November 10, 2016    6 minute read

What E-Cigarettes And Electric Cars Have In Common

A Victim Of Success    November 10, 2016    6 minute read

What E-Cigarettes And Electric Cars Have In Common

The news that NJoy, once one of America’s leading e-cigarette makers, filed for bankruptcy in September underscores the fact that the US e-cigarette industry has gone from burgeoning to flat-lining. Faced with its regulatory pressures and stigma, a decade of steady growth has given way to a stifled market. Regarding the potential detriments to the public’s health, though, the impact of e-cigarettes struggle might go well beyond any company’s bottom line.

The US Vs The UK

The problem is that there are two very different approaches on either side of the Atlantic. In the US, the Food and Drug Association (FDA) focuses exclusively on what some have termed a “quit or die” approach to tobacco, advocating abstinence for smokers and showing scepticism toward the idea of harm reduction (switching from cigarettes to less harmful alternatives, like e-cigarettes). To justify this, the FDA says the science on the health effects of vaping is not in yet and has enacted new regulations that treat e-cigarettes like any other tobacco product.

Adopting the opposite approach, physicians and health authorities in the UK have embraced e-cigarettes as a useful tool for helping smokers. Realising e-cigarettes can help people quit, the NHS actively encourages smokers to make the switch and has approved prescribing e-cigarettes. The UK’s attitude toward the devices is best typified by the Royal College of Physicians, which this past April rejected the idea that e-cigarettes are a gateway to smoking and threw its weight behind them as a tool to quit.

The Strategy Seems To Be Working

The strategy is working: e-cigarettes have overtaken nicotine gum and patches to become the most used smoking cessation products in Britain, with almost three million users and as many as 18,000 people quitting using them in 2015. In the UK, sales of vaping products in 2014 were three times higher than nicotine replacements, totalling £459m. Euromonitor projected sales would hit £1.47bn in 2018.

While British health authorities give e-cigarettes a ringing endorsement, the FDA risks misleading consumers into thinking that vaping is just as bad as cigarettes. According to a report from Georgia State University, this is already happening: the percentage of Americans who believe e-cigarettes are as harmful as cigarettes have risen threefold, from 13% in 2012 to 40% in 2015.

The US is not the only one taking a puritanical approach. The World Health Organization (WHO)’s Framework Convention on Tobacco Control (FCTC) is stridently opposed to e-cigarettes, focusing on abstinence with little thought given to harm reduction. The FCTC has advocated that e-cigarettes be regulated as tobacco products and has gone so far as to suggest an outright ban. At its COP7 meetings, currently being held in New Delhi, the FCTC will in all likelihood stick to this thinking. Of course, e-cigarette makers are not the only critics: by pushing for plain packaging rules and new taxes on tobacco, observers worry the FCTC is pushing current smokers toward illicit cigarettes while undermining intellectual property.

The Shared Fate Of E-Cigarettes And Electric Cars

The drawbacks to the FCTC’s position have been spotlighted with the release of the documentary A Billion Lives, which is harshly critical of the group and argues that tobacco alternatives like e-cigarettes could save millions of lives. Because many national governments take their cues from the WHO and the FCTC in setting policy, their hostility toward e-cigarette products is being felt globally.

As a question of competing industries fighting to change how they (and their competitors) are regulated, the battle over e-cigarettes is reminiscent of how electric cars first emerged two decades ago. Faced with a growing pollution problem, the state of California mandated all automakers begin manufacturing zero-emissions cars, and that such vehicles constitute 10% of new sales by 2003. General Motors released the EV1, the first electric vehicle mass-produced by a major automaker. The EV1 developed a following and promised a new era of clean vehicle technology (and cleaner air).

That dream soon came crashing down. California’s law came under assault as business interests, including the automobile and oil industries, allegedly joined forces to lobby against the emissions standards. In 2002, General Motors, DaimlerChrysler, and several California car dealers challenged the law in federal court with help from the Bush administration. Under pressure, California watered down its regulations, and GM terminated the program, killing the first high hopes for clean automotive technology. GM cited lack of demand as the reason for ending the EV1, but some accuse it of sabotaging its product to protect core business interests. Like the e-cigarette battle, the one over the electric car has its documentary: 2006’s Who Killed the Electric Car?

Some of the same dynamics that ended the electric car can be seen in the debate over e-cigarettes. The EV1, after all, was allegedly killed by businesses threatened by the new technology. As more smokers switch to e-cigarettes, pharmaceutical companies have watched their profit margins for older anti-smoking products go up in… smoke. Quitting is big business, and products like nicotine gum and patches dominated the market until recently. With the popularity of e-cigarettes soaring, sales of traditional smoking cessation products (like gums and patches) seem to have hit a hard ceiling in the UK, totalling just £140m in 2014 and barely moving in the five years prior.

Taking The Fight To Europe

Is the pharmaceutical industry taking a page from the EV1’s downfall by shaping e-cigarette regulations? GlaxoSmithKline, the maker of Nicorette gum, has already been caught planning to lobby the European Union and others for tougher regulations. GSK planned a push for e-cigarettes to be licensed as medical products and for a prohibition on advertising, and there is no question that the FDA and FCTC attitudes toward e-cigarettes are to the tobacco industry’s benefit.

Like the fight over emissions standards and the EV1, the decisions being made now will have major implications. Tens of thousands of smokers in Britain have used e-cigarettes as a way out of lethal addiction, and a growing chorus of voices wants the same to happen worldwide. The question remains whether the US and WHO regulators can be swayed before the e-cigarette industry, like the zero-emissions vehicles of the 1990s, becomes a victim of its success.

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