an eye watering 55 pages long, it is by design arduous and jargon filled, some argue you need a scientist to interpret the guidance document let alone have a scientist prepare your own PMTA application. The FDA’s early estimates were that PMTA would cost $117,000 to $400,000 per product and that approval would be required for each product, not for each flavour, which means that every new nicotine strength you have for the same flavour would count as a new product.

For a simple 5 flavour range with 3 nicotine levels you would be looking at a staggering $1.7 million US dollars for your PMTA and there is no guarantee that your application would even be approved!

Costs SKYROCKET in the USA with PMTA

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These rules require excessive detail for each individual product and is effectively wasting money on unnecessary research into countless products that are nearly identical. There is a narrow range of vape product categories. An alternative regulatory approach is to focus research at a product category level for vaping products on the market. This is because all vaping liquids have the same ingredients with variations essentially limited to flavouring compounds.

Individual products should have their composition identified so common flavouring compounds can be identified and studied for long term effects. This can be achieved with a toxicological risk assessment of each product, making data available for any high risk compounds to be identified. This data can be used for further meaningful research into the harm reduction benefits of vaping.

The action by the FDA is a classic example of special interest groups flexing their muscles in the states. This is blatantly apparent from the FDA records showing the number of PMTA applications already submitted. Of the 475 PMTA applications submitted to date 98% were declines, most interestingly, the 4 products that were approved are all heat not burn (HNB) products from Big Tobacco companies. A clear sign that big tobacco has found a way to protect their profits at the expense of the wider vape industry and ultimately vape users – the ex-smokers that have been harmed by Big Tobacco for decades!

Tobacco APPROVED vs Vaping DECLINED!

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What the hell is TPD?

TPD, which stands for Tobacco Products Directive, is the EU regulation that governs the manufacture, presentation and sale of all tobacco and tobacco related products in Europe. It came into force over 2014 – 2016 and mandates things like Packaging (eg warnings like ‘Tobacco smoke contains over 70 substances known to cause cancer’ must cover 65% of visible packaging etc.) and emissions (no more than 10mg of tar, 1mg of nicotine and 10mg of carbon monoxide per cigarette etc.).

Unfortunately, the EU considers electronic cigarettes to be a tobacco product despite containing no tobacco…what?

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As the TPD relates to Vaping:

Notification:

All new products must be notified to the local authority at least 6 months before sale on market. Notification includes: name of manufacturer, list of ingredients, toxicological emissions report data, nicotine concentration, a description of the production process and declaration that this process conforms to the TPD, supplier declaration to bear full responsibility for quality and safety of product.

Manufacturing:

Nicotine containing E-Liquid bottles must be child and tamper proof and cannot exceed 10mL volume, while cartridges and tanks cannot exceed 2mL. The product composition is subject to certain requirements: Nicotine containing E-Liquids are limited to a maximum of 20mg/mL and cannot contain vitamins, caffeine, taurine, colours or anything with a similar effect. Ingredients, other than nicotine, must be of high purity and exhibit no human health risk in liquid or heated form.

 

Manufacturers must submit annually comprehensive market data, including sales volumes, by brand name and type of the product. Modes of sale and consumer preferences by demographics. All such non-trade sensitive information must be made publicly available. In the event it is believed that a product is not safe or not of good quality or otherwise not in conformity with TPD then the supplier must immediately withdraw/recall the product from the market or otherwise bring the product into conformity with TPD.

With TPD coming into force many European E-Liquid manufacturers upgraded their practices and procedures to improve their ability to meet the high purity requirement and limit the risk of contamination of their juice production. The best way to reduce the risk of contaminants is to introduce controlled cleanroom manufacturing. Operating in a cleanroom environment gives the operator the opportunity to improve the working practices and standards, in addition to providing air management and filtration.

Presentation and Sale:

E-Liquids must be sold with a leaflet listing usage and health information. All products must clearly state all ingredients in descending order of weight and include specific nicotine content along with estimated delivery per dose. Labels must also include the batch number and include the health warning: ‘This product contains nicotine which is a highly addictive substance’. Virtually all promotion of the product is prohibited, including a ban on all print media advertising, radio, sponsorship and audio-visual communications.

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TPD vs PMTA

You can compare the heavy handed PMTA approach with European Tobacco Product Directive (TPD). The difference between the USA – with special interest influence – and the more reasonable approach by the EU is plain as day. TPD comes with its own flaws (eg, bottle size and nicotine strength), but it sets a more reasonable approach with requirement for testing, manufacturing, and labelling.

NZ Regulations: current state of play

The slow gears of the New Zealand regulatory process are nearing the final stages. After many years and successive governments, Associate Heath Minister Jenny Salesa has indicated that proposed Amendments to the SFEA (Smokefree Environments Act) are due to be announced this September (or there abouts).

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In developing the legislation, the Ministry of Health has held a series of meetings with the Technical Expert Advisory Group which is made up of various experts from industry, the health sector and other technical experts. Minutes of the meetings can be found here.

Summary of takeaways from the minutes:

  • The government recognises the public health benefit from supporting vaping

  • A light touch regulation approach was discussed

  • The government will release a standard for manufacturing and testing covering ingredient validation, personnel, cleanliness and premises.

  • Labelling requirements

The government has made indications that the provisions of the SFEA amendment will give the government the following:

  • Provisions for limiting flavours

  • Provision for limiting nicotine strengths

  • Possible emissions testing

  • Likely restrictions on advertising

Current thinking is that this will mean a ban on certain flavours and overly conservative limits on nicotine strengths which would have serious impacts on the industry and ultimately the prevalence of vaping and its enormous associated public health benefit. However, our understanding from the available information is that the SFEA amendments will give the government the ability to restrict flavours and strengths in the future rather than starting out with this. So these risks are still present but may be delayed or possibly never implemented at all.

5,000 Kiwis die every year from smoking! That means there we 13 preventable deaths today.

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Could NZ follow in the footsteps of heavy-handed regulations in Europe or the USA?

It looks like NZ government is more aware of the health benefits to the biggest public health crisis over the last century. We expect regulations to be less onerous than other regulatory environments but there is always the possibility that local politicians will copy off shore regulations to avoid doing the leg work required to come up with a good system. Stay tuned to our site for updates as the regulations are announced and we will publish our submissions as we make them.

As an existing manufacturer, Lion Labs believes in high quality production premises and strict operational procedures to ensure product safety and quality. We have self-regulated our operation to world class standards already and are prepared for regulations.

 

Article created by: https://www.lionlabs.co.nz/blog/2019/8/29/impending-regulations-what-will-nz-govt-do


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