France Raises Tobacco Prices, Driving More Smokers to Vaping Products

“A new survey on smoking by the French Observatory on Drugs and Drug Addiction (OFDT) shows a decline in tobacco sales, but unfortunately that does not equate to a corresponding decrease in smoking rates.

The reason why tobacco sales in France fell was mainly due to the increase in tobacco prices in March last year. However, similar to the situation in other EU member states, the increase in prices did not bring about a relative decrease in smoking rates, but instead attracted problems such as smuggling of tobacco products.

That being said, there are still parts to be happy about in the investigation.

Because the report not only targets sales of tobacco products, but also surveys sales data of alternative tobacco products, and reflects a message that makes public health scholars happy, that is, traditional smokers are more willing to switch to alternative tobacco products due to rising tobacco prices, and this also indirectly confirms that the increase in tobacco prices has a significant impact on tobacco control.
 

The report shows that after the increase in tobacco prices in March 2018, tobacco sales fell by 50,000 tons, which is equivalent to a 10% decrease in market sales. Unfortunately, however, this does not mean that smoking rates have dropped by 10%.

The OFDT investigation cited customs reports showing an increase in tobacco sales near the border, while police sources said imports of tobacco products from Morocco increased.

However, rising tobacco prices have also led to an increase in NRT sales at pharmacies, equivalent to 25% in 2018. More than 49.8% of smokers appear to have switched to nicotine patches, while more than 4.3% use oral nicotine replacement options, while sales of the infamous smoking cessation drug Champix increased by more than 88.4% in 2018.
 

According to the OFDT survey, the number of people using e-cigarette products has remained stable since 2016. However, last summer, France's Vaping Post, together with PGVG Marketing, released exclusive data on the number of e-cigarette stores in France, a survey that showed that the local e-cigarette market is on the road to recovery.

The data clearly shows that an average of more than 300 new stores are expected to open each year. In addition, these physical stores related to the e-cigarette business seem to be doing better than in the past. In fact, compared with previously recorded data, there are many fewer physical stores that have closed down.

Although the French e-cigarette market was hit between 2014 and 2015, as of 2016, it had stabilized and started to grow again. In addition, exclusive data also shows that the increase in the number of e-cigarette physical stores is a clear indicator of the popularity of e-cigarettes in France. In terms of growth rate, France's current market space is very huge, second only to the United Kingdom.
 

Although the growth of e-cigarettes in France is closely related to the rise in tobacco prices, the main reason for their growth is still due to the revised regulations at the end of 2016.

On December 14, 2016, a new e-cigarette decree was issued in the Official Gazette of France, which revised the declaration, review period and product inspection costs for e-cigarette products containing nicotine in the EU TPD application. For e-cigarette practitioners, this not only greatly reduces the cost of opening business, but also reduces the retail price of products purchased by users.

The regulation mentions that for any review or substantial modification, the review fee per product will be reduced from 550 euros to 295 euros, the fee for storage, processing and application for review will be 120 euros per year/product, and the product inspection fee will be adjusted to 120 euros (point 2 of Article L.3512-17).

It can be seen that the reduced review fee and then shared to agents and retail stores have greatly reduced the original product batch cost. Moreover, the regulations also stipulate the annual sales statement of the product at 250 euros, so the burden on the retail side is relatively reduced.

In general, reduced marketing costs and increased tobacco prices have made it easier for traditional French smokers to switch to cigarette replacement products, which is the main reason why the region has been able to steadily develop e-cigarettes after 2016.

Perhaps in the past, France had limited the development of e-cigarettes due to policy factors, allowing tobacco consumption to always be at an advantage. But now, tobacco controls in the region have gradually tightened, and traditional smokers are increasingly aware of alternative cigarette products. High, therefore, as long as the regulations have not changed much and the industry continues to work hard to promote it, I believe that in the future, France will become a fertile place for the development of the European e-cigarette industry.