Are you an online tobacco retailer? Then you may be subject to steep FDA penalties if your tobacco products are not compliant with the FD&C Act. Last year, six online retailers received warning letters from the FDA for selling “across state lines a tobacco product subject to a Not Substantially Equivalent (NSE) Order.” If your business receives this letter, your products will be deemed “misbranded and adulterated,” and won’t be eligible for sale on the market. Unfortunately too many tobacco retailers are unaware of the status of their products. This could mean that their tobacco is at risk of being in violation of the FD&C Act.
The FDA issues a NSE order when a retailer’s SE Report does not have enough information to indicate that a specific product is substantially equivalent to a predicate tobacco item. Once a retailer receives a NSE Order, it is illegal to sell, distribute, or import their tobacco product in the United States. If the retailer continues to distribute the product, they are subject to seizures and injunctions.
Navigating the complex world of the FD&C Act in relation to the online sale of tobacco can be tricky, which means that many businesses can be cited without knowing why. If your online tobacco business has received a NSE Order, you may be spared harsh penalties like injunction and monetary punishment, by taking swift and corrective action.
The FDA does recognize that many retailers will lose significant sums of money by disposing of all of their inventory. Therefore the FDA draft guidance, called, “Enforcement Policy for Certain (“Provisional”) Tobacco Products that FDA Finds Not Substantially Equivalent ,” states that the FDA will wait to take enforcement action for 30 calendar days from the date the NSE order is issued. During this 30 day period, retailers should contact their manufacturers or suppliers to discuss options for affected products in their current inventory.
If you have an online tobacco company, it is important to maintain compliance in every way. This includes ensuring that your online tobacco merchant account is properly managed and protected for you and your customers.