BAT shoehorns its nicotine pouches onto the Canadian market

On Tuesday this week, Health Canada made public its decision to issue a natural health food license to a subsidiary of British American Tobacco. As a result, British American Tobacco has become the first manufacturer to be authorized to market nicotine pouches in Canada.

This federal license, issued on July 18, 2023, allows BAT/Nicoventures authority to market five flavours of a 4mg nicotine pouch. It also allows the company to advertise these pouches as a way to quit smoking ("help you quit smoking by delivering nicotine to your body, temporarily relieving cravings and nicotine withdrawal symptoms") and a way for smokers to cope where smoking is banned ("used when you need to temporarily refrain from smoking, for example, around others, in smoke-free areas, airplanes, or in other situations when you wish to avoid smoking.") It permits the pouches to be sold to children (although it advises people under 18 not to use it). 

This post highlights how this development reveals vulnerabilities in Canada's health regulatory approach, and how BAT has been able to use regulatory pathways intended for health products as a route to market for its addictive consumer products. Although Health Canada has adopted a harm reduction approach to tobacco, it has failed to established a legal framework for this strategy or to be transparent about how nicotine pouches fit into this strategy. Whatever benefits nicotine pouches might offer for public health, allowing British American Tobacco free rein on advertising them is unlikely to achieve a public benefit.

Summary

Canadian law does not currently allow for the sale of nicotine pouches, other than as regulated medicines. Over the past five years, BAT and other tobacco companies have launched "modern oral" products as a way to expand their range of nicotine products to overcome reduced cigarette use. Their nicotine pouch is sold under the brand name VELO and is currently available in at least 22 countries.  BAT is hoping to expand the market for modern oral tobacco beyond the Nordic countries, including in North America. 

BAT can use its ownership of NRT companies to gain access to therapeutic channels to sell nicotine. BAT acquired Niconovum, which pioneered nicotine pouches for sale as a form of NRT, branded as ZONNIC. Scandinavian countries have authorized ZONNIC as NRT. However, the product authorization issued by Health Canada shows that the ingredients and flavourings in the Scandinavian ZONNIC are different from the product that BAT will sell in Canada. Based on the ingredient list and flavourings, the product approved by Health Canada this week is almost certainly the 4 mg version of their VELO nicotine pouch.

BAT will face very few restrictions on how it can market ZONNIC nicotine pouches in Canada, other than with respect to how it represents the therapeutic benefits of the product. Under federal law, advertisements will be allowed in all media, and there are no restrictions on the use of lifestyle imagery. Based on historical marketing practices of BAT, we can expect that the product and promotional material will be available in convenience store outlets in most provinces. Provincial governments have the authority to set restrictions on where the product can be sold and how it can be promoted, but few have such measures currently in place.

Other companies are positioned to start selling nicotine pouches in Canada, and the approval of BAT's application may facilitate their doing so. This development raises questions about the adequacy of Canadian law to protect the public from the marketing strategies of tobacco companies, about Canada's application of Article 5.3 of the Framework Convention on Tobacco Control, and about the need for an integrated nicotine strategy.

Canadian law does not currently allow for the sale of nicotine pouches, other than as regulated medicines. 

Three federal regulatory systems are in place which control the sale of nicotine products:

1. By default, nicotine is a prescription drug

Under the Food and Drugs Act, Health Canada establishes which drugs are only available by prescription. Nicotine is currently included on this list, which means nicotine-bearing products can only be sold under prescription unless they are specifically exempted under other laws or regulations. The two current exemptions are tobacco and vaping products (which are exempted in the legislation) and NRT (which is exempted in the Prescription Drug List). The Prescription Drug List is set by Health Canada at an administrative level.

2. NRT is regulated as a Natural Health Product

Certain NRT delivery-systems qualify as natural health products and are regulated under the Natural Health Products Regulations. These include gums, patches, lozenges and NRT in "a form to be administered into the oral cavity by means of a non-active device (one that operates on energy generated by the human body or by gravity)." The maximum allowable nicotine per dose is 4 mg, except for patches which can deliver 22 mg per day. These criteria can be changed by Health Canada.

Manufacturers may not sell NRT products unless they receive authorization from Health Canada. Authorization is given for each product and is contingent on Health Canada being provided with evidence to support safety and efficacy as well as support for health claims. Those products which are authorized are given a Natural Product Number (NPN) which is linked with a specific recommended use and specific risk information and contra-indications. (The NPN for Zonnic pouches is 80125630).

If nicotine were not plant-derived, NRT products would be regulated as non-prescription drug.

3. Nicotine in Tobacco and Vaping Products is regulated as a recreational drug

When nicotine is contained in tobacco or a vaping product, it is regulated under the Tobacco and Vaping Products Act. Products which meet the definitions of this act are exempt from the controls in the Food and Drugs Act, and do not need pre-approval to be marketed. There are many restrictions on how tobacco and vaping products can be promoted and packaged.  

 Under this set of laws, the only regulatory path open to BAT to legally market nicotine pouches in Canada is as a natural health product. They are, however, restricted to selling products that contain no more than 4 mg of nicotine per dose.

Over the past five years, BAT and other tobacco companies have launched "modern oral" products as a way to expand their range of nicotine products to overcome reduced cigarette use.

BAT and other tobacco companies have responded to the gradual reduction in smoking in ways which seek to increase profitability (so profits stay high while volume sales go down), which seek to expand their range of nicotine products (so they retain customers who would use nicotine but who might not smoke cigarettes). They are also expand their operations into other pharmacological substances (using their expertise with drug delivery systems to build a non-nicotine revenue stream). 

Four years ago, BAT identified nicotine pouches as "an exciting new space", and began to manufacture "modern oral" products by extracting nicotine from tobacco plants and then blending it with bleached tree fiber (cellulose) and flavourings. In addition to giving the impression of being less risky, these nicotine products had the advantage of not being subject to tobacco taxes. (Taxes on a tin of oral tobacco in Canada are about $20). 

BAT's nicotine pouch is sold under the brand name VELO and is currently available in at least 22 countries. 

Originally called EPOK, LYFT and VELO, BAT h as now branded its nicotine pouches under the VELO trademark.

Over the past 4 years, BAT has expanded its marketing of VELO nicotine pouches to 22 countries (17 of which are in Europe). Typically, these are sold in a dozen or more flavours, and in strengths ranging from 4 mg to 17 mg of nicotine per pouch.

BAT Instagram promotions for VELO

BAT is hoping to expand the market for modern oral tobacco beyond the Nordic countries, including in North America. 

BAT initially focused different alternative-nicotine products in different parts of the world: In Europe and North America, its emphasis has mostly been on vaping products. In the Nordic countries, where snus use was established, it has focused on modern oral. In Japan it has focused on heated tobacco products (its i-glo heated tobacco product was sold for a brief time in Canada). In Central and Eastern Europe the company has been equally focused on heated tobacco and vaping market.  (BAT, slide 33)

This year it has been reported that in response to additional restrictions on vaping products, BAT and other tobacco companies have increased efforts to include nicotine pouches in their product offerings. Even in countries without an oral tobacco tradition (such as the United Kingdom and Europe), BAT is promoting VELO using lifestyle imagery and messages  about as an alternative reduced-risk product. 

BAT and other tobacco companies have bought out independent companies which made nicotine replacement therapies. 

Tobacco investments in NRT products include BAT's 2010 acquisition of  marketing rights for VOKE (a nicotine inhaler), Philip Morris International's 2021 purchase of Fertin Pharma, and the 2023 acquisition by Imperial Brands of the start-up Canadian nicotine-pouch manufacturer TJP .

Preceding these purchases was the 2009 purchase by Reynolds American (RAI) of the Swedish company Niconovum, which developed the ZONNIC brand nicotine pouches and other NRTs. For a time, RAI sold ZONNIC-brand gum in the United States through convenience channels, and was the first tobacco company to be authorized by the FDA to sell stop-smoking medication.  When BAT purchased Reynolds American in 2017, it also acquired Niconovum. In 2019, ZONNIC gum was withdrawn from the U.S. market. 

Although BAT owns Niconovum, it is using a different subsidiary, Nicoventures, to sell ZONNIC in Canada. Nicoventures is the branch of BAT that is responsible for selling VUSE vaping products. Nicotine pouches will not be sold in Canada by a pharmaceutical branch of a multinational conglomerate, but by a company that has a mission to increase nicotine use. 

Scandinavian countries have permitted the use of mint-flavoured 4 mg nicotine pouches as a form of NR, and BAT acquired the company which pioneered that form of  NRT. 

Although Many governments permit the sale of nicotine pouches, in only a few are they sold with medical claims or as a form of NRT. 

Niconovum reports that Zonnic pouches are currently sold as NRT in the Nordic countries of Sweden, Norway, Finland and Iceland. In these countries it is available in only one flavour (Mint) 

The pouch was approved for sale by the Swedish drug authority in 2012 , and an assessment record for that decision is available. The package leaflets which are available from medicine authorities in Sweden,  Norway,  Finland and Iceland contain information on the regulator's views of the risks and uses of the product, and also the ingredients used.

In Canada, BAT is using the brand name ZONNIC of the Scandinavian-approved pouch NRT but has received Health Canada authority to market a product that has different ingredients and flavourings. 

The ingredient lists on the Scandinavian package leaflets and the Health Canada authorization show that  the ZONNIC product licensed for sale in Canada is not the same as the one licensed for sale in Nordic Countries. Instead, BAT's Canadian natural health product nicotine pouches are made with the same ingredients that they use for the VELO recreational nicotine they sell in other countries.

The following ingredients are listed for ZONNIC in the package leaflet authorized in Sweden and other Scandinavian countries: Active substance: nicotine - 4 mg; Other ingredients: cellulose (microcrystalline), ascorbyl palmitate (E304), trisodium phosphate, acesulfame potassium (E950), aspartame (E951); Flavourings: mint flavour

The following ingredients for ZONNIC are identified in Health Canada's natural health product database: Medicinal ingredient: 1-Methyl-2-(3-pyridyl)pyrrolidine [nicotine] - 4 mg; Non-medicinal ingredient: Microcrystalline cellulose; Propylene glycol; Sodium alginate; Sodium bicarbonate; Sodium chloride; Sucralose; Water; Xylitol; Flavourings: Berry flavour; Cranberry flavour; Mint flavour; Spearmint flavour, Topical citrus flavour

An ingredient list is provided for VELO pouches on some retail websites  (although BAT's information is less specific). Nicotine; Microcrystalline cellulose fibers (E460 (i)),  propylene glycol (E1520), sodium alginate (E401); sodium bicarbonate (E500), salt (sodium chloride),  sucralose (E955), water, Xylitol (E967); Flavors

Based on the ingredient list and flavourings, the product approved by Health Canada this week is almost certainly a 4mg version of their VELO product.

Health Canada has authorized BAT/Nicoventures to sell Zonnic in the following five flavours: Polar Mint; Berry Frost; Chill Mint; Cranberry Fizz; Tropic Breeze.

Some of these flavours - tropic breeze, polar mint - are identical to those sold with VELO in other markets. 

There are currently very few restrictions on how BAT can market these nicotine pouches in Canada, other than with respect to how it represents the therapeutic benefits of the product.

In Canada, federal law puts severe limits on most direct-to-consumer advertising of prescription drugs, as it does for tobacco and vaping products. There are fewer restrictions on advertising for non-prescription or health products. 

As a result, advertisements for BAT's nicotine pouches will be allowed on television, in video-games, in corner stores, on social media and in other places where young people have access.

Health Canada has approved Guidelines for Consumer Advertising of Health Products. These explain that the constraints that BAT will face in promoting ZONNIC pouches mostly relate to ensuring that the advertising claims are consistent with the license or authorized labelling. 

Although the authorization counsels consumers to not use the product if they are under 18 there are no age restrictions on the purchase of natural health products. 

Unless there are legal changes, BAT will be allowed to advertise nicotine pouches in all media, with no restrictions on the use of lifestyle imagery, contests, give-aways or other promotions.

As the Thrive website illustrates, in Canada NRT can be promoted with imagery that convokes  "glamour, recreation, excitement, vitality, risk or daring". Such promotions are not allowed for prescription medicines or tobacco or vaping products. 

Based on historical marketing practices of BAT, we can expect that the product and promotional material will be available in convenience store outlets in most provinces. 

BAT has the economic power to distribute and promote nicotine pouches through the 29,000  retail outlets with which they currently have distribution contracts. 

Based on the company's recent marketing of vaping devices, likely promotions include signage, introductory pricing, incentives to retailers, free distribution, counter-top and self-service displays.

BAT nicotine promotions identified by TBDHU in 2019

Provincial governments have the authority to set restrictions on where the product can be sold and how it can be promoted, but few have such measures currently in place.

Provincial governments have coordinated their regulations on non-prescription pharmaceutical products, but do not have a coordinated system for natural health products.  They do retain authority over retailing, and can impose restrictions on if, how and where nicotine pouches can be sold or promoted. 

For example, Quebec regulations do not allow the sale of conventional NRT except in pharmacies, but the wording of the regulation did not anticipate nicotine pouches, and refers only to "chewing gums, inhalers, lozenges or transdermal nicotine replacement patches."

Other companies are positioned to start selling nicotine pouches in Canada, and the approval of BAT's application may facilitate their doing so. 

According to Health Canada officials, more than two dozen applications have been received for market authorization for nicotine pouches, some of which have been refused and some of which are still  under review. 

Those applications which were refused to date failed to provide sufficient evidence that the products were effective as stop smoking aids. Now that the department has accepted the evidence provided by BAT/Nicoventures, the road for other applications will be smoother.

Health Canada faces limits in its ability to refuse authorization: companies can (and do) successfully challenge refusals to grant authorization to natural health products. One of these contested decisions has involved a stop-smoking aid (Resolve). 

This development raises questions about the adequacy of Canadian law to protect the public from new nicotine products.

Health Canada has indicated that the results of a clinical trial were submitted with BAT/Nicoventure's application, but further information is not known at this time.

There has been one published Randomized Clinical Trial of Zonnic as a stop-smoking aid, which was conducted in New Zealand and published in Nicotine and Tobacco Research over 14 years ago. The study was paid for by Niconovum,

This study provides a very slender evidence base on which to permit a new category of nicotine products on the market. It involved only 28 people who agreed to abstain from smoking for three days on each of three occasions: one time using a placebo pouch, another using NRT gum and a third time using Zonnic nicotine pouches. Twenty-one of 28 people abstained from smoking for 3 days using 4 mg Zonnic - a better result than was obtained with 4 mg NRT gum. 

There are no other published clinical trials of ZONNIC or other non-tobacco nicotine pouches as smoking cessation aids currently identified on Pubmed, although there are studies which compare the way the body receives nicotine from pouches with other NRT. The inventor of Zonnic (Karl Fagerstrom) promotes pouches (NP) as a harm reduction product, but recently acknowledged  that "The NP have so far not been well researched and there are only a few papers published."

This decision raises questions about Canada's application of Article 5.3 of the Framework Convention on Tobacco Control .

Like the recent Medicago debacle, Health Canada is again caught in the position of licensing medical products manufactured by tobacco companies. As these companies expand into medically-regulated products, so does the potential for governments to breach their obligations to protect public health from tobacco industry interference. This is especially relevant with respect to stop-smoking medications, which could permit tobacco companies to engage in public relations efforts to forestall tobacco regulations.

This development is a reminder that Canada needs an integrated nicotine strategy.

As with SESH+ nicotine gum, this stop-smoking product is a sharp reminder that Canada needs an integrated nicotine policy. Health Canada has not yet acknowledged the need for such reforms.

In the meantime, provincial governments can help by imposing restrictions on the sale and promotion of nicotine pouches that are equivalent to those in place for tobacco and vaping products. Urgently needed are promotional restrictions and bans on sales to minors.

"Will they?? Won't they??" Health Canada and the ban on flavoured vapes

This post is in two parts. The first part reports on Health Canada's recently-released Forward Regulatory Plan, and what it might (or might not) mean for reducing the appeal and accessibility of vaping products to young people.

The second provides an update on other recent communications by federal officials and why these suggest that we should continue to assume Health Canada is unlikely to finalize its proposed ban on e-cigarette flavourings  under the current ministers.

Part 1: Health Canada's Forward Regulatory Plan 2023-2025

Canadian federal departments are required by Treasury Board policy to "provide advance notice to stakeholders, including Indigenous peoples, on upcoming regulatory changes over a period of 24 months so that they can engage in regulatory development and plan for future regulatory changes at the earliest opportunity." These Forward Regulatory Plans must be updated annually and are generally published at the start of each fiscal year (April 1st).

This year, for reasons not shared, Health Canada delayed the release of its 2023-2025 Forward Regulatory Plan for three months, updating the tobacco control regulations only last week. 

The new plan indicates there are 5 tobacco and vaping regulations under development -- however two of those were finalized in the weeks between the adoption of the plan and its publication on the website. On June 7, regulations to update health warning messages on tobacco products were published in the Canada Gazette, and two weeks later so too were regulations to require vaping manufacturers to report information on sales and ingredients. The three uncompleted regulations identified in the plan are: (1) updates to the Tobacco Reporting Regulations; (2) restrictions on flavourings, and (3) rules for age-gating e-sales of tobacco and vaping products.

As shown on our Timeline of Tobacco and Vaping Regulations, the first of these has been on the workplan for over 6 years, and is not moving quickly. The anticipated date for draft regulations has already been punted 5 times - draft regs were originally scheduled for Spring 2019 it are now not expected until at least Winter 2024. These are expected to increase the amount of information required of vaping manufacturers and to modernize the reporting system for tobacco manufacturers. They may also establish criteria by which reported information is made public by the department. 

A 'time-less' plan to protect youth

The other two identified regulations are aimed at protecting youth from vaping. As reflected in the Timeline, work on both proposals was initiated in early 2021 when Patty Hajdu was Health Minister.   Under Minister Patty Hajdu's successors, however, both these proposals have stalled, and neither currently has a target date for the next steps. 

The draft regulation to ban flavourings (Order Amending Schedules 2 and 3 to the Tobacco and Vaping Products Act (Flavours) and Standards for Vaping Products' Sensory Attributes Regulation)  first appeared on the Forward Regulatory Plan in February 2021. At that time, the stated purpose was; "to prevent vaping product use from leading to the use of tobacco products by young persons and non-users of tobacco products. In particular, the proposed restrictions are intended to protect these individuals from inducements to use vaping products and from exposure to and dependence on nicotine that could result from the use of vaping products." The purpose was later narrowed to remove reference to adult non-smokers and protection from addiction.

Draft regulations on flavour restrictions were prepared soon after (pre-published in June 2021), As discussed in an earlier post, there has been no further indication of federal interest in these regulations, leading to speculation that they might be withdrawn from the Forward Regulatory Plan altogether. Notably, they were not dropped from the plan, although on this year's updated notice the following text was added:  "Reducing the promotion and appeal of vaping products to young people are commitments made in the 2019 Mandate Letter."  This is a curious statement, as it clearly links the initiative to the previous Minister, and to an expired mandate. (There is no inclusion of any mention about youth vaping in the mandate letters which direct either Minister Duclos or Associate Minister Bennett.)

The proposal for better age-gating for e-commerce of vaping products. (Amendments to the Tobacco Access Regulations (Age Verification for Online/Distance Sales). Age verification systems for tobacco have generally focused on face-to-face transactions at brick-and-mortar outlets, as tobacco is generally not sold through e-commerce (as cannabis and vaping products are). In the five years since the vaping trade has been legal in Canada, no provincial or federal government has set standards that e-retailers must meet either with respect to selling to young people or to allowing young people to see the promotional information on their websites. As David Hammond and his research team recently noted, youth face no barriers  "more advanced than selecting a box to confirm that the person accessing the site was above the legal purchasing age." 

The original target date for draft access regulations to be published in Canada Gazette Part I was Fall 2021. No timeframe is indicated in the current plan.

In addition to these two stalled initiatives, there was a third regulatory initiative to protect youth that has now completely disappeared from the regulatory plans of Ministers Duclos and Bennett. 

Restrictions on vaping designs: (Regulations Amending the Vaping Products Promotion Regulations (Package and Design Features) The purpose of this regulation, as described in the 2021-2023 Forward Regulatory Plan was "to protect young persons and non-users of tobacco products from inducements to use vaping products. The proposed regulations would place certain limits on what promotional elements can appear on vaping product packages. They would also impose restrictions on design features that are appealing to youth to prevent their use in the manufacture of vaping products." 

The need for such regulations seems obvious, given the known impact of the design features of JUUL (including the invention of salt nicotine) and the current experience with disposable e-cigarettes. The department has not formally explained why this proposal was dropped from the plan.

In short, although youth vaping is at the same high level that prompted concern in 2021, three measures proposed at that time to address it have been stalled or abandoned. Young people continue to face inducements to try flavoured vaping products, to use colourful and inexpensive disposable products, and to generally face few barriers in gaining access to promotional material on e-commerce websites that are supposed to be age-restricted.

Part II: An update on Health Canada's messaging on flavour restrictions

As reported here in March, the studied silence on the topic by elected and appointed officials and the disappearance of the regulation from the 2023-2024 departmental workplan pointed at a decision to let this regulation die quietly on the vine. Recent communications from the department offer no reassurance that new regulations with respect to flavours, access or design are planned.

The current Departmental plan identifies a "new" approach to smoking cessation and a "reconsideration" of youth vaping. The workplan identifies six "new or ongoing measures to address youth vaping" - none of which are new regulations on flavours, access or design features.  

Official statements make no reference to new regulations. This spring, Health Canada announced new regulations that will require vaping manufacturers to provide information to government (not consumers) on the ingredients of their products and on the quantity of their sales.

The press release which announced the new regulations also provided an overview of federal actions to "address youth vaping through public education campaigns to inform youth about the risks and harms associated with vaping, by prohibiting the promotion of vaping products where it could be seen by youth, requiring warnings on advertisements and package labels about the risks of vaping and limiting the concentration of nicotine in vaping products."  There was no mention of any plan to address flavours, reduce access or curb designs.

Answers to Parliamentarians suggest youth vaping is not the focus of flavour policies. This spring government officials responded to parliamentary inquiries about flavour regulations without stating any commitment to put these in place. Instead, they focused their answer on their intention to encouraging smokers to switch to vaping. 

On June 6, for example, Senator Chantal Petitclerc raised concerns about high rates of youth vaping "due to the appeal and availability of flavours. The existing restrictions do not seem to be sufficient. As senators will recall, vaping was supposed to help adult smokers stop smoking without attracting young non-smokers. Does the government realize that it needs to act quickly to make vaping less appealing to young people and thereby protect them from nicotine dependency?" (Senator Petitclerc has reasons to express concerns -- it was she who introduced the government's legislation to legalize the vaping market). 

The answer was provided by Senator Gold, the government's official representative in the Senate. Typically, such answers are read from a binder of responses prepared by departments in anticipation of Question Period. His reply connected the fate of vaping flavours to the department's desire to see smokers switch to vaping products.  "As you know, honourable senators, the government has already taken a number of steps to reduce the appeal of vaping products, not only for young people but for everyone. The government eliminated and banned lifestyle advertising on television and in stores, as well as the social media content of influencers who are trying to encourage young people to take up this habit. That being said, I have been informed that the government is still examining this issue to find more ways to help adults, in particular, transition from smoking cigarettes, cigars and the like to vaping, while not encouraging the younger generation to take up this habit."  

On May 2, 2023 Bonita Zarrillo, the NDP's deputy health critic, submitted a written question pressing for information on "the timeline for the government to decide on final regulations for flavoured vaping products" and whether "the government [is] still committed to reducing youth vaping rates through a targeted ban on flavours, including mint and menthol, that appeal to youth?" (Question No. 1493).

The official answer was delivered on the last day before the House rose for the summer (June 26, 2023). The official answer was delivered on the day before the long summer break (June 26, 2023). In almost 400 words, this official reply states that the government "remains committed to preventing youth vaping" but says nothing to indicate a commitment to finalizing the regulations, other than a statement that the department "continues to assess the input it received from Canadians in the consultation."

Related resources:

* Timeline of Tobacco and Vaping Regulations

* Comparison of tobacco regulations in Forward Regulatory Plan 2018-2020 to 2023-2025

* At a glance- Provincial Regulations on vaping products

* Timeline of selected regulatory actions on electronic nicotine devices.

BAT doubles down on disposable vapes in Canada (while regulators in other countries push back).

This post provides an update on disposable electronic nicotine devices in Canada, identifies some important information gaps in Canada and notes key developments with respect to these single-use plastic products in other countries.

Canada's largest tobacco companies are intensifying their sales of disposable e-cigs.

Last month, the Canadian subsidiary of British American Tobacco (Imperial Tobacco Canada Ltd), introduced a third version of its disposable vaping device, VUSE GO. The VUSE GO EDITION 5000 delivers five times as much nicotine as the original 500-puff VUSE GO and more than three times as much as the 1,500 puff VUSE GO XL.

Unlike cigarettes, vaping products quickly change

In the 5 years since vaping products were legalized in Canada, BAT has revamped its product offerings three times. In the summer of 2018, the company sold two devices: the refillable eTank system and liquids and the eStick cig-a-like. Within a few months, facing stiff competition from JUUL, it introduced the ePEN pod system. About 16 months later, in January 2020, BAT introduced the ePOD system, which was designed to deliver salt nicotine. By the following year, only the ePOD remained for sale.

One other global tobacco company also sells vaping products in Canada. The Canadian subsidiary of Philip Morris International (Rothmans, Benson and Hedges) sells a pod system (VEEV ONE) and a disposable vape (VEEV NOW).  The disposable has been rebranded since it was introduced last summer as VEEBA. Vaping products have been introduced and then withdrawn by other multinational tobacco companies: Imperial Brands sold BLU from December 2018 until July 2020, and Japan Tobacco International sold Logic from early 2019 until the summer of 2021.

This rapid market change contributes to the difficulties in linking specific product designs when monitoring how e-cigarettes contribute to people stopping smoking or how they recruit new nicotine users.

Disposables are being used to drive down the cost of vaping.

The VUSE GO 5000 reduces the cost of using VUSE liquids to less than one-fifth of the price charged a year ago  -  which was before the federal excise tax of $1 per 2 ml was applied. 

Including tax, VUSE GO 5000 sells for $25.99, which makes the cost per puff just over one-half cent  ($0.0052). By comparison, the cost-per-puff of the $19.99 Vuse GO XL is $0.013, for the $9.99 Vuse GO is $0.02 and for an $8 ePOD, which delivers 250 puffs, the price is $0.032.

PMI/Rothmans Benson and Hedges is also making vaping increasingly affordable -- in spite of the federal excise tax. A starter kit including pod device and package of 2 pods (providing 800 puffs) now sells for $11.99 ($0.015 per puff); Individual disposable products (500 puffs) sell for $11 ($0.022 per puff), reduced to $6 each if bought in quantities ($0.012 per puff). 

The companies' use of volume discounts should raise red flags among regulators, as they facilitate sales to youth. PMI/RBH, for example, discounts each disposable  unit by $5 (45%) when it is sold in bundles of 9 or 11 units. This provides a financial incentive for "legal age" customers to resell to underage users through social sources. 

Regulators might also want to consider whether the company is selling some products below the price of manufacture and distribution (in order to recruit long term customers). Once the $2 excise tax is removed from the multi-pack price of VEEV NOW, this disposable device is marketed at $4 per unit.

Disposables are expanding a vaping market that was otherwise flat.

BAT is growing revenues from vaping only because of 's revenues from pod-systems is flat -- but for disposables is growing

In October 2022, BAT pivoted to the disposable market  in Canada and its other "top markets". The results of that initiative were reported to investors earlier this spring. In the 5 countries that "represent 88% of vapour industry revenue" (US, Canada, UK, France, Germany) the revenues from pod systems were essentially flat 

This spring, BAT reported to investors that disposables have not replaced the pod-based systems, but are instead expanding e-cigarette revenues in the "top 5 markets". According to the company, sales in the US, Canada, UK, France, Germany represent 88% of the world's vaping industry revenue. BAT reports that since 2020, revenue growth for pod systems has been essentially flat (increasing by 4%), but that the sale of disposables has driven the sector to a 30% overall increase.

From BAT's report, it appears that those who buy disposable e-cigarettes are not the same customers who previously purchase their VUSE pod-systems or cigarettes ("very limited cannibalisation"). 

Similar information for the Canadian market was reported to Ontario courts earlier this year, with "[e-cigarette] revenues growing by over 30 percent, which was driven mainly by the launch of a disposable-device."

Disposable e-cigarettes appear to accelerate youth vaping

Just as the marketing of salt-nicotine JUUL was associated with high rates of youth vaping a few  years ago, the wide accessibility of inexpensive and flavourful disposable products in England and the United States is associated with youth vaping in those countries. These products often are sold illegally (higher than permitted nicotine in England, and without FDA permission in the USA).

Data from the ITC Project survey of young adults (16 to 19) show that as young people turned to disposable e-cigarettes, the rates of use doubled from 12% to 24%. (Slides shown below were presented at the Ottawa Model Conference earlier this year, click to enlarge). The data which was presented for Canada (not shown) indicated that at the time of the survey (August 2022) Canadian youth were predominantly using pod-systems, although disposable use was growing. It is important to note, however, that this survey predated the distribution through convenience stores of disposable products sold by the large tobacco companies (VEEBA and VUSE GO).

The impact of disposables on Canadian youth is not yet known

While disposable cigarettes made by STLTH and others have been on the market for a couple of years, it was only a year ago that tobacco companies entered this market and began using their convenience store distribution system to expand availability. The impact of this is not yet known: a national survey on vaping behaviour was conducted over the Christmas-New year period in 2022-2023, but the results will not be released until later this summer. The ITC project will be gathering data later this summer.

The challenge of associating product design to youth vaping is made more challenging because Canada's public health surveillance system does not currently collect information on the brands or types of products used by children or adults. For example, the questionnaires for the Canadian Tobacco and Nicotine Survey, and Canadian Student Tobacco, Alcohol and Drugs Survey do not ask about the brands, device designs, nicotine levels or price, although information on these issues is sometimes gathered in the consumer research commissioned by the federal government.. The ITC project does, however, collect this information.

Nor is it clear how many e-cigarettes (disposable or otherwise) are sold in Canada. Manufacturers are not required to make such information public, and firms which track sales (like ACNielsen, IRI, etc.) do not permit subscribers to their consumer tracking services to share the information. Last month Health Canada finalized reporting regulations for vaping companies, which will require them to submit sales data twice a year. The first of these reports is not due until next January. Health Canada has not yet indicated how (or when or whether) this information will be shared with the public or researchers.

Disposable e-cigarettes are an environmental threat

Communities and governments are increasingly concerned about vaping devices contributing to toxic plastic and electronic waste. The plastic casing, the toxins in the e-liquid residue, the lithium batteries and the heavy metals in the circuit boards all pose environmental concerns. As Canadian federal environmental officials recently acknowledged: "If these devices end up in the environment as pollution, they may be harmful to wildlife and their habitats." 

The environmental concerns are not limited to those related to littering. Throwing e-cigarettes into the regular waste stream also causes harms. As the British environmental agency, Material Focus, recently reports, such electronic waste needs to be separately recycled, but producers, importers, distributors and retailers of disposable and other forms of e-cigarettes are not currently required to do anything to ensure this happens. That company estimates that over a million a week are being binned and sent to landfill.

This month, a report commissioned by the Scottish government considered environmental impacts related to littering, unsafe disposal of their contents including lithium batteries and chemicals, as well as the impact with respect to greenhouse gas emissions and water consumption generated in their manufacture. It considered 13 categories of policy options, of which 9 were recommended for further consideration. These ranged from banning disposable devices, establishing a deposit-return system, setting design standards, requiring replaceable batteries, specific levies and better enforcement of sales to youth.

To date, at least one country has banned single use e-cigarettes (New Caledonia), and many others have expressed an interest addressing the environmental and health impact of these products. 

Recent actions by governments include:

* Irish government consulting on disposable e-cigarettes (June 2023)

* English government including disposables in its consultation on measures to reduce youth vaping (closed June 2023)

* Switzerland finalizing a higher tax on single use e-cigarettes than other e-liquids (CHF1 per ml vs CHF0.20 pr ml). (June 2023)

* New Zealand health ministry announcing its intention to reduce the maximum allowable nicotine in disposable e-cigarettes and to require batteries to be removable (June 2023)

*  French minister of Health (Francois Braun) saying he was personally in favour of banning them, and hoped to work with parliamentarians to include them in the governments upcoming tobacco strategy renewal. (May 2023)

* Australia's Minister of Health (Mark Butler) announcing his intention to ban disposable e-cigarettes, while allowing others to be sold under prescription. (May 2023)

* the German Bundesrat (federal council of states) calling on government to work towards banning single use e-cigarettes on the national and EU level (March 2023)

* a cross-party private members' bill to ban disposable e-cigarettes was introduced to the U.K. House of Commons. (February 2023)

The disposable vape market is proving difficult to control 

Governments which have clamped down on the e-cigarette marketing are having difficulties stopping the sale of products which they have banned.

The U.S. Food and Drug Administration has since not authorized any single-use vape for sale, and has ordered all unauthorized products off the market. Nonetheless, companies collecting data from retail store sales recently reported that there are thousands of disposable products still available.

Denmark banned flavoured vaping products in April 2022, but has since discovered that young people still have access to flavoured and higher-nicotine single use products. Some of these enforcement challenges were reported to Danish legislators, and the minister is considering further regulatory changes.

This year, information was released showing that officials in the United Kingdom have seized more than a million disposable vaping devices that contained illegally-high levels of nicotine.

Illegally imported Chinese vapes may also be illegally exported from China.

Last year the Chinese government imposed strict controls on the e-cigarette industry. The new measures included a ban on flavourings and requirements that all domestic wholesales be managed through a centralized system. The new Chinese law exempts exports from these requirements, but nonetheless requires exports comply with the laws of the importing country. On this basis, it seems that the high-nicotine exports to the U.K., for example, are a breach of both UK and Chinese health regulations.

The global tobacco treaty (the Framework Convention on Tobacco Control) does require countries to cooperate in implementing the public health measures outlined in the treaty. The treaty was drafted before the era of electronic cigarettes, and countries are divided on whether or how public approaches to e-cigarettes fit with the convention. E-cigarettes are expected to be discussed at the November 2023 Conference of the Parties, although the importance of international cooperation in controlling imports and exports does not appear to be on the agenda.

Sweden's Public Health Agency reports on the health effects of Vaping.

 In recent years, several governments have commissioned reports on the health effects of vaping. In addition to the 2018 report of the National Academies of Science and Medicine, reviews have been commissioned in the European Union, Australia, Spain and others.

Added to this list this week is a report from Sweden's Folkhalsomyngidheten, the Swedish Public Health Agency. The report was commissioned by the Swedish government in April 2022.

The results of this commissioned review were published in two parts: A plain-language summary of their findings and a description of the methods for the scientific review on which the conclusions were based. The release of the document was accompanied by a press release, in which the agency called for "expanded regulation", and the adoption of regulations "that is more similar to the protective legislation that exists for tobacco smoking, including bans on flavourings, regulation of nicotine content and marketing bans.

Background on tobacco and nicotine in Sweden

Sweden has unique circumstances with respect to tobacco. It is the only EU nation that is not required to ban the sale of oral tobacco, and Sweden has a long tradition of using snus and a lesser tradition of cigarette smoking than in most other European countries.

The preference for snus as a source of tobacco is not the only reason why cigarette smoking rates were lower in Sweden than elsewhere. Sweden maintained a government monopoly on tobacco until the early 1990s, which made it easier for the country to be one of the first to adopt comprehensive tobacco control measures - including powerful rotating health warning messages as early as the 1980s. Sweden's neutrality in the world wars also contributed, as it avoided the impact of soldiers returning from war addicted to smoking. The presence of a public broadcasting system which did not allow television advertising reduced the impact of tobacco marketing.

Prevalence of tobacco and nicotine use in Sweden

In this report, the Swedish Public Health Agency focused on the growing use of nicotine products by young people -- including traditional snus, nicotine pouches and e-cigarettes.  

It found that snus use among girls in year 2 (grade 11) had tripled in five years - from 6% in 2018 to to 22% in 2022, shown below. At the same time, nicotine pouches and e-cigarettes had also become more popular with students. In the same grade, each of these products had been used by one in five students in the past month.

All told, almost one-fifth of women (19%) and one-third of Swedish men (31%) use some type of tobacco or nicotine product, either daily or occasionally, with many sourcing nicotine from more than one product type.

The health agency concluded different levels of relationships between smoking, snusing and vaping, finding a "likely" relationship between using e-cigarettes and subsequently smoking and "possible" relationship with snus. There were too few studies on nicotine pouches for them to make a finding.  

 "Among people who use e-cigarettes, there are more people who start smoking over time compared to people who do not use e-cigarettes. The result has moderate reliability, which means that it is likely that there is a relationship. The association is more reliable for people under 18, but it is possible that it also exists among adults. It is also likely that for people who use e-cigarettes, there are more who develop an ongoing use of smoking tobacco over time."

"Among people who snuff, there are more people who start smoking over time compared to people who don't snuff. The results have low reliability, which means that it is possible that there is a relationship. There are too few studies to draw conclusions about whether or not there is a connection between snuff and an ongoing use of smoking tobacco."

They did not conclude that using snus or e-cigarettes was associated with smoking cessation: 

"Among people who smoke tobacco and who have also started using snus or e-cigarettes, it is not possible to draw any conclusions as to whether there is any connection with changed smoking habits or not. This applies to all kinds of changes, both smoking cessation and increased or decreased use of smoking tobacco. For e-cigarettes, this is because the studies that exist are not consistent. In the case of snus, there are too few studies to determine whether or not there is a connection."

Conclusions on health effects.

This report provides a plain-language summary of many health effects of tobacco and nicotine. A machine translation of the report's findings are printed below.