News: FDA Regulations Could Wipe Out Every Cigar Introduced in the Past Eight Years
2 Jun 2015
February 15, 2007 could turn out to be the most important date in the history of the premium cigar industry. Why, you ask? Because every cigar introduced after that date could soon be made illegal by the Food & Drug Administration (FDA).
While the so-called Family Smoking Prevention and Tobacco Control Act (FSPTC)—the bill giving the FDA the power to regulate cigars—didn’t pass until June 2009, the legislation sets February 15, 2007 as the cutoff date for tobacco products to be grandfathered in as exempt from needing FDA approval before being sold or marketed in the United States.
Tobacco products introduced after that date (which comes from the text of the legislation and probably cannot be altered by the FDA, even if the agency wanted to) must receive the FDA’s approval before they can be marketed for sale. For a period from passage of the FSPTC until March 22, 2011, new tobacco products could be marketed while an application was pending but, as the FDA reiterated recently, any new product that didn’t have an application submitted by that date cannot be marketed until the FDA takes action to approve it. This would apply to cigars when they are subject to FDA regulation, despite the fact the FDA hadn’t even taken the first step towards regulating cigars in March 2011, and so no cigar applications would have been submitted.
Theoretically, new cigars should get approved as “substantially equivalent” to products that were already on the market in 2007 since the basic components of handmade cigars haven’t changed in at least a century. But the process is surprisingly complicated, likely very expensive, and includes an “Environmental Assessment” and a “Health Information Summary” along with a requirement for scientific studies about how the product would be used in comparison to the product it is being claimed as substantially equivalent to. In other words, you’d probably need deep pockets, lawyers, and scientists to have a chance.
Plus, so far the FDA hasn’t shown any ability to handle existing applications. As we observed when the Deeming Rule was first proposed, only a few dozen of the 4,000 pending applications were ruled on as of April last year, with just 17 being approved over the period of multiple years. As of now, the FDA site says it has approved only 132 products as “Substantially Equivalent” since 2011, while an untold amount remain waiting for a ruling.
The FDA did propose in its rules one option for an exemption for premium cigars with a retail price of $10 or more, but even if the agency adopts that option it would leave the vast majority of cigars (85%, according to one analysis) to be banished from the market and forced to wait for an approval that may be nearly impossible to get.
February 15, 2007 is a long time ago, so allow me to set the stage: On that date we published a Quick Smoke of the Gispert Lonsdale (remember that cigar?), and you couldn’t yet buy an Apple iPhone because the first one didn’t go on sale until later that summer.
As far as cigars go, here are just a few introduced in 2007, but after the February cutoff date: Oliva Serie V, San Cristobal, Padrón Serie 1926 80 Years, CAO America, Te-Amo World Selection Series, Santa Rosa (an Altadis cigar I forgot ever existed), Rocky Patel Sumatra Edge, Cabaiguan Guapo, La Aurora Corojo Oscuro Barrel Aged, and the Cuban Cohiba Maduro (which, if the embargo ever ends, would also be subject to the regulations).
To say the industry has changed since then would be a gross understatement, as evidenced by the fact that multiple cigars listed above are no longer being made. For most cigar smokers I talk with, the vast majority of cigars they smoke were introduced well after 2007.
Cigar rights groups are now looking to push legislation that would amend the date for new cigars to be grandfathered in. This seems extremely reasonable. After all, how can cigars have complied with a regulation two years before passage of the bill authorizing the FDA to regulate cigars, and five years before the agency took any steps towards exercising its power to regulate cigars?
The problem is that reasonable doesn’t buy you much when it comes to passing federal laws. And considering the difficulty in getting support for the Traditional Cigar Manufacturing and Small Business Jobs Preservation Act in Congress, there isn’t much indication that there are majorities in Congress that want to treat cigars reasonably, nor that President Obama would sign such legislation if it somehow made it to his desk.
–Patrick S
photo credits: Stogie Guys
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Aren’t there two possible exemptions being considered? One to exempt only premium cigars with price tags above $10, and another to exempt all premium handmade cigars? Are there any updated odds available on either possible exemption?
There is no total exemption being proposed by the FDA. In theory the FDA could decide to pull the rule but (maybe because the comments we submitted were so persuasive) but I’d put the odds of that pretty much at zero. The traditional cigar manufacturing preservation act would create an exemption for cigars that meet the definition in the bill which does not include any arbitrary price definition.
People I’ve talked with who have experience with the federal rule making process say the $10 retail definition for the exemption could be tweaked slightly without the need for another comment period, but only slightly. I have no idea what the odds are between option 1 (no exemption) and option 2 ($10 or effectively equivalent exemption) but neither would surprise me much.
I know some people are optimistic about a cigar exemption. I’m afraid I’m not among them. Though I hope I’m wrong. I truly fear what is likely to come. One thing that got little attention at the time the proposal was released was that it was only because of the White House OMB that the FDA cigar proposal isn’t considerably stricter. According to Reuters, OMB deleted numerous portions of the proposal, including one that likely would have banned online sales, as well as sections on FDA projections of lives saved by regulating cigars and health improvements from persuading people not to smoke cigars. I think those things show what the FDA really wants to do. And, as Patrick points out, there appears to be little appetite in Congress for action.
I remain among those who think it is possible the FDA continues to sit on this proposal indefinitely — like it has done for several years with menthol cigarettes — which it has the option to do.
Any regs will be subject to a lawsuit, and the FDA has recognized the potential problem in the 2007 date in regards to cigars and has suggested some alternatives (taken from the FDA proposal’s request for comments):
The statute establishes a “substantial equivalence†(SE) pathway for a new tobacco product to enter the market if it is substantially equivalent to a “predicate product,†meaning a product commercially marketed in the United States as of February 15, 2007.
The FDA is aware of new product category entrants into the market after the February 15, 2007, reference date and that the SE pathway may not be available to these newer products.
Because this date is written into the statute, the FDA does not believe that it has the authority to amend it with respect to e-cigarettes or other products. The FDA is proposing to extend the compliance period for submitting a marketing application under
this pathway to 24 months following the effective date of a final rule. The FDA is also proposing a 24-month compliance period for the submission of premarket tobacco applications.
There is legislation in Congress that would keep cigar regulations out of the hands of the FDA, H.R. 662 & S. 441. One of the surprising hurdles is John Boehner. Apparently he is in bed with one of the mega cigar & tobacco companies whose bottom line wouldn’t be affected that much. In fact, the FDA regs would eliminate much of their competition, giving them an even larger share of the market. For some time now, Boehner has been blocking similar legislation from making it to the floor for a vote. This is just one of many assaults on our liberty. Please be active and take a stand. Call your representatives and your senators and demand that they support H.R. 662 & S. 441. Smoke ’em if you’ve got ’em and always Stand4Liberty.
Regardless of whether Boehner is really blocking this bill, this is not a major issue for many in Congress. And if it got to the president’s desk, he would surely veto it.
I’m not convinced that the president would veto, but you might be right. Does that mean we shouldn’t try? The issue isn’t high on the radar because they aren’t hearing anything from their constituents regarding it. While this piece of legislation is specifically about the cigar industry, it has a much broader appeal. The battle is about liberty vs. tyranny. At this stage, every small shift matters. Every step, as small as it might be toward more government control is a huge leap away from the one thing that sets America apart, Liberty. I would still encourage everyone to be engaged and take a stand. If not this battle, which one? If not us, who?
Very nice summary Patrick – it amazes me how clueless so many people are IN OUR INDUSTRY in regards to even the basics of the FDA legislation – not talking consumers, but people whose livelihood hangs in the balance. Keep up the good work!