January 27th, 2015

Big Tobacco's Little Helpers

Public health disinformation encourages regulation that protects the cigarette trade

This is a guest post by David Sweanor, Adjunct Professor of Law at University of Ottawa and lifelong public health campaigner,  Starts here…

There has been a concerted effort by opponents of vaping to denigrate these products – see endless stories on formaldehyde, ultrafine particles, poisoning, third hand nicotine exposure, gateway effect, renormalisation and the multiple violations of fact and presentation by WHO and its ill-judged supporters.

Sadly, but not surprisingly, these efforts at misinformation appear to be convincing many people that vaping is not a good alternative to smoking lethal cigarettes. Surveys of beliefs about relative risk show that fewer smokers now see vaping as less hazardous than smoking, let alone understand that the risk differential is enormous.

Widespread misperception – and getting worse

I am now hearing the same thing when talking with consumers; smokers who fear switching and vapers who are confronted by people telling them of ‘some new study that proves vaping is more hazardous than smoking’.

The point was driven home in the last few days in reading two comprehensive new reports from the Wells Fargo ‘Tobacco Talk’ retailer survey. The astute Bonnie Herzog, until now the most bullish Wall Street analyst when it comes to the ability of non-combustibles to replace cigarettes, is concerned about the momentum in the market, as the survey highlights the flow of misinformation on relative risks – one of the key reasons to switch from smoking to vaping. Simply put, there is a tremendous level of pseudo-scientific misinformation and scare stories that is feeding a moral panic about vaping. The inevitable result is that it is more likely that smokers will stick with deadly combustibles, more vapers will revert to smoking, smoking will decline more slowly than it otherwise would and the lucrative cigarette trade will have again been protected from a disruptive threat.

Bonnie Herzog, Wells Fargo, Independent Vapors Manufacturers Survey January 23, 2015:

While we estimate the industry will continue to grow robustly in 2015 (~40% topline growth), reaching retail sales of $3.5B, we would be remiss if we didn’t acknowledge the increased uncertainty we have observed among investors, our retailer/industry contacts, and consumers over the past 6-12 months. We believe this unfortunate trend is being driven by:

(1) mixed messages from the media;

(2) lack of FDA regulation or leadership; and

(3) lack of vapor industry or public health alignment, which are in turn driving worsening public perception of the vapor category. This is exacerbated by the fact that it is difficult for the industry to defend itself or make any modified risk claims (that their products could be less harmful than combustible cigs).

Comments from retailers:

“New ads on TV sponsored by the state, saying all sorts of negative things about e-cigs . . .”

“Public needs more awareness of vaping before regulations take hold and restrict use”

“The industry has basically let the anti-e-cig movement say what they want without rebuttal.”

Comments from VTM (Vapor Tanks Mods) manufacturers:

“. . . our stores grow 12% a month. EVERY MONTH. We just need more. Once the FDA regulations come out, all this spin that various parties keep throwing at this, the federal and state tax issue gets resolved; it is game over for conventional cigs. The issue facing the VTM’s now is, stay alive till then, and trust me we get attacked from everyone, even Big Tobacco inside our own industry, and government at all levels. They have leveraged uncollected future cigarette taxes for the next decade that they are in EXTREME FEAR of losing and not being able to cover the debt service on that leverage that is at the core of the anti-Vape propaganda. Let’s be honest, our US and State governments are in the cigarette business, Big Tobacco is just their supplier and marketing company.”

“So much is focused on the “unknown” 20-50 studies…however, the media won’t take a spectrum of risk approach despite the HUGE benefits to smokers’ health TODAY – it’s frustrating and transparent that those often quoted in the media do not have the best interest of the individual smoker in mind.”

“Mis-information campaigns funded by tax settlement dollars are taking their toll.”

“The largest negative impact is prohibitory regulation, since that completely skews the public perception, regardless of the science.”

“Majority of the general public has been consistently misinformed about the safety of vaping.”

Disturbingly, these attacks on vaping are nothing new in the realm of nicotine policy. There is a very long history of alternative products that appear to have the potential to challenge the market dominance of cigarettes by allowing consumers far less hazardous ways to get nicotine. In each case the threat has been seen off, leaving the tobacco companies free to continue their exceedingly lucrative and depressingly deadly oligopoly with its near-monopoly over the delivery of a very widely used dependence producing drug. We see several ways in which anti-tobacco activists have aided the cigarette business:

  • banning alternative products (Advanced Therapeutic Product’s nicotine inhaler, snus in the EU and several other jurisdictions, pharmacist-made nicotine lozenges )
  • driving them from the market with adverse publicity and regulatory attacks (Star Scientific’s ultra-low nitrosamine lozenges, various heat-not-burn products)
  • over-regulating to the point that cigarettes get a huge marketplace advantage (massively constraining all forms of nicotine replacement therapy)
  • misinforming consumers about relative risks or withholding candid information (smokeless, snus, NRT; nicotine in general).

The big cigarette companies are protected from competition from disruptive technologies that would otherwise thwart their ability to constantly increase their prices and profit margins. They are also sheltered from the regulation and litigation that would result from selling a product that is much more harmful than acceptable alternatives available in the marketplace (that is, after all, the basis for finding something to be ‘unreasonably hazardous’). A result of seeing off these threats to the lethal cigarette is that Big Tobacco is now worth hundreds of billions of dollars more than at the start of the Tobacco Wars, despite having also gifted untold billions in dividends to shareholders during this time.

BAT’s market value has grown dramatically during the most intense phase of the Tobacco Wars

The combined stock market market value of the cigarette companies on the Financial Times 500 now handsomely exceeds half a trillion dollars, and the sector was once again an incredibly lucrative performer last year.

Market capitalisation – the total market value of the company’s shares – approximates the expected discounted flow of future profits/dividends after tax

Yet the ability of this industry to see off existential threats from alternative technology is not due to some cabal of evil geniuses in these companies. It is instead largely due to the unintentionally helpful actions of people who consider themselves to be sworn enemies of these companies.

It is often noted that Big Tobacco has few friends. But, with enemies like these, they hardly need any.

30 comments to Big Tobacco’s Little Helpers

  • David Sweanor

    For anyone keeping score, the market value of the Big Tobacco companies listed on the FT500 has now surpassed $700 billion. There is also no apparent introspection on the part of those promoting the policies that stimulate that value growth while claiming to be enemies of the industry.

    • Joe Gitchell

      Thanks for the update, Dave–and given recent attention from the likes of the WSJ (https://www.wsj.com/articles/u-s-tobacco-industry-rebounds-from-its-near-death-experience-1492968698?tesla=y), you may face requests to do a further/more comprehensive refresh (please count me as an “aye”!).

      Joe

      My employer, PinneyAssociates, provides consulting services on tobacco harm minimization (including nicotine replacement therapy and vapor products) to Niconovum USA, RJ Reynolds Vapor Company, and RAI Services Company, all subsidiaries of Reynolds American Inc. In the past three years, PinneyAssociates has consulted to NJOY on electronic cigarettes. I also own an interest in intellectual property for a novel nicotine medication.

  • […] confusion about e-cigarettes, an alternative to smoking that many smokers have found to work. See Big Tobacco’s Little Helpers for David Sweanor’s take on this kind of […]

  • Dr. Kirui

    Great article. Good job Clive. Be blessed

  • kioi

    Lets keep this campaign against vaping so that can increase awareness to the population. It is unhealthy and harmful to our health. Great read

  • jredheadgirl

    Clive,

    Which HnB products have been driven off of the market? …curious…thanks.

    • David Sweanor

      The first generation products from Reynolds, Premier and Eclipse, were roundly attacked by anti-smoking groups, statements that they were less harmful than regular combustion cigarettes were attacked in the courts as ‘deceptive'(including by state AGs)and there was the now-usual moral panic issues about potential risks (‘not risk-free’), potential to somehow promote smoking, ability to be adapted for use with illicit drugs, etc.

      The products were early versions of nicotine-without-smoke technological innovation, and had lots of areas for improvement in such things as taste. But, still, there were smokers who switched to them, there was an initial bit of excitement that they could herald a new technology-based effort to replace lethal combustibles. Apparently the Augsburg test market in Germany (under the brand name Hi-Q) got a 4% market share.

      But in the face of such opposition and the company at the time lacking the financial resources to overcome it, the products left the market.

      Well, apparently except for a supply that was maintained for Reynolds executives.

      Overall, it was a good illustration of how NOT to engage in ‘policy jujitsu’.

  • […] here: Turning the tables on public health – let’s talk about the risks *they* create and here Big Tobacco’s Little Helpers.  The directive provides a number of specific cases of this problem – costs, burdens or […]

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  • Junican

    The ‘Master Settlement’ in the USA had a peculiar effect. That effect was to protect tobacco companies against State originated law suits based upon the health effects of smoking. The consequence was that tobacco companies had no option but adopt a position of neither agreeing nor disagreeing with health claims. In the Scottish Supreme Court, in the McTear V Imperial Tobacco Case, the CEO of Imperial Tobacco said, “We just do not know” (regarding whether or not smoking causes lung cancer). Thus, tobacco companies became simply suppliers to a demand. As a result, tobacco control gained a monopoly.

    Is it any wonder that charlatans moved in and took over? Is it surprising that politicians are trying to make political capital from bashing ecigs? Is it any wonder that snus is banned in the EU?

    Forgive me for saying so, but you chaps created the ‘Public Health’ monopoly, and have yourselves been excommunicated. There is no one to defend you.

    If you succeed, I shall eat my hat. There is an ‘iron triangle’ – charlatans, politicians and regulators. As happened with we who enjoy tobacco, consumers are out of the loop.

    You have already lost.

    • Guy Eaton

      There some people within the Public Health Industry who support EC, however, they are not that outspoken presumably lest they get excommunicated. They have conducted a lot of research with very positive results and even been on prime time TV, but alas people seem to ignore them hence the very strong influence of propaganda – which seems to go on for eternity even if it has been entirely discredited. The public seem to be completely ignoring any positive research results and just taking note of fraudulent research that has negative results. This bizarre research tends to be characterised by findings and conclusions that don’t follow in any way at all! In fact, some of results are positive toward E-cigarettes, however, the conclusions are negative! The public generally just read the sound bite conclusions. It is evident to me that as long as an Organisation(S) have enough power, money and influence they can do exactly as they please when they please even if the impact is to kill millions of people. It is absolutely despicable, and totally immoral.

      • Irish Lass

        Guy
        you are absolutely right! As a result of what I’ve seen happening with e-cigs and the scepticism about the tobacco control and public health domain that this has given rise to, I have been researching quite a lot of health-related stuff on the internet. I am becoming aware of more and more of this kind of behaviour. The tactics used by tobacco control (incl the WHO) to convince the public of the risks of second-hand smoke were just as bad – and used just as bad science, – as they are now using in their attacks on e-cigs. Also, I just saw a video on “the forbidden cures for cancer”, about how clinics offering successful but non-pharmaceutical treatments in the US in the early 20th century were forcibly closed down. Some moved to Mexico in order to be able to continue to offer these treatments to people. Now, I don’t know how to check whether this is really true or not – there is a lot of rubbish on the internet – but it sounds plausible to me. And, if true, is just as bad as what is now happening to snus and e-cigarettes. If you are interested, take a look at the stories of Rene Caisse (who developed a herbal treatment called Essiac) and Max Gerson (who came up with a mainly nutritional approach to beating cancer).

        • john

          Irish Lass Hi
          would be a bit wary re unusual cures for cancer especially back in the early 20C, diagnosis was not that reliable back then, some cures may have been of people who did not really have cancer.
          Another aspect of the history is that medicine and especially ‘public health’, as a semi-transnational and very large bureaucratic structure is a phenomena that only took off in the 1950s and 60s.
          What we are seeing, in the case of e-cigs is a good example of how such large bureaucratic structures can so institutionalize Group Think that they become unable to learn/change.

          The following is from Daniel Ellsburg on the pathology of groupthink and self-deception:

          “The urgent need to circumvent the lying and the self-deception was, for me, one of the ‘lessons of Vietnam’; a broader one was that there were situations – Vietnam was an example – in which the US Government, starting ignorant, did not, would not, learn. There was a whole set of what amounted to institutional anti-learning mechanisms working to preserve and guarantee unadaptive and unsuccessful behaviour: the fast turnover in personnel; the lack of institutional memory at any level; the failure to study history, to analyse or even record operational experience or mistakes; the effective pressures for optimistically false reporting at every level, for describing ‘progress’ rather than problems or failure, thus concealing the very need for change in approach or for learning. Well, helping the US Government learn – in this case learn how to learn – was something, perhaps, I could do; that had been my business”

  • I just finished the Vaping Truth Survey, 72 countries, over 7,000 participants. The results and more, from vapers, Mr. Bates. I am not a “professional” survey maker, but believe it is just what you’re describing. Explaining both our experience & concerns was just part of what this survey was about.

    If it is of interest or help, please by all means see it here on facebook: https://www.facebook.com/groups/VapingSurvey/
    and on the blog in part at the moment: http://vapinglinks.wordpress.com

    There is another one by Michigan Smoke-Free Alternatives Coalition (M.S.F.A.C.)
    by J Ervin Bates and their first release is found here: http://ow.ly/I3I76
    I appreciate the awesome work you do.
    Kevin Crowley.

  • Chris Price

    Very true, Humph. Unfortunately.

    • John

      ISO produces standards for things like the safe handling of food, no?
      It might be a bit of a stretch for them to get that prescriptive about something as hard to define, discretionary, as small scale personal electronic vaporisers?
      Mind it will give plenty of time and funds for conferences, papers and expenses.

      • Humph

        ISO standards cover a huge raft of subjects, just glance through this glossary: http://www.standardsglossary.com/index.htm. Manufacturers align their processes and products to conform with them, at least if they want to trade internationally. There is a strong tendency for European standards to adopt ISO ones. Moreover, whilst standards don’t make the law, legislators often draw on them. They shape the future of our products.

  • Humph

    The International Organization for Standardization (ISO) is about to start work on establishing standards for e-cigarettes. To be more precise, the work will be carried out by ISO’s Tobacco and tobacco products Technical Committee, where representatives of tobacco corporations will be the sole industrial experts on e-cigarettes.

    We can rest assured that, as ever, they will do their utmost to protect the public from dangerous products. It would therefore not be unreasonable for them to seek to avoid the risk of mishandling dangerous e-liquids by ensuring that all e-cigarettes be sealed; and to avoid the risk of product propagation to minors by excluding all but a handful of flavours. Tests to ensure the consistency of product emission would naturally enough require the exclusive use of the industry’s well-established smoking machines.

    A not so little help from ISO for the tobacco industry (that, through fees paid to ISO members, helps fund it).

  • Prof. Sweanor makes a great point and his conclusion is full of irony. A very sad one, where we all lose. I just hope that more who are against tobacco get beyond emotions and think logic. Thank you Prof. Sweanor, Thank you Clive Bates.

  • Anonymous has my attention fully. Here in Canada alone of all the active voices, testimonies and surveys comparing smoke vs vapor, policy makers and law commites continually change the laws and classifications to suit placing vapor under tobacco control. Those enticing little bottles of flavor induced (or not) have a market value equal to smoke. Parrallel both as one and double the pleasure……in tax$.

    Quote: ” For all the power of facts, people do not react to health messages with cold, hard reason. They respond to them emotionally, said Paul Slovic, a pioneer in the field of health communications at the University of Oregon. When smokers are confronted with an image that makes them feel unlovable, unhealthy, unappealing or ashamed — and they link those feelings to their cigarette habit — they will, he said, be primed to…… quit.”( or whatever)

    Published within an article L.A. Times June 26th 2011 on Barb Tarbox images to be used is the US and Canada on the face of cigarette packs. In all due respect Clive and Dave it is time to unify this M.O.V.E._ment) on all levels delivering the clear message ” our lives are at risk, no one else’s ; therefore we demand to practice our rights in preserving that right with a thus already proven safer alternative.” (change the wording as needed but not as dictated to by such mental midgets as tobacco control.

    We MUST ” Get Up! Stand Up!…….for our “rights” I know I know…..but it looks like we are smoking! I get! ” They knnow”….. We are willing to pay ” dearly ” for it!

    Carry on and vape safe! Regards : Psychology 1o1

  • Anonymous

    I often wonder if the battle to prove the efficacy and relative safety of vaping compared to tobacco smoking means that the industry is being sidetracked on where it is focusing its energy. We’re trying to persuade/prove the vaping and THR benefits to the policy makers and Public Health, when frankly they probably (if not certainly) already know the truth. Their biggest fear has to be a mass exodus by smokers to ecig use and in particular generation 2/3 open systems. This is what all the media announcements and misinformation is trying to prevent. Whilst the number of full time vapers remains relatively low then they can dictate policy without fear of mass recriminations/objections from the electorate. A few hundred or thousand die hard vaping advocates can be ignored and walked all over. Energy and focus must be spent on educating the non smokers in the same way that charities successfully appeal to the public for donations when a catastrophe occurs. The non smoking public has to understand THR and be motivated to support a product that has the potential to save millions of lives. They’re happy to support calls to end Ebola or drought suffering around the world and surely the demise of tobacco smoking, if allowed, is as equal in importance to anyone who values human life. Somehow money needs to be raised in order to fund the PR that is necessary to educate and gain support for the demise of tobacco smoking by supporting vaping. Everyone seems to ignore the non smoking public, but politicians especially, realise that the reason that they can continue to policy protect and support Big T is because smokers/vapers are a minority and the majority of the public are basically anti smoking. The industry therefore needs to turn the non smoking public into becoming pro vaping and use whatever resources are necessary. Fighting an insular battle may not simply be enough.

    • Clive Bates

      Dear anon – I think this is very true, and one of the things that vapers can do is to explain their experience to (non-smoking) friends, relatives, journalists and elected representatives. We have found that the visceral authentic testimonies of vapers provided en masse have carried much more weight than the equally compelling scientific evidence.

      Don’t write off direct political engagement by vapers though – the political calculation is

      number of people holding a view x likelihood it will change their vote

      That means a small number of people can be very effective at the margin if they are determined use their vote for a cause. There is a great book by Mark Penn, Microtrends, which explores the important of committed minority interest groups:

      …the biggest trends in America are the microtrends — the smaller trends that go unnoticed or even ignored. One percent of the nation, or 3 million people, can create new markets for a business, spark a social movement, or produce political change.

      Vaping meets these criteria, and has an activist tendency that could make it an effective political force.

      • Jonathan Bagley

        I agree with Clive. I’m sure my friends and family thought I’d never quit smoking; and the fact that I did, with no difficulty, has definitely made a big impression. Everyone now knows somebody who’s switched from smoking to vaping and it’s difficult to argue that disco smoke and Nicorette inhaler nicotine from Boots are killers.

      • Dan

        Clive

        Would there be a possibility in a national pro-vaping advertising campaign promoting the benefits of vaping and dispelling myths (backed up with sources of course)?

        I know a company can’t be seen to be doing this but what about outside that? Say ECITA or someone. Crowd funded or even industry funded as long as there are no brand names attached.

        I for one would volunteer my design and marketing experience into such a endeavour if it’s legally allowed.

        • Roger Hall

          This is certainly needed. Wouldn’t NNA (The Nicotine Alliance) be best placed for this type of campaign as they are a charity and subsequently not industry?

        • Clive Bates

          Hi Dan

          We definitely need a PR offensive, but I’m not sure about a crowd funded ad campaign. ‘National advertising’ is bloody expensive and needs prolonged media weight (i.e a lot of showing over a sustained period) to have much impact. Rather than crowd fund an ad campaign, I think vapers would be better off funding campaigning activity to get a sharp media reaction machine in place and using social media for outreach… It’s better and cheap to have an compelling spokesperson on the news than an ad in a newspaper… it’s just requires some organisation and talent to do it.

          This is why I think building up the New Nicotine Alliance* would be the best way to approach this and a good thing to fund.

          Disclosure: I am an associate. of the NNA – unpaid of course.

        • Guy Eaton

          The really weird aspect is that it appears you are not ‘allowed’ to mention even basic positive facts about E-cigarettes such as they do not contain tar, or CO or that they are far less less toxic and research indicates that are the most effective products on the market to quit. All this is 100% true although you are not permitted to say it on advertisements etc. It is absolutely bizarre and completely undemocratic as information is the currency of democracy. Worse it is killing people right now, let alone the millions of people that will die in the future! If advertisements etc simply provided the most basic facts about EC then most fears would be dispelled and potentially most smokers would cease to use cigarettes eventually. It is as simple as that! Basic information on EC v cigarettes is all a smoker needs to know to switch. Smokers don’t even want a product that is safe just much safer, and one that generally dose not kill you or make you ill when you are alive. The whole EC issue has become completely preposterous. Even more silly is that other products do not have the same high standards and concern surrounding them. This includes food products, alcohol (EC don’t even effect your behaviour) all of which are far more dangerous, and advertised in any way that the manufactures please. Cigarettes and not compared to EC. The whole thing is beyond a joke.

  • Mark Magenis

    Some in the media are beginning to look behind the curtain, as
    the misinformation gets more ludicrous.

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