The vaping industry has many enemies, including anti-tobacco lobbyists, the FDA, Big Tobacco, and perhaps most importantly, Big Pharma. Pharmaceutical companies with names like Johnson & Johnson, Squibb, and GlaxoSmithKline make billions of dollars from the misfortunes of the sick and dying. They make their money from drug sales, predominately, but they dabble in other markets, as well. One of these markets is the highly profitable area of nicotine replacement therapies.
Until vaping hit the scene, stop smoking aids like “the patch” and nicotine gums and lozenges were one of Big Pharma’s most profitable sidelines. But consumers saw these products as somewhat unreliable in helping to overcome smoking, largely due to what scientists call an addiction to oral fixation. Research indicates that smokers are not addicted to the nicotine so much as they are addicted to the act of holding a cigarette in their hands and placing it to their lips on a regular basis. Addiction – regardless of the substance – is largely mental.
Obamacare, Big Pharma, and vaping
When President Obama was trying to pass the Affordable Care Act (ACA), otherwise known as Obamacare, he needed the support of health insurance providers, the medical community, and most importantly, Big Pharma. The pharmaceutical companies hold the purse strings attached to the medications that Americans ingest in massive quantities. If Big Pharma was not willing to temporarily lower their prices, then the ACA has no chance of passing Congress.
So, many political insiders allege that the Obama Administration cut a secret deal with Big Pharma. In exchange for their price lowering, Obama officials would secretly pass the Tobacco Control Act of 2009. It is this single piece of legislation that led to the creation and implementation of the new FDA e-cigarette regulations which now classify all vaping technology and e-liquids as tobacco products.
The FDA deeming regulations and vaping
The FDA deeming regulations will require all vape shops and retailers to undergo the Pre-Market Tobacco Application (PMTA) process previously reserved for Big Tobacco. The application is time-consuming and costs in upwards of $1 million per product. Since most vape shops are owned by small businesses owners rather than major conglomerates, their owners simply cannot afford these uber-expensive fees. As a result, economists predict that as much as 99 percent of all vaping-related businesses will be forced to close their doors by 2018 when the PMTA requirement takes effect.
If this is true, then President Obama may have sacrificed the American vaping industry as a way to get Big Pharma on board for congressional approval of Obamacare. By bankrupting the vaping industry, pharmaceutical companies would see a surge in increased revenues from their nicotine replacement therapies which would more than make up for the lost revenues from the lowered drug prices.
Obama would get his healthcare bill passed, and Big Pharma would regain their stronghold on the smoking cessation products market. Everybody wins, except for American vaping – a fledgling industry with little or no political backing just ripe for the plucking.