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The Growth of the Vaping Industry in Indiana After Fall of Monopoly

The Growth of the Vaping Industry in Indiana After Fall of Monopoly



The state of Indiana is showing strong signs of recovery following the retraction of a disastrous vape law that opponents said restricted competition and unfairly awarded a monopoly on e-liquid to a few suppliers.


The law, which took effect July 1, 2016, mandated among other things that any manufacturer wishing to sell in the state of Indiana must be certified by a security firm. The catch? There was only one approved security firm in the country, Mulhaupt's Inc, located in Lafayette. As of June 20, 2016 Mulhaupt's Inc had only approved six producers and said it was in no hurry to add other accounts, virtually eliminating all other competition from the industry in Indiana. Unfair competition allegations arose almost immediately.


The Purpose of the Old Law


The measure was billed as an effort to regulate the vape market, which had been largely left to its own devices to this point. While the bill included some important safety measures that many agreed on, like clean e-liquid production centers and child safety caps, the security component had the effect of unfairly eliminating small e-liquid producers from the market. This was a point of contention and conspiracy theory, why would the government, led by then-governor Mike Pence, want to give so much power to so few companies? A little over a year after the effective date, and with Pence having moved on to higher office, the law has been rescinded.

Recovering from a Struggling Market


As a result, the once-struggling vape market in Indiana once again has some breathing room. Now, over 100 manufacturers are eligible to sell in the state again, compared to the seven that were permitted to while the law was in effect. Since April 27, 2017, when the state's revised measures took effect, 95 companies have applied to the Indiana Alcohol and Tobacco Commission for manufacturing permits. Currently five are pending and none have been denied. Leaders in the industry note that this has been a welcome change, and there has been little to no push back on the new 2017 law.

With the Indiana cartel broken up, consumers in the state are enjoying more choice and lower prices. During the old restrictions, vape users found themselves paying over $25 dollars for a bottle that can be had today for $12.


A Bright Future


Many new startups have seized the opportunity to sell in this market with so few existing competitors. Past e-liquid makers have jumped at the chance to make up for losses they incurred over the past year. Some retailers estimate they lost $10,000 to $20,000 a month during the period the partial manufacturing ban was in effect. Amy Lane, President of the Indiana Smoke Free Alliance, helped lobby for the law fix. Lane credits its cancellation with an influx of high-quality vape suppliers both large and small alike to the Indiana market.


While this is a big step, there will always more that can be done to ensure continued access to vaping and vape accessories. Federal regulations are still in question, and we're definitely not out of the woods as a whole, but every victory should be recognized as such. In retrospect, many spoke out regarding what would happen if the law was put into place last year Had their voices been recognized, this mess could have been prevented. Your voice matters, and law officials are beginning to recognize that. Use your voice to help ensure that individuals have access to vapes.