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Electronic Nicotine Delivery Systems

Electronic Nicotine Delivery Systems (ENDS) is defined as noncombustible tobacco products, which includes devices, components, and/or parts that deliver aerosolized e-liquid when inhaled. Examples include vape pens, personal vaporizers, electronic cigarettes, cigar likes, e-pens, e-hookahs, e-cigars, e-pipes, advanced refillable personal vaporizer, and any component, liquid, part, or accessory of a device without regard to whether the component, liquid, part, or accessory is sold separately from the device.

Vape Industry

The vape or ENDS industry has been growing exponentially for the past 10 years. JUUL company, which manufactures and sells only e-vapor products, was valued at billions of Dollars in 2019. The vape industry market expansion resulted in the cigarette market decline which prompted Atria, the largest cigarettes manufacturer, to start investing in e-vapor products and hence invest in JUUL.

Cannabis Industry

Cannabis refers to a group of three plants with psychoactive properties, known as Cannabis sativa, Cannabis indica, and Cannabis ruderalis. Cannabis is made up of more than 120 components, which are known as cannabinoids. Experts still aren’t sure what each cannabinoid does, but they have a good understanding of two of them, known as cannabidiol (CBD) and tetrahydrocannabinol (THC). Cannabis is federally illegal, but states are starting to make it legal for only recreational and medicinal uses. 

With the legalizing of cannabis in several states, the demand for CBD and THC e-vapor increased. This added to the already booming vapor industry.

FDA Regulations 

In 2019 the FDA started raising alarms about the e-vapor boom especially with teenagers mainly high school and college students. The FDA attempted to slow down the e-vapor market by imposing restrictions on how e-vapor companies market their products, banning flavored nicotine, and adding new rules to Premarket Tobacco Applications (PMTA) review processes. Several manufacturers including JUUL started complying with FDA labeling to avoid any further government regulations. Medical research started raising alarms about the health impact of e-vapor compared to cigarettes.

Flavored Vape Ban

Several states have instituted bans on flavored products and a federal ban may be in the works. The FDA banned most fruit- and mint-flavored nicotine vaping products to curb teen use in January 2021.

Cigarettes Industry

The e-vape industry market expansion caused the cigarette market to decrease, resulting in loss of revenues for the cigarette manufacturers like Altria (Marlboro) and RJ Reynolds (Newport, Camel). Cigarette manufacturers pushed back by using lobbyist and funding coalitions like The Coalition for Fairness in California to keep their market share of menthol cigarettes, flavored smokeless tobacco, and small cigars. 

States Revenues

The decline in cigarette industry due to the vapor boom triggered the states to look for ways to replace cigarette tax revenues. About 29 states now require excise tax on vape products and more states are in the process of imposing vape taxes.