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Asked by Viscount Ridley

To ask Her Majesty’s Government how much the Medicines and Healthcare Products Regulatory Agency has spent on economic modelling of the price impact of medicinal regulation on consumption of e-cigarettes and tobacco products.[HL3230]

To ask Her Majesty’s Government what forecast the Department of Health has made of the percentage change in (1) the average price, and (2) the level of consumption, of e-cigarettes, as a result of the introduction of medicinal regulation; and how they have derived those figures.[HL3231]

To ask Her Majesty’s Government whether they have made any estimate of the cost of building a manufacturing plant for e-cigarettes that is compliant with the Medicines and Healthcare Products Regulatory Agency's definition of good manufacturing practice; and, if so, what is that estimate.[HL3233]

Earl Howe: The Medicines and Healthcare products Regulatory Agency (MHRA) published on its website an impact assessment (IA) on the regulation of nicotine containing products (NCPs), including electronic cigarettes, on 12 June 2013 which provided estimates of the costs associated with medicinal regulation of NCPs. A copy has been placed in the Library and is available at:

www.mhra.gov.uk/NCPs.

18 Nov 2013 : Column WA172

The IA was prepared by the MHRA and the cost of its production has not been calculated.

The IA does not estimate the cost of achieving Good Manufacturing Practice (GMP). Manufacturing in this sector is almost exclusively conducted outside the European Union and the IA makes the assumption that in the first instance, the foreign manufacturers would bear the costs of achieving GMP. The IA also makes the assumption that any production that might be established within the EU in the future would bear similar costs of achieving relevant manufacturing standards regardless of whether the unlicensed NCPs come into the scope of medicines regulations or not.

The IA makes the assumption that it is likely that manufacturers, EU marketing authorisation holders, and all other participants in the supply chain would seek to pass their incremental costs onto their buyers, and ultimately to consumers. The extent to which United Kingdom consumers would bear the incremental costs is unclear. Pricing of NCPs seems to be constrained at the upper bound by the pricing of tobacco products. The IA suggests that NCP consumers would be unlikely to suffer from substantial price increases if these products were regulated as medicines.

The intention of regulating NCPs under the medicines framework is to ensure that products which meet appropriate standards of safety, quality and efficacy are available to support reducing the harms of smoking to smokers and those around them. The value of the health gains associated with a single successful quit attempt is very substantial — the Department estimates it to be £74,000. The orders of magnitude of estimated compliance costs suggests that a policy of licensing e-cigarettes would have to create very few additional successful quit attempts for the benefits to justify its costs. It is estimated that implementing policies to reduce smoking prevalence by 1% per year for 10 years in the UK would prevent over 57,000 deaths in that period.

A lot of people have claimed that if three countries ban refillable cartridges they will be banned everywhere. This is not true.

If three countries can prove that there is a safety risk with a particular type or brand or cartridge then the European Commission can adopt measures to ban it. BUT, this will only apply to the specific product, not to all of them, AND the European Parliament has the right to veto any such ban.

EU-Montenegro Association Conference - press conference
Wednesday, December 18, 2013 at 13.00