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Clouds on the Horizon for Vaping Industry

Anticipated FDA rules likely to require expensive approval process for all vape products, leading to possible “vapocalypse.”
July 8, 2015

​NEW YORK – The Wall Street Journal took a look this week at the possible ramifications for the burgeoning – and profitable – vapor business, when the FDA unveils new regulations for e-cigarette products.

According to the WSJ, within the next two months, the FDA is expected to complete rules that would require federal approval for nearly all flavored liquid nicotine juices and e-cigarette devices. Regulatory consultant SciLucent estimates that the product approval process under the new rules could cost anywhere from $2 million to $10 million for each item being regulated.

And according to a trade group representing vapor shop and vapor manufacturers, the Smoke-Free Alternatives Trade Association, 99% of the industry will go out of business once new FDA rules are enforced. One industry executive refers this scenario as “vapocalypse.”

Last year, the FDA proposed rules that would require e-cigarettes, including liquid nicotine and devices, to be approved by the agency. That would be a challenge, e-cigarette manufacturers say, because the FDA has never approved a new tobacco product. Companies would have six months after the FDA completes its rules to register products and ingredients with the agency, and two years to complete the process of seeking approval.

According to the news report, the strict new regulations are expected to cut the supply of liquid nicotine, driving up costs for shop owners and in turn, consumers. The recent, unregulated explosion in e-cigarette use has led to the creation of numerous small, start-up brands, which are most likely to feel the effects of regulation. In comparison, e-cigarette brands backed by large tobacco companies will be better able to afford the expected approval process.

However, not everyone in the vapor industry opposes increased federal regulation. The WSJ spoke with one vape shop owner who felt some relief that new regulations would take the pressure off of him when it comes to ensuring that the liquid nicotine he sells comes from manufacturers blending in controlled environments and conducting proper chemical analysis.