The following is an update from the National Association of Tobacco Outlets (NATO) sourced through their March 13th online bulletin. Reposted with permission.
Follow Up on FDA Pre-Market Applications
Since the NATO article entitled “The ABCs of FDA Pre-Market Applications” was sent to members earlier this week, several members have responded with questions. Those questions with NATO’s responses are below:
Question: Do cigarettes, smokeless tobacco, or roll-your-own products which were on the market as of February 15, 2007, but subsequently modified, need a pre-market authorization application filed with the FDA?
Answer: Yes, cigarettes, smokeless tobacco, or roll-your-own products which were on the market as of February 15, 2007 and subsequently modified need a pre-market authorization application filed with the FDA.
Question: If a tobacco product does not have a SE or PMTA filed by May 12, 2020 and is therefore “misbranded,” does that mean the product is unlawful to sell?
Answer: Yes, the FDA law states that a misbranded product becomes unlawful to sell and can no longer be on the market.
Question: How do I know if a tobacco product is “grandfathered” and can remain on the market without having a SE or PMTA application filed with the FDA?
Answer: The FDA has a “Grandfathered Tobacco Product” webpage on its website. This page is for those grandfathered tobacco products which manufacturers have voluntarily filed for a grandfather status determination for their products. Click on the link below and scroll down the FDA webpage to “Search Grandfathered Determinations” and then click on “standalone grandfathered submissions” and you can fill in the product and manufacturer name to search those products which have voluntary grandfathered status with the FDA. Please note that the FDA webpage states the grandfathered tobacco product database does not contain a complete list of all grandfathered products because filing for grandfather status is voluntary.
Question: Given the impact that the Corona Virus has had on the country, is there a possibility that the PMTA deadline of May 12, 2020 can be extended?
Answer: The answer to this question is not known at this time. The FDA is under a federal court order which set the PMTA deadline as May 12, 2020. If the FDA were to petition the court for an extension of the May 12, 2020 deadline date, NATO will inform its members.
Question: Is it possible to create a centralized database of all of the products that have applied for PMTA or SE authorization?
Answer: No, NATO has already looked into the possibility of creating a database listing the pre-market applications that the association would have knowledge of as being filed with the FDA. However, there are potential anti-trust issues in doing so since NATO could be seen as giving those manufacturers in the database a competitive advantage over those that did not want their pre-market application information to be published in such a database.
Question: Are there sell-through provisions at retail and wholesale for any products that have not submitted PMTA or SE authorization?
Answer: Neither the Family Smoking Prevention and Tobacco Control Act (the federal law which grants the FDA the authority to regulate tobacco products) nor the U.S. Federal Court decision which set the May 12, 2020 pre-market application filing deadline include a provision allowing a sell-through period at the retail or wholesale level for any tobacco product that does not have a required SE or PMTA filed by May 12, 2020. NATO realizes that this is a concern for the industry, and perhaps the FDA will exercise some flexibility for existing inventory on retail store shelves or in wholesale warehouses, but no such guidance has been provided at this time by the agency.
State Legislative Bill Actions
State tobacco-related legislative bills that have been acted on by a state legislative committee or state legislature are listed below alphabetically by state:
Alaska: Senate Bill 182, which imposes a tax on vapor products at the rate of 75% of the wholesale price, passed the Senate Labor and Commerce Committee as substituted on March 11, 2020.
Arizona: House Bill 2853, which raises the minimum legal sales age to 21 and provides penalties for businesses selling to underage patrons, passed House on March 5, 2020.
Colorado: House Bill 1319, which, as amended, prohibits the sale of all flavored nicotine products in all stores that are not age restricted, passed the House Health and Insurance Committee on March 10, 2020 and will be considered by the House on March 13, 2020. House Bill 1001, which increases the minimum sales age for tobacco products and vapor products from 18 to 21; requires vapor product retailers to obtain a license; and prohibits new tobacco product or vapor product retailers from being located within 500 feet of a school, passed the House and moved to the Senate on March 10, 2020.
Florida: Senate Bill 810, which increases the purchase age for tobacco and vapor products from 18 to 21 years of age and prohibits the delivery sale of tobacco and vapor products, was sent to the Governor on March 11, 2020.
Georgia: House Bill 864, which imposes an excise tax on vapor products at a rate of 7% of the sales price, was favorably reported from Committee on March 5, 2020.
Hawaii: House Bill 2457, which, effective July 1, 2050, bans the sale of flavored tobacco products, passed Senate Committees on Consumer Protection and Health and Education with amendments on March 11, 2020. Senate Bill 2227, which, effective June 18, 2050, includes vapor products in the definition of tobacco products in order to impose the existing 70% of wholesale price tobacco excise tax on them and increases the cost of the annual retail tobacco permit from $20 to $50, passed House Committee on Consumer Protection and Commerce with amendments on March 11, 2020. Senate Bill 2228, which, as amended, effective July 1, 2023, prohibits the sale of flavored electronic cigarette products and includes vapor products in the definition of tobacco products in order to impose the existing 70% of wholesale price tobacco excise tax on them, passed House Committee on Consumer Protection and Commerce with amendments on March 11, 2020.
Indiana: Senate Bill 1, which prohibits a person under age 21 from buying or possessing tobacco, e-liquids or electronic cigarettes; doubles penalties for sales to minors; prohibits a tobacco retailer from being located within 1,000 ft. of a school (current retailers grandfathered); requires a retail establishment with 85% gross sales from tobacco and e-cigarettes be age 21 restricted, had the conference committee report adopted by the House and Senate on March 11, 2020.
Maine: LD2052 (SP725), which prohibits the sale of electronic smoking devices and nicotine liquid and new tobacco products, pending adoption of certain rules, was reported out of the Joint Health and Human Services Committee as “ought not to pass” on March 5, 2020.
Maryland: House Bill 732, which, as amended and beginning on 7/1/20 increases the cigarette tax to $3.00 per pack and the OTP tax rate to 50% (includes electronic smoking devices—taxes open ESDs at 12%)—floor tax; beginning 7/1/21, increases the cigarette tax to $4.00 per pack and the OTP tax rate to 86% (includes electronic smoking devices)—floor tax, passed the House on March 12, 2020. House Bill 3, which, as amended, prohibits the sale of flavored tobacco products and electronic smoking devices (includes menthol, mint and wintergreen), passed second reading in the House on March 12, 2020.
Minnesota: House File 3032, which prohibits the sale or furnishing of flavored products; modifies administrative penalties for selling or furnishing certain devices or products; provides for alternative civil penalties for certain persons under age 21 who sell or distribute flavored products; and provides criminal penalties, passed the House Commerce Committee on March 10, 2020 and was sent to the House General Register.
Mississippi: House Bill 1407, which imposes an excise tax on vapor products of 15% of the manufacturer’s list price, the same as the OTP tax rate, and increases the purchase age for tobacco and vapor products from 18 to 21 years of age, passed the House, and was referred to the Senate on March 11, 2020.
Missouri: Senate Bill 829, which imposes the OTP excise tax rate of 10% of the manufacturer’s invoice price on vapor products, raises the purchase age for tobacco and vapor products from 18 to 21 years of age, and would prohibit vapor use where smoking is already prohibited, received a pass recommendation from Committee on March 12, 2020.
New Hampshire: House Bill 1410, which prohibits flavors from being added to e-liquids or other vaping products for any person under age 21; prohibits flavors other than menthol and tobacco for cartridges used in e-cigarettes and other vaping devices for all persons (exempts refillable tanks), was amended and passed the House on March 11, 2020. House Bill 1662, which increases the age for sales and possession of tobacco products and e-cigarettes to age 20 in 2021 and age 21 in 2022, is scheduled for an Executive Session on March 18, 2020. House Bill 1624, which establishes a moratorium on the sale of e-cigarettes, failed to pass the House on March 11, 2020. House Bill 1699, which imposes a tax on electronic cigarettes at 40% of the wholesale price, passed the House on March 5, 2020.
New Jersey: The Governor’s budget, which includes a cigarette tax increase of $1.65 per pack, was taken up by the Senate Budget and Appropriations Committee on March 10, 2020. Senate Bill 514, which prohibits the sale of menthol cigarettes, will be heard in the Senate Health, Human Services and Senior Citizens Committee on March 16, 2020. Senate Bill 1262, which revises the requirements for the sale of tobacco and vapor products; increases penalties for prohibited sales; increases fee for cigarette and vapor business licensure; prohibits the sale of vaping liquid with a nicotine content greater than two percent, will be heard in the Senate Health, Human Services and Senior Citizens Committee on March 16, 2020.
Oregon: Senate Bill 1577, which would have prohibited the sale of all flavored vapor products, which was amended on February 18, 2020 and now requires the Department of Revenue to license qualified retailers of tobacco products and inhalant delivery systems, failed to due to adjournment. The provisions regarding the banning of flavored vapor products were removed from the amended version of the bill.
Tennessee: Senate Bill 2202 (same as HB2269), which prohibits the sale of tobacco products, vaping products or smoking paraphernalia to persons under age twenty-one, passed the Senate on March 9, 2020.
Utah: House Bill 23, which. as amended, effective July 1, 2020, requires retail tobacco specialty businesses to electronically verify proof of age for anyone entering the premises and prohibit those under 21 and unaccompanied by a parent or guardian from entering those businesses, prohibits such a business from locating within 1000 feet of a community college beginning August 15, 2020, restricts flavored electronic cigarette products to retail tobacco specialty businesses and preempts local ordinances on minimum legal sales age, flavors, placement or display, and purchase and possession of tobacco products, passed Senate with amendments on March 11, 2020. House Bill 118, which, as amended, would have amended the regulation of retail tobacco specialty businesses by including in that regulation businesses that sell flavored electronic cigarette products; requiring tobacco retailers, for each sale of tobacco products, to provide to the customer, and keep a record of, the name of the product sold, the amount charged, and the time and date of the sale; removing the state preemption of local ordinances regarding tobacco sales and the sales of flavored electronic cigarettes; and prohibiting certain discounts and giveaways of tobacco products, failed in Senate Business and Labor Committee on March 9, 2020. House Bill 375, which would have prohibited the manufacture, distribution, sale, possession or use of any electronic cigarette, (exempting 18-20 year-old military members and their spouses) died by rule on March 9, 2020. Senate Bill 199, which would have enacted a tax of $0.61 per milliliter on electronic cigarette substances and restricted delivery sales of electronic cigarette substances, died by rule on March 9, 2020.
Washington: Senate Bill 6254, which as amended, imposes a new excise tax of 5% on flavored vapor products; bans all disposable flavored vapor products (exempts tobacco and menthol flavors); prohibits online sales of vapor products; requires age restricted stores to verify the age of an individual at the point of entry; and bans the sale of vapor products containing Vitamin E Acetate, passed the Senate on March 12, 2020.
Wisconsin: Senate Bill 364, which raises the age to purchase tobacco products to 21, was considered in a public hearing in the Senate Health and Human Services Committee on March 11, 2020.
Wyoming: House Bill 73, which imposes a tax on vapor products at the rate of 15% of the wholesale purchase price, signed by the Governor on March 10, 2020. Senate Bill 50, which increases the legal age to purchase, possess, and use nicotine products to 21 years of age, moved to the Governor’s desk on March 11, 2020.