President Obama signed the FDA tobacco bill recently passed by Congress into law on June 22nd during a Rose Garden signing ceremony at the White House.  

AWMA had consistently opposed this new law, recognizing that the U.S. Food and Drug Administration (FDA) is not the appropriate agency to oversee tobacco and preferring a more reasonable approach to tobacco regulation.  This new law would allow the FDA broad federal regulatory powers of almost every aspect of tobacco manufacture, distribution and sales.  The FDA will now be responsible for issuing regulations instituting the provisions of the new law including new graphic warning labels and advertising restrictions.

While the new law would prohibit the FDA from actually banning tobacco, there will be major changes which include the banning of flavored cigarettes and a ban on the use of marketing “light”, “mild” or “low” with respect to tobacco products.  The new law establishes a tobacco control center within the FDA and gives it full authority to regulate the content, marketing and sale of tobacco products to protect public health.  While the new center cannot ban nicotine it would be able to manipulate the levels of nicotine in tobacco.  The new law limits any advertising that could attract young smokers.  

The costs associated with the expanded FDA regulatory authority would be paid through the establishment of so-called “user fees” levied on manufacturers.  The overall costs – over 5 billion over ten years – are to be scheduled as follows:

(1) AMOUNT OF ASSESSMENT- The total amount of user fees authorized to be assessed and collected under subsection (a) for a fiscal year is the following, as applicable to the fiscal year involved:
 

`(A) For fiscal year 2009, $85,000,000 (subject to subsection (e)).
`(B) For fiscal year 2010, $235,000,000.
`(C) For fiscal year 2011, $450,000,000.
`(D) For fiscal year 2012, $477,000,000.
`(E) For fiscal year 2013, $505,000,000.
`(F) For fiscal year 2014, $534,000,000.
`(G) For fiscal year 2015, $566,000,000.
`(H) For fiscal year 2016, $599,000,000.
`(I) For fiscal year 2017, $635,000,000.
`(J) For fiscal year 2018, $672,000,000.
`(K) For fiscal year 2019 and each subsequent fiscal year, $712,000,000.

AWMA will be closely monitoring the FDA implementation of the new law to ensure that distributor concerns are heard and to report to members on the issuance of any regulations pertaining to our industry.