Prohibition Juice Co. v. U.S. Food & Drug Admin.

• Decision Date: 26 July 2022
• Docket Number: 21-1201,C/w 21-1203, 21-1205, 21-1207
• Citation: 45 F.4th 8
• Parties: PROHIBITION JUICE CO., Petitioner v. UNITED STATES FOOD AND DRUG ADMINISTRATION, Respondent
• Court: U.S. Court of Appeals — District of Columbia Circuit

45 F.4th 8

PROHIBITION JUICE CO., Petitioner

v.UNITED STATES FOOD AND DRUG ADMINISTRATION, Respondent

No. 21-1201

C/w 21-1203, 21-1205, 21-1207

United States Court of Appeals, District of Columbia Circuit.

Argued April 21, 2022

Decided July 26, 2022

Jerad Wayne Najvar argued the cause and filed the briefs for petitioners.

J. Gregory Troutman was on the brief for amici curiae 36 National and State Electronic Nicotine Delivery System Product Advocacy Associations in support of petitioners.

Scott P. Kennedy, Trial Attorney, U.S. Department of Justice, argued the cause for respondent. With him on the brief were Brian M. Boynton, Principal Deputy Assistant Attorney General, and Hilary K. Perkins, Assistant Director. Courtney Dixon, Kathleen Gilchrist, Alisa B. Klein, Joshua M. Koppel, and Lindsey Powell, Attorneys, entered appearances.

William B. Schultz and Andrew N. Goldfarb were on the brief for amici curiae Medical and Public Health Groups in support of respondent.

Before: Henderson, Pillard, and Katsas, Circuit Judges.

Concurring opinion filed by Circuit Judge Katsas.

Pillard, Circuit Judge:

More than 3.6 million young people in the United States reported using e-cigarettes in 2020, including nearly one in five high school students. That makes e-cigarettes "the most widely used tobacco product among youth by far." FDA, Technical Project Lead (TPL) Review of PMTAs (2021) (FDA Technical Review), at 6. The public health consequences are dire: Tobacco is quickly and powerfully addicting, and e-cigarettes can permanently damage developing adolescent brains, cause chronic lung diseases

, and hook young users for life. Given the scale and severity of the problem, by 2018 the Surgeon General had already decried an "epidemic" of youth e-cigarette use.¹ And the FDA declared in 2021 that "preventing tobacco use initiation in young people is a central priority for protecting population health." FDA Technical Review at 6.

Flavored tobacco products lie at the heart of the problem. A vast body of scientific evidence shows that flavors encourage youth to try e-cigarettes and, together with the nicotine, keep them coming back. With names like Brain Freeze Caramel Cone, Crazy Bubble Grape, and Green Apple Gummy Guts, flavors play a "fundamental role" in driving youth interest in e-cigarette use. FDA Technical Review at 8. The FDA has concluded that the availability of flavored products "is one of the primary reasons for the popularity of [e-cigarettes] among youth." Id. at 6.

Congress has called on the FDA to regulate e-cigarette products pursuant to the Family Smoking Prevention and Tobacco Control Act, Pub. L. No. 111-31, 123 Stat. 1776 (2009) (Tobacco Control Act or Act). Under the Act, manufacturers must apply for FDA authorization to sell new tobacco products, which the FDA grants only if it determines that doing so would be "appropriate for the protection of the public health." 21 U.S.C. § 387j(c)(2)(A). The agency makes that determination by weighing, on a population-wide basis, any benefits of such products against their harms. Id. § 387j(c)(4).

Prohibition Juice makes flavored liquids containing nicotine derived from tobacco, which it sells for use in e-cigarettes, or Electronic Nicotine Delivery Systems (ENDS). Along with the three other e-liquid manufacturer petitioners, Prohibition applied in September 2020 for FDA authorization to market several flavors in a range of sizes. The FDA denied those applications a year later.² In view of flavored tobacco products’ serious, well-documented, and lasting risks to youth, the FDA requires applicants to present reliable evidence of robust public health benefits exceeding known risks. The manufacturers describe their products as a beneficial alternative to combustible cigarettes that offer comparative health benefits to existing smokers. Finding the manufacturers had presented insufficient evidence that their flavored products are more effective than unflavored products in helping adult cigarette smokers decrease or quit harmful tobacco uses, the FDA denied the applications.

The manufacturers petition for review of those denials. They first argue that the FDA lacked statutory authority to require that parties establish that their flavored liquids carry greater public health benefits than unflavored liquids. They also challenge the application denials as arbitrary and capricious, asserting that the FDA (1) departed from an earlier guidance document, changing both the types of evidence the agency would accept and the substantive showing it expected parties to make; (2) underscored the potential importance of marketing plans including measures to limit youth access to their products but then failed to consider the plans petitioners submitted; and (3) overlooked various other aspects of the problem.

We deny the petitions for review. The FDA plainly had statutory authority under the Tobacco Control Act to regulate as it did. As to the arbitrary and capricious challenges, we hold that the FDA did not change the evidentiary or substantive standard from its 2019 Guidance. We also hold that any error in the FDA's failure to consider the marketing plans was harmless because the manufacturers failed to identify how individualized review of the plans they submitted could have made any difference. Finally, the FDA did not otherwise fail to consider important aspects of the problem. We accordingly deny the petitions for review.

I. BACKGROUND

A. Statutory Background

In 2009, Congress enacted the Tobacco Control Act to regulate the sale of tobacco products. Pub. L. No. 111-31, 123 Stat. 1776. Congress concluded that the "use of tobacco products by the Nation's children is a pediatric disease

of considerable proportions that results in new generations of tobacco-dependent children and adults." Id. § 2, 123 Stat. at 1777. We canvassed the history of the Tobacco Control Act in Nicopure Labs, LLC v. FDA , 944 F.3d 267 (D.C. Cir. 2019), where we recounted that Congress acted based on extensive evidence that tobacco is widely used, highly addictive, and destructive of human health. See

id. at 270-79. The enacting Congress knew that kids are key: The FDA had already shown that the vast majority of adults who smoke have their first cigarette before the age of 18, and that "[v]irtually all new users of tobacco products are under the minimum legal age to purchase such products." Id . at 272 (quoting the Tobacco Control Act, Pub. L. No. 111-31, §§ 2(3), (4), 123 Stat. at 1777 (alteration in original)). Businesses seeking to make a profit selling tobacco products know that, too, and face powerful economic incentives to reach younger customers. A core objective of the Tobacco Control Act is to "ensure" tobacco products will not be "sold or accessible to underage purchasers." Pub. L. No. 111-31, § 3(7), 123 Stat. at 1782.

Under the Act, a "new tobacco product" may not be marketed in interstate commerce unless the manufacturer obtains premarket authorization from the FDA. 21 U.S.C. § 387j(a)(1)-(2). The FDA in turn "shall deny" an application to market a new tobacco product unless the agency finds "that permitting such tobacco product to be marketed would be appropriate for the protection of the public health." Id. § 387j(c)(2). The statute explains how the FDA is to determine whether approving a product is, on balance, appropriate for the protection of public health:

For purposes of this section, the finding as to whether the marketing of a tobacco product for which an application has been submitted is appropriate for the protection of the public health shall be determined with respect to the risks and benefits to the population as a whole, including users and nonusers of the tobacco product, and taking into account—

(A) the increased or decreased likelihood that existing users of tobacco products will stop using such products; and

(B) the increased or decreased likelihood that those who do not use tobacco products will start using such products.

Id. § 387j(c)(4)(A)-(B).

That statutory directive reflects the fact that tobacco is highly addictive and generally harmful to human health. Proof that a new tobacco product has public health benefit thus depends on favorable substitution effects, such as evidence that the new product is less harmful to existing users than current products, and that it either draws existing users away from the more harmful tobacco products or helps them to quit altogether. Any such benefit must be shown to offset the product's public health harms to new users, including youth.

The statute also directs manufacturers to include in their applications "full reports of all information ... concerning investigations which have been made to show the health risks of such tobacco product and whether such tobacco product presents less risk than other tobacco products." Id. § 387j(b)(1)(A). The Act grandfathered tobacco products on the market as of February 15, 2007, excusing them from the premarket authorization requirement. Id. § 387j(a)(1). But no product brought to market after that date may lawfully be sold unless and until it receives FDA premarket authorization.

B. Regulatory Background

Electronic cigarettes subject to the Tobacco Control Act deliver nicotine to their users by vaporizing a liquid derived from tobacco. See Nicopure Labs , 944 F.3d at 270, 272. These devices are either disposable (closed) or refillable (open). Open systems are refilled either by inserting a pod or cartridge containing the liquid into the device or by manually pouring in the liquid. For current purposes, the liquids inside those devices are treated as either non-flavored, meaning they taste like tobacco, or as flavored because they carry a distinctive, often sweet, flavoring. Flavored liquids are the subject of this challenge. The FDA is separately addressing applications for menthol-flavored devices, see FDA Technical Review at 3 n.ii, and is re-evaluating whether it mistakenly included some tobacco- and menthol-flavored...