Regulatory developments in the Electronic Nicotine Delivery Systems (ENDS) sector appear to be in a period of hesitation in one of the world’s largest markets, the US. However, don’t be mistaken to think this means significant challenges and opportunities don’t lie ahead. In fact, this pause may determine the entire future direction of the sector.
This article outlines what developments are expected over the next 12 months and how they might determine the future of large and small ENDS businesses.
The latest on PMTAs in the US
Following the Pre Market Tobacco Product Application (PMTA) deadline in September 2020, ENDS companies were expecting a flurry of product authorizations to be granted 12 months later, towards the end of 2021. So far, only one product has received authorization – a tobacco-flavored e-cigarette.
What we have seen, however, is a significant number of Marketing Denial Orders (MDOs), resulting in the products being immediately taken off the market. In most cases, these have been due to PMTA submissions containing insufficient evidence that the flavored e-liquid products concerned offer additional benefits over tobacco-flavored alternatives.
Smaller manufacturers have been affected most significantly, whilst the larger leading ENDS companies and top five tobacco companies wait patiently for any outcomes.
What is expected in 2022?
Possibly more of the same.
Few of those waiting on pending applications are likely to feel confident enough to pressure the Food and Drug Administration (FDA) to deliver outcomes.
Any push for progress we see is more likely to come in the form of political and societal pressure from the likes of the American Academy of Pediatrics and the Campaign for Tobacco-Free Kids.
In terms of what FDA’s focus is likely to be on in 2022, they’re sure to continue prioritizing scrutiny of products deemed more likely to appeal to youth. Hence, it’s likely they’ll now turn their attention to Pod Mod systems, having previously focused on Pods and e-liquids.
What opportunities lie ahead?
A significant opportunity might be available for smaller ENDS manufacturers who may have been affected by recent MDOs to capture future market share, by developing products using synthetic nicotine.
Synthetic nicotine is currently unregulated because PMTA only applies to nicotine derived from tobacco. This loophole will likely close within the next 12-18 months, with FDA needing to make a decision on how synthetic nicotine should be regulated. Meanwhile, ENDS companies have the option to develop a synthetic product now to:
- Market the product for immediate short-term commercial gain.
- Market the product to obtain real-life data for a PMTA for a tobacco-derived nicotine product
- Start the PMTA process for a synthetic nicotine product and be one of the first approved on the market when regulation catches up.
Whichever option is chosen, applying a long-term vision in this way could result in billion-dollar shares in the market, post authorization.
However, one word of caution. Regulators may decide to regulate such products through the more onerous and long-term medicinal pathways in the future. In that case, it’s likely to shut down that option entirely.
What challenges do we face?
Indecision can sometimes become decision by default. The major risk for ENDS companies is that delays by FDA fuel misinformation and reduce smokers' appetite to want to use these alternatives to quit.
Regulators in the US and China need to quickly take note of the sensible approach applied by health bodies in the UK that embrace next-generation alternatives as the solution, not the problem.
Their indecision in the US makes me nervous. ENDS companies that have invested millions into PMTAs are keen to see a return on their investment, and rightly so. This stalemate is likely to reduce the appetite to innovate in the market and reduce the commercial attractiveness of the product sector.
Ultimately, ENDS need to remain available on the market. Not for the manufacturers. Not for the sake of capitalism. For the sake of smokers. They are a great alternative to support tobacco harm reduction, and strong science supports them.
The time is now
One thing is clear. Recent MDOs have shown that despite many perceived changes in the regulatory goalposts over recent years, FDA are serious about ensuring products available on the US market are appropriate for the protection of public health.
ENDS companies that are prepared to embrace this opportunity and work to the required standard will survive and thrive. Others will not.
As a sector, we must work together to ensure 2022 is the year that positive steps are made to change the perception and regulatory acceptance of ENDS products to protect the industry's future and public health.
To identify your next steps, contact us to book a meeting with our regulatory services team, so that we can help you advance a smoke-free future. If you’d like to learn more about regulatory pathways and how they create new business opportunities for forward-looking companies then read our recent Regulatory Digest below:
Can we help you?
Broughton have deep CRO capabilities and an experienced team of scientific and regulatory professionals to manage full service global regulatory projects. Our knowledge of global regulatory pathways offers significant insights that can be incorporated into your project plans. Our mission is to accelerate safer nicotine-delivery products to market; creating a smoke-free future.
Book a meeting with us today to discuss your requirements.