Troutman Sanders tobacco team partner Bryan Haynes was interviewed for a June 21 Vapor Voice Magazine article titled “Dark Vapor.” The article deals with the huge propensity for black-market growth in the vapor industry as the FDA’s deeming regulations force many companies to cease their innovative efforts – or even shut their doors.
“There is a 100 percent potential for growth of the vapor black market under the current deeming rule,” said Haynes, adding that he thinks this is “inevitable.” Haynes goes on to state that “When you create barriers to entry that are essentially impossible to overcome, especially when you are dealing with a popular product, you are unavoidably going to create a black market.” The FDA’s proposed premarket tobacco product application, or PTMA, will entail an expensive process which must be completed for each product, including flavor variations, in order for these products to be legally marketed. Even when the applications have been completed and submitted to the FDA, there is no guarantee that marketing approval will be given.

Currently, kits for creating flavors at-home exist on the market, though the legality of those kits will be examined under the deeming regulations. Depending on if the FDA is able to classify them as “component parts”, it is conceivable that they could fall under the agency’s jurisdiction and be subject to similar levels of scrutiny. Aside from this issue, the concentration of substances such as nicotine that can be purchased by the average consumer is already controlled – a factor which drags the industry another step closer to the black market.

These factors, coupled with the ability of the average vaping enthusiast to obtain the necessary chemicals for creating their own e-juice blends at home, makes the industry ripe for the onset of a thriving black market community.

To view the full report, click here, starting on page 30.

For questions and/or comments, please contact Bryan Haynes, Troutman Sanders tobacco practice partner, at 804.697.1420 or by email.