The Honorable Robert M. Califf, M.D., Commissioner, U.S. Food and Drug Administration (June 28, 2023)

Summary

The House Committee on Small Business writes to Dr. Califf, Commissioner of the U.S. Food and Drug Administration, to inquire about the recent proposed rule to create a product standard for cigars that would result in a product ban of all cigars with a "characterizing flavor" other than tobacco. The letter states that the Committee reviewed the FDA's May 2022 Preliminary Regulatory Impact Analysis and identified several unanswered questions, and requests answers on or before July 12, 2023. The questions ask the FDA to quantify the revenue loss for average small business retailers, estimate how many small businesses will be forced to close, and share data on food deserts and pharmacy deserts. The signature block names Roger Williams and Dan Meuser.

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                                         June 28, 2023

The Honorable Robert M. Califf, M.D.
Commissioner
U.S. Food and Drug Administration
Department of Health and Human Services
10903 New Hampshire Ave.
Silver Spring, MD 20993

Dear Dr. Califf,

        The House Committee on Small Business (Committee) writes to inquire about the recent
proposed rule to create a product standard for cigars that would result in a product ban of all
cigars with a “characterizing flavor” other than tobacco.1 The Committee has followed the Food
and Drug Administration’s (FDA) process as it relates to this rulemaking and seeks to further
understand FDA’s consideration of the economic impacts on small entities that would result
from implementation of this proposed rule.

        Small businesses make up 99.9 percent of all businesses in the United States. This is why
the Regulatory Flexibility Act (RFA) requires regulatory agencies to consider the impact of their
rules on small businesses, and to evaluate alternatives that would accomplish the objectives of
the rule without unduly burdening small entities. We have reviewed the FDA’s May 2022
Preliminary Regulatory Impact Analysis and identified several unanswered questions which we
believe should have been considered when assessing the economic impact of the proposed rule.2
As such, we request answers to the following on or before July 12, 2023:

    1. The analysis indicates that more than 115,000 small business retailers of flavored tobacco
       products will be impacted by the proposed rule.3 Please quantify the revenue loss that
       banning the products under the proposed rule would have on average small business
       retailers by category (such as convenience stores, grocery stores, pharmacies,
       tobacconists, etc.).

    2. Given the revenue loss referenced in question 1, how many small businesses do you
       estimate will be forced to close because of the proposed rule?


1
  87 Fed.Reg. 26396 (May 4, 2022).
2
  DEP’T OF HEALTH & HUMAN SERV., FOOD & DRUG ADMIN., FDA-2021-N-1309, TOBACCO PRODUCT STANDARD
FOR CHARACTERIZING FLAVORS IN CIGARS (May 2022).
3
  Id. at 109.
The Honorable Robert M. Califf, M.D.
June 28, 2023
Page 2 of 2

                  a. What is your estimate on reduced employment figures associated with these small
                     business closures?
                  b. What is your estimate on reduced employment figures for businesses that remain
                     open but with reduced revenues?

       3. Given that many of the small businesses projected to be impacted by the rule are sources
          of food and pharmaceuticals in local communities, what data can the FDA share about
          the effect that the proposed rule will have on “food deserts” and “pharmacy deserts”?

       4. The preliminary analysis only details one alternative — a delayed effective date — to
          minimize the proposed rule’s burden on small businesses.4 What other alternatives has
          the FDA considered or analyzed?

       5. Given the FDA’s expressed interest in the proposed rule’s impact on minority
          communities, what data can the FDA share regarding the effect on minority-owned small
          businesses? Please include data related to the impact on revenue, employment, and
          viability for these businesses.

       To schedule the delivery of your response or ask any related follow-up questions, please
contact Committee on Small Business Majority Staff at (202) 225-5821. The Committee on
Small Business has broad authority to investigate “problems of all types of small business” under
House Rule X. Thank you in advance for your cooperation with this inquiry.”

                                                 Sincerely,




________________________                                 ________________________
Roger Williams                                           Dan Meuser
Chairman                                                 Member
Committee on Small Business                              Committee on Small Business




cc:         The Honorable Nydia M. Velasquez, Ranking Member
            Committee on Small Business




4
    Id. at 112.


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