Who’s Responsible for Curbing the Teen Vaping Epidemic?
A teenage girl vaping in a park.
E-cigarettes are big business. In 2017, American consumers bought more than $250 million in vapes and juice-filled pods, and spent $1 billion in 2018. By 2023, the global market could be worth $44 billion a year.
"My nine-year-old actually knows what Juuling is. In many cases the [school] bathroom is now referred to as 'the Juuling room.'"
Investors are trying to capitalize on the phenomenal growth. In July 2018, Juul Labs, the company that owns 70 percent of the U.S. e-cigarette market share, raised $1.25 billion at a $16 billion valuation, then sold a 35 percent stake to Phillip Morris USA owner Altria Group in December. The second transaction valued the company at $38 billion. While the traditional tobacco market remains much larger, it's projected to grow at less than two percent a year, making the attractiveness of the rapidly expanding e-cigarette market obvious.
While Juul and other e-cigarette manufacturers argue that their products help adults quit smoking – and there's some research to back this narrative up – much of the growth has been driven by children and teenagers. One CDC study showed a 48 percent rise in e-cigarette use by middle schoolers and a 78 percent increase by high schoolers between 2017 and 2018, a jump from 1.5 million kids to 3.6 million. In response to the study, F.D.A. Commissioner Scott Gottlieb said, "We see clear signs that youth use of electronic cigarettes has reached an epidemic proportion."
Another study found that teenagers between 15 and 17 were 16 times more likely to use Juul than people aged 25-34. In December, Surgeon General Jerome Adams said, "My nine-year-old actually knows what Juuling is. In many cases the [school] bathroom is now referred to as 'the Juuling room.'"
And the product is seriously addictive. A single Juul pod contains as much nicotine as a pack of 20 regular cigarettes. Considering that 90 percent of smokers are addicted by 18 years old, it's clear that steps need to be taken to combat the growing epidemic.
But who should take the lead? Juul and other e-cigarette companies? The F.D.A. and other government regulators? Schools? Parents?
The Surgeon General's website has a list of earnest possible texts that parents can send to their teens to dissuade them from Juuling, like: "Hope none of your friends use e-cigarettes around you. Even breathing the cloud they exhale can expose you to nicotine and chemicals that can be dangerous to your health." While parents can attempt to police their teens, many experts believe that the primary push should come at a federal level.
The regulation battle has already begun. In September, the F.D.A. announced that Juul had 60 days to show a plan that would prevent youth from getting their hands on the product. The result was for the company to announce that it wouldn't sell flavored pods in retail stores except for tobacco, menthol, and mint; Juul also shuttered its Instagram and Facebook accounts. These regulations mirrored an F.D.A. mandate two days later that required flavored e-cigarettes to be sold in closed-off areas. "This policy will make sure the fruity flavors are no longer accessible to kids in retail sites, plan and simple," Commissioner Gottlieb said when announcing the moves. "That's where they're getting access to the e-cigs and we intend to end those sales."
"There isn't a great history of the tobacco industry acting responsibly and being able to in any way police itself."
While so far, Gottlieb – who drew concerns about conflict of interest due to his past position as a board member at e-cigarette company, Kure – has pleased anti-smoking advocates with his efforts, some observers also argue that it needs to go further. "Overall, we didn't know what to expect when a new commissioner came in, but it's been quite refreshing how much attention has been paid to the tobacco industry by the F.D.A.," Robin Koval, CEO and president of Truth Initiative, said a day after the F.D.A. announced the proposed regulations. "It's important to have a start. I certainly want to give credit for that. But we were really hoping and feel that what was announced...doesn't go far enough."
The issue is the industry's inability or unwillingness to police itself in the past. Juul, however, claims that it's now proactively working to prevent young people from taking up its product. "Juul Labs and F.D.A. share a common goal – preventing youth from initiating on nicotine," a company representative said in an email. "To paraphrase Commissioner Gottlieb, we want to be the off-ramp for adult smokers to switch from cigarettes, not an on-ramp for America's youth to initiate on nicotine. We won't be successful in our mission to serve adult smokers if we don't narrow the on-ramp... Our intent was never to have youth use Juul products. But intent is not enough, the numbers are what matter, and the numbers tell us underage use of e-cigarette products is a problem. We must solve it."
Juul argues that its products help adults quit – even offering a calculator on the website showing how much people will save – and that it didn't target youth. But studies show otherwise. Furthermore, the youth smoking prevention curriculum the company released was poorly received. "It's what Philip Morris did years ago," said Bonnie Halpern-Felsher, a professor of pediatrics at Stanford who helped author a study on the program's faults. "They aren't talking about their named product. They are talking about vapes or e-cigarettes. Youth don't consider Juuls to be vapes or e-cigarettes. [Teens] don't talk about flavors. They don't talk about marketing. They did it to look good. But if you look at what [Juul] put together, it's a pretty awful curriculum that was put together pretty quickly."
The American Lung Association gave the FDA an "F" for failing to take mint and menthol e-cigs off the market, since those flavors remain popular with teens.
Add this all up, and in the end, it's hard to see the industry being able to police itself, critics say. Neither the past examples of other tobacco companies nor the present self-imposed regulations indicate that this will succeed.
"There isn't a great history of the tobacco industry acting responsibly and being able to in any way police itself," Koval said. "That job is best left to the F.D.A., and to the states and localities in what they can regulate and legislate to protect young people."
Halpern-Felsher agreed. "I think we need independent bodies. I really don't think that a voluntary ban or a regulation on the part of the industry is a good idea, nor do I think it will work," she said. "It's pretty much the same story, of repeating itself."
Just last week, the American Association of Pediatrics issued a new policy statement calling for the F.D.A. to immediately ban the sale of e-cigarettes to anyone under age 21 and to prohibit the online sale of vaping products and solutions, among other measures. And in its annual report, the American Lung Association gave the F.D.A. an "F" for failing to take mint and menthol e-cigs off the market, since those flavors remain popular with teens.
Few, if any people involved, want more regulation from the federal government. In an ideal world, this wouldn't be necessary. But many experts agree that it is. Anything else is just blowing smoke.
Breakthrough therapies are breaking patients' banks. Key changes could improve access, experts say.
Single-treatment therapies are revolutionizing medicine. But insurers and patients wonder whether they can afford treatment and, if they can, whether the high costs are worthwhile.
CSL Behring’s new gene therapy for hemophilia, Hemgenix, costs $3.5 million for one treatment, but helps the body create substances that allow blood to clot. It appears to be a cure, eliminating the need for other treatments for many years at least.
Likewise, Novartis’s Kymriah mobilizes the body’s immune system to fight B-cell lymphoma, but at a cost $475,000. For patients who respond, it seems to offer years of life without the cancer progressing.
These single-treatment therapies are at the forefront of a new, bold era of medicine. Unfortunately, they also come with new, bold prices that leave insurers and patients wondering whether they can afford treatment and, if they can, whether the high costs are worthwhile.
“Most pharmaceutical leaders are there to improve and save people’s lives,” says Jeremy Levin, chairman and CEO of Ovid Therapeutics, and immediate past chairman of the Biotechnology Innovation Organization. If the therapeutics they develop are too expensive for payers to authorize, patients aren’t helped.
“The right to receive care and the right of pharmaceuticals developers to profit should never be at odds,” Levin stresses. And yet, sometimes they are.
Leigh Turner, executive director of the bioethics program, University of California, Irvine, notes this same tension between drug developers that are “seeking to maximize profits by charging as much as the market will bear for cell and gene therapy products and other medical interventions, and payers trying to control costs while also attempting to provide access to medical products with promising safety and efficacy profiles.”
Why Payers Balk
Health insurers can become skittish around extremely high prices, yet these therapies often accompany significant overall savings. For perspective, the estimated annual treatment cost for hemophilia exceeds $300,000. With Hemgenix, payers would break even after about 12 years.
But, in 12 years, will the patient still have that insurer? Therein lies the rub. U.S. payers, are used to a “pay-as-you-go” model, in which the lifetime costs of therapies typically are shared by multiple payers over many years, as patients change jobs. Single treatment therapeutics eliminate that cost-sharing ability.
"As long as formularies are based on profits to middlemen…Americans’ healthcare costs will continue to skyrocket,” says Patricia Goldsmith, the CEO of CancerCare.
“There is a phenomenally complex, bureaucratic reimbursement system that has grown, layer upon layer, during several decades,” Levin says. As medicine has innovated, payment systems haven’t kept up.
Therefore, biopharma companies begin working with insurance companies and their pharmacy benefit managers (PBMs), which act on an insurer’s behalf to decide which drugs to cover and by how much, early in the drug approval process. Their goal is to make sophisticated new drugs available while still earning a return on their investment.
New Payment Models
Pay-for-performance is one increasingly popular strategy, Turner says. “These models typically link payments to evidence generation and clinically significant outcomes.”
A biotech company called bluebird bio, for example, offers value-based pricing for Zynteglo, a $2.8 million possible cure for the rare blood disorder known as beta thalassaemia. It generally eliminates patients’ need for blood transfusions. The company is so sure it works that it will refund 80 percent of the cost of the therapy if patients need blood transfusions related to that condition within five years of being treated with Zynteglo.
In his February 2023 State of the Union speech, President Biden proposed three pilot programs to reduce drug costs. One of them, the Cell and Gene Therapy Access Model calls on the federal Centers for Medicare & Medicaid Services to establish outcomes-based agreements with manufacturers for certain cell and gene therapies.
A mortgage-style payment system is another, albeit rare, approach. Amortized payments spread the cost of treatments over decades, and let people change employers without losing their healthcare benefits.
Only about 14 percent of all drugs that enter clinical trials are approved by the FDA. Pharma companies, therefore, have an exigent need to earn a profit.
The new payment models that are being discussed aren’t solutions to high prices, says Bill Kramer, senior advisor for health policy at Purchaser Business Group on Health (PBGH), a nonprofit that seeks to lower health care costs. He points out that innovative pricing models, although well-intended, may distract from the real problem of high prices. They are attempts to “soften the blow. The best thing would be to charge a reasonable price to begin with,” he says.
Instead, he proposes making better use of research on cost and clinical effectiveness. The Institute for Clinical and Economic Review (ICER) conducts such research in the U.S., determining whether the benefits of specific drugs justify their proposed prices. ICER is an independent non-profit research institute. Its reports typically assess the degrees of improvement new therapies offer and suggest prices that would reflect that. “Publicizing that data is very important,” Kramer says. “Their results aren’t used to the extent they could and should be.” Pharmaceutical companies tend to price their therapies higher than ICER’s recommendations.
Drug Development Costs Soar
Drug developers have long pointed to the onerous costs of drug development as a reason for high prices.
A 2020 study found the average cost to bring a drug to market exceeded $1.1 billion, while other studies have estimated overall costs as high as $2.6 billion. The development timeframe is about 10 years. That’s because modern therapeutics target precise mechanisms to create better outcomes, but also have high failure rates. Only about 14 percent of all drugs that enter clinical trials are approved by the FDA. Pharma companies, therefore, have an exigent need to earn a profit.
Skewed Incentives Increase Costs
Pricing isn’t solely at the discretion of pharma companies, though. “What patients end up paying has much more to do with their PBMs than the actual price of the drug,” Patricia Goldsmith, CEO, CancerCare, says. Transparency is vital.
PBMs control patients’ access to therapies at three levels, through price negotiations, pricing tiers and pharmacy management.
When negotiating with drug manufacturers, Goldsmith says, “PBMs exchange a preferred spot on a formulary (the insurer’s or healthcare provider’s list of acceptable drugs) for cash-base rebates.” Unfortunately, 25 percent of the time, those rebates are not passed to insurers, according to the PBGH report.
Then, PBMs use pricing tiers to steer patients and physicians to certain drugs. For example, Kramer says, “Sometimes PBMs put a high-cost brand name drug in a preferred tier and a lower-cost competitor in a less preferred, higher-cost tier.” As the PBGH report elaborates, “(PBMs) are incentivized to include the highest-priced drugs…since both manufacturing rebates, as well as the administrative fees they charge…are calculated as a percentage of the drug’s price.
Finally, by steering patients to certain pharmacies, PBMs coordinate patients’ access to treatments, control patients’ out-of-pocket costs and receive management fees from the pharmacies.
Therefore, Goldsmith says, “As long as formularies are based on profits to middlemen…Americans’ healthcare costs will continue to skyrocket.”
Transparency into drug pricing will help curb costs, as will new payment strategies. What will make the most impact, however, may well be the development of a new reimbursement system designed to handle dramatic, breakthrough drugs. As Kramer says, “We need a better system to identify drugs that offer dramatic improvements in clinical care.”
In today's podcast episode, law professor Gaia Bernstein talks about the challenges of keeping control over our thoughts and actions, even when some powerful forces are pushing in the other direction.
Each afternoon, kids walk through my neighborhood, on their way back home from school, and almost all of them are walking alone, staring down at their phones. It's a troubling site. This daily parade of the zombie children just can’t bode well for the future.
That’s one reason I felt like Gaia Bernstein’s new book was talking directly to me. A law professor at Seton Hall, Gaia makes a strong argument that people are so addicted to tech at this point, we need some big, system level changes to social media platforms and other addictive technologies, instead of just blaming the individual and expecting them to fix these issues.
Gaia’s book is called Unwired: Gaining Control Over Addictive Technologies. It’s fascinating and I had a chance to talk with her about it for today’s podcast. At its heart, our conversation is really about how and whether we can maintain control over our thoughts and actions, even when some powerful forces are pushing in the other direction.
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We discuss the idea that, in certain situations, maybe it's not reasonable to expect that we’ll be able to enjoy personal freedom and autonomy. We also talk about how to be a good parent when it sometimes seems like our kids prefer to be raised by their iPads; so-called educational video games that actually don’t have anything to do with education; the root causes of tech addictions for people of all ages; and what kinds of changes we should be supporting.
Gaia is Seton’s Hall’s Technology, Privacy and Policy Professor of Law, as well as Co-Director of the Institute for Privacy Protection, and Co-Director of the Gibbons Institute of Law Science and Technology. She’s the founding director of the Institute for Privacy Protection. She created and spearheaded the Institute’s nationally recognized Outreach Program, which educated parents and students about technology overuse and privacy.
Professor Bernstein's scholarship has been published in leading law reviews including the law reviews of Vanderbilt, Boston College, Boston University, and U.C. Davis. Her work has been selected to the Stanford-Yale Junior Faculty Forum and received extensive media coverage. Gaia joined Seton Hall's faculty in 2004. Before that, she was a fellow at the Engelberg Center of Innovation Law & Policy and at the Information Law Institute of the New York University School of Law. She holds a J.S.D. from the New York University School of Law, an LL.M. from Harvard Law School, and a J.D. from Boston University.
Gaia’s work on this topic is groundbreaking I hope you’ll listen to the conversation and then consider pre-ordering her new book. It comes out on March 28.
