Eu restrains e-cigarettes — analyst blog — nasdaq.com

The tobacco industry in Europe received another blow as the Presidency of the Council of the European Union (EU) and the Members of European parliament reached a settlement on draft legislation which could curb the growth of e cigarettes industry.

After months of negotiations Council of EU and the European parliament, both sides agreed yesterday that the e cigarettes, with nicotine strength of more than 20 milligrams per milliliter, would need authorization as a medicine if they can be proven to have some form of curative or preventive action. E cigarettes below this level will face the same regulations as conventional tobacco products if they cant be proved as a medicinal product.

The Council of EU and the health ministers have long been demanding nationwide ban on e cigarettes. However, the European parliament, under pressure from tobacco biggies, held that e cigarettes helped in curbing tobacco smoking and deserved a lighter regulatory touch. The current decision follows hard fought negotiations between the EU governments and the European legislators.

E cigarettes are becoming increasingly popular especially among youngsters. These battery powered devices turn a nicotine based liquid into vapor. They were considered less harmful than tobacco products and therefore the major tobacco players capitalized on them.

Altria Company ‘s ( MO ) subsidiary, Nu Mark LLC, introduced its first e cigarette brand MarkTen e cigarettes in Indiana in August. Reynolds American Inc. ‘s ( RAI ) subsidiary, R.J. Reynolds Vapor Company, is expanding the distribution network of its tailor made e cigarette Vuse. Lorillard Inc . ( LO ) captured a leading position in the electronic cigarette industry in the U.S. after it acquired e cigarette brand Blu e Cigs in Apr 2012. Also, in November, Philip Morris International ( PM ) announced its plans to foray into the e cigarette business.

The parliament also drafted a new legislation on tobacco products. The new regulations on packaging and warnings, stay unaltered. In October, the parliament accepted the legislation drafted by the EU health ministers that requires the tobacco companies to include both pictorial and text alerts on the cigarette packs to dissuade smokers.

Moreover, the law requires the warning to cover more than 65% of both the front and back covers of the packs. As part of the plan to ban the sale of cigarettes and roll your own tobacco with characterizing flavors, it has been decided that menthol cigarettes will be banned totally by 2020.

We now await the Food and Drug Administration’s (FDA) decision on the e cigarette. The anti smoking activists have requested the FDA to impose restrictions on e cigarettes. The FDA has passed a rule compelling tobacco companies to print thought provoking images on cigarette packs inducing smokers to refrain from smoking. Also, the governments of Australia and New Zealand have made plain packaging mandatory for cigarette packs.

LORILLARD CO (LO) Free Stock Analysis Report

ALTRIA GROUP (MO) Free Stock Analysis Report

PHILIP MORRIS (PM) Free Stock Analysis Report

REYNOLDS AMER (RAI) Free Stock Analysis Report

To read this article on click here.

Zacks Investment Research

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.

This article appears in Investing , Business , Stocks
Referenced Stocks EU , LO , MO , PM , RAI

[press release] public health must be at the heart of the eu regulation of e-cigarettes — european public health alliance

As currently evidence on the health impacts of NCPs such as e cigarettes is lacking, we urge the Trialogue to adopt the precautionary principle to shape regulation of NCPs. «Without a robust regulatory framework in place in the EU, e cigarettes are now hanging in a legal limbo. It is essential that this emerging range of products is urgently regulated to safeguard people’s health«, said Monika Kosinska, Secretary General of the European Public Health Alliance (EPHA) «To achieve this, Brussels has to make sure that strict rules on advertising and sponsorship as well as market surveillance and monitoring are the corner stones of new legislation, whilst ensuring that the products are accessible to existing smokers«.

As the EPHA briefing states, lack of strict regulation of NCPs, or maintaining long transitional periods which is equivalent to maintaining the status quo, has the potential danger to drive market developments that are detrimental to public health.

Although high quality NCPs have the potential to help smokers who are not otherwise ready or able to quit smoking, NCPs must not become a gateway to cigarettes, especially for young people, and must not re normalise smoking. The future legal framework must ensure that accessibility to NCPs for existing smokers (4) is not hindered while ensuring that they are unappealing and inaccessible to minors.

«Strict marketing limits similar to tobacco and medicine marketing rules are essential so that NCPs do not promote smoking behaviour either in a direct or indirect way, and appropriate measures put in place to allow a regulatory response to the future and fast development of this market «, said Cornel Radu Loghin of the European Network for Smoking and Tobacco Prevention (ENSP).

«We have long argued for harm reduction in tobacco policy and for radical reform of nicotine regulation to enable effective alternative nicotine products to replace smoking. Regulation is needed to ensure appropriate standards of quality and safety, and to protect against market abuse arising from unscrupulous commercial interests. We therefore support proportionate regulation that enables smokers to access affordable nicotine replacement products as easily as possible while ensuring purity, safety and responsible marketing,» stressed Professor John Britton CBE, Royal College of Physicans (RCP).

Given the relative short market presence of some NCPs, in particular e cigarettes, regulation on NCPs will be based on incomplete evidence on the long term health consequences of their use. «Appropriate monitoring and impact assessment mechanisms, including surveys and data on the health risks, benefits and unintended consequences of the use of NCPs, should be an essential part of the EU regulation on these products,» stressed Deborah Arnott of Action on Smoking and Health (ASH). «The Commission must be empowered to adopt new legislation in order to maintain a high level of human health protection in this fast changing field» concluded Luk Joossens of the Association of European Cancer Leagues (ECL).

Notes to editors

(1) The future legislation of nicotine containing products (NCPs), including e cigarettes, is part of the ongoing discussion on the revision of Tobacco Products Directive (TPD).

(2) EPHA Briefing Regulation of Nicotine Containing Products (NCPs) including electronic cigarettes

(3) A briefing from Action on Smoking and Health (ASH) on electronic cigarettes is available here. Further information on the use electronic cigarettes in the UK is available here

(4) The provision of information in including tobacco cessation services (quit lines) are crucial to sustained and successful efforts to quit smoking

Contact information

Javier Delgado Rivera, EPHA Communications Coordinator at javier or 32(0) 2 233 3876 (mobile 32(0) 484 919 156)