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The Grandfather Date – What are FDA's Alternatives?

This article is reprinted with the permission of Vape Magazine. It first appeared in the October 2015 issue.

In my article in the last issue of Vape Magazine, “FDA Regulation of E-Cigarettes – Are You Prepared?”, we explored the requirements that will apply to e-vapor manufacturers if FDA’s proposed “Deeming Regulation” becomes effective.   The proposed regulation would capture e-vapor products that contain or use nicotine derived from tobacco as regulated tobacco products.  Such e-vapor products (including devices and e-liquid) would be subject to the same statutory and regulatory requirements that currently apply to cigarettes, smokeless tobacco and roll-your-own tobacco in a “one-size-fits-all” approach that essentially treats all “tobacco” products the same. 

Premarket Authorization – Need for a New Grandfather Date

The most onerous of these requirements is the premarket authorization process.  This means that new products will first have to be authorized by FDA before they can be sold.  But what is a “new” product?  That depends in large part on the “Grandfather Date” set forth in the statute:  February 15, 2007.  A new tobacco product is any product that was either not commercially marketed in the United States as of February 15, 2007, or modified in any way since that date. 

There are two main premarket pathways set forth in the Tobacco Control Act – the Substantial Equivalence (SE) Report and the Premarket Tobacco Product Application (PMTA).  The less burdensome of the two is the SE Report, which requires demonstrating that a new product is “substantially equivalent” to a product that was on the market as of the February 15, 2007 Grandfather Date.  The SE standard requires showing that any characteristics of the new product that are not identical to the grandfathered predicate product do not raise “different questions of public health”.  Because it does not appear that any e-vapor products were on the market on February 15, 2007, and therefore no “predicate” products available for comparison purposes, submitting an SE Report for a new e-vapor products is not an option. 

Rather, e-vapor companies will have to go through significantly more burdensome PMTA process to market new products.  Although the PMTA does not require a comparison to a predicate product, it is the substantially more difficult (and considerably expensive) pathway because companies must demonstrate that their new products are “appropriate for the protection of the public health” in order to market them.  This is a very high standard that requires considering the product’s risks and benefits to the population as a whole, including users and nonusers of the tobacco product, and taking into account the increased or decreased likelihood that existing users of tobacco products will stop using such products, and the increased or decreased likelihood that those who do not use tobacco products will start using such products.

Requiring all e-vapor products be subject to PMTAs would be likely to, eventually, destroy the industry because it simply would not be a feasible option for thousands of small vaping businesses. Many industry advocates submitted comments to the Deeming Regulation urging FDA to use a new Grandfather Date for e-vapor products to capture the existing market.  FDA’s position, however, as stated in the preamble to the proposed Deeming Regulation is that it does believe it has the legal authority to change the statutory Grandfather Date.  But, history indicates otherwise. 

FDA’s Enforcement Discretion

It is important to realize that because the Tobacco Control Act amended the FDCA, it attached itself to lots of well-established jurisprudence and precedent.  The FDCA has always been interpreted as providing FDA with much rulemaking and enforcement flexibility.  For example, Section 701(a) of the FDCA gives the Agency the authority to promulgate substantive rules that will provide for the “efficient enforcement” of the Act.  Furthermore, the Tobacco Control Act itself states in Section 3 that the purpose of the law is to “provide new and flexible enforcement authority to ensure that there is effective oversight of the tobacco industry’s efforts to develop, introduce, and promote less harmful tobacco products.”  Agency decisions regarding whether or not to take enforcement action and the criteria for making such decisions has also been supported by the courts.   

There are numerous examples of FDA using its rulemaking authority to implement appropriate regulatory solutions other than those anticipated by explicit language in the FDCA.  This is true not only with respect to FDA regulation of foods, drugs and medical devices but also tobacco, where the Agency has made ample use of its enforcement discretion with respect to the currently regulated products.  Even in the Proposed Rule for the Deeming Regulation, the “option 2” to exclude premium cigars from regulation, as well as the 24-month “compliance policy” for submitting PMTAs discussed in my last article, are clear examples of FDA using its enforcement discretion. In short, although FDA has stated that it does not believe it can alter or amend the Grandfather Date from the February 15, 2007 date set in the statute, there appears to be ample legal authority for FDA to do so based on the Agency’s ability to use its enforcement discretion. Whether the Agency is motivated to do so is another question. 

Potential New Grandfather Dates

There are several potential dates that FDA could adopt as the new Grandfather Date for e-vapor products.  To understand which dates might make the most sense, it is important to consider why February 15, 2007, an arbitrary date, was selected in the first place.  That date was simply the date that the House and Senate bills that eventually became the Tobacco Control Act were reintroduced in Congress, after previous versions of the bill had failed to pass.  In fact, even though it was H.R. 1256, introduced on March 3, 2009 in the 111th Congress, that was ultimately signed by the President, we suspect that the original February 15, 2007 date was kept in the legislation, at least in part, because that was the date that put the tobacco industry on official notice not only that it would be subject to FDA’s authority, but how it would be regulated.  

Using this same logic of “first notice,” FDA could use several dates as the new grandfather date for e-vapor products:

  • April 25, 2011 – this is the date that FDA published a letter to e-cigarettes stakeholders on its website that it would not appeal the Sottera Inc. v. FDA, 627 F.3d 891 (D.C. Cir. 2010) decision (which held that e-cigarettes that contain nicotine derived from tobacco and are sold for recreational fall under the meaning of “tobacco product” and are not drug delivery devices), and conceded that such e-cigarettes would be captured under its authority by the Deeming Regulation.  That letter is available here:
  • April 25, 2014 – this is the date that the Notice of Proposed Rulemaking for the Deeming Regulation was published in the Federal Register and made available for public comment, putting the e-vapor industry on official notice that FDA intends to regulate it in the same manner as currently regulated tobacco products. 
  • The Effective Date of the Deeming Regulation (To Be Determined) – the Proposed Deeming Regulation could go through significant changes before it is finalized, so using the effective date of the final version would make the most sense.  In addition, the e-vapor product category is a rapidly evolving, and the technology used in products today is quite different (e.g., variable voltage VTMs) from products that were on the market in 2007, 2011 and even 2014.  Use of the earlier dates would not grandfather the many now standard safety features in today’s advanced e-vapor products  FDA may consider using the effective date of the Deeming Regulation as the new Grandfather Date for these products to ensure that it captures the latest engineering and safety advancements that benefit the public health.

A Legislative Solution?

While we believe that FDA does have the legal authority to use its enforcement discretion to amend or alter the Grandfather Date for e-vapor products, FDA has so far stated that it does not believe it can do so.  As a result, many advocates have been lobbying Congress to change the Tobacco Control Act itself.  In April 2015, Congressman Tom Cole introduced H.R. 2058 into the House of Representatives.  The bill would remove all references to “February 15, 2007” in the Tobacco Control Act and replaces it with “the effective date of the regulation under which a tobacco product is deemed subject to the requirements of” the Tobacco Control Act. Thus, the new Grandfather Date would be tied to the date on which FDA makes the Deeming Regulation effective (which could happen later this year).  As a result, any products that are on the market today would be “grandfathered” and thus exempt from the premarket review requirements (but not the other regulatory requirements like Good Manufacturing Practices, ingredient disclosures, testing requirements, facility registration/inspection, etc.). 

While it may be unlikely that this bill ever becomes law given how difficult it is to get anything controversial through Congress, even more recently, Congressman Robert Aderholt introduced a rider to the 2016 Agricultural Spending Bill in the House Appropriations Committee that, similar to the Cole bill, would prohibit FDA from enforcing the February 15, 2007 Grandfather Date for newly deemed tobacco products and move the grandfather date to the effective date of Final Rule for Deeming Regulation. That bill was approved by the Committee on July 8, 2015, but is still unlikely to become law because of opposition in the Senate and the Obama Administration.  A good discussion of this issue can be found in the Committee Report starting on page 71:

What Next?

If the Grandfather Date is changed to a date other than February 15, 2007, in order to avoid the premarket authorization requirements, e-vapor product manufacturers will need to document evidence that their products were commercially marketed as of the new date. In this regard, FDA has published a Guidance Document which provides examples of the types of dated materials that will be accepted as evidence that a product was commercially marketed on the grandfather date:

  • Dated copies of advertisements;
  • Dated catalog pages;
  • Dated promotional material;
  • Dated trade publications;
  • Dated bills of lading;
  • Dated freight bills;
  • Dated waybills;
  • Dated invoices;
  • Dated purchase orders;
  • Dated customer receipts;
  • Dated manufacturing documents;
  • Dated distributor or retailer inventory lists; or
  • Any other document that you believe demonstrates that the tobacco product was commercially marketed (not exclusively in test markets) in the U.S. as of the grandfather date.

This list of items is not an all-inclusive list, but examples of materials that FDA has accepted as evidence that a product was commercially marketed as of the February 15, 2007 Grandfather Date. 

The key item is the final bullet – “any other document that you believe demonstrates that the tobacco product was commercially marketed” in the U.S. as of the grandfather date. FDA has left the door open here for manufacturers to provide any other documentation that might indicate a particular product was on the market on a certain date.  This might include, for example, purchase documentation from suppliers, agreements with retailers or distributors, test results from analytical laboratories, or correspondence with customers, among other things.  Any dated document that might indicate when the specific product was on the market would be relevant evidence to establish grandfathered status. 

Finally, although it remains to be seen whether FDA will adopt a new Grandfather Date in the final Deeming Regulation, or whether either the Cole or Aderholt bills become law, e-vapor product manufacturers that are developing new products should push to introduce those products into the U.S. market sooner rather than later before the Deeming Regulation becomes effective, just in case the effective date of that rule becomes the new Grandfather Date.