The new constitutional framework

Both circuits applied the framework established in the Supreme Court’s 2022 New York State Rifle & Pistol Ass’n v. Bruen decision, which requires the government to demonstrate that firearm regulations are “consistent with this Nation’s historical tradition of firearm regulation.” This standard has proven particularly challenging for the federal prohibition on gun ownership by marijuana users under 18 U.S.C. § 922(g)(3), as courts struggle to find historical analogues that justify disarming an entire class of people based solely on their substance use.

The 10th Circuit’s decision in Harrison is noteworthy because it involved illegal recreational marijuana use rather than state-legalized medical use. The case involved a defendant who was pulled over for running a red light in Oklahoma. The defendant was sober, but police smelled marijuana, searched his car, and found a loaded revolver plus various marijuana products, which led to a federal charge of firearm possession by an unlawful drug user. Despite clearly illegal marijuana possession, the court concluded that the government must individually prove that non-intoxicated marijuana users “pose a risk of future danger” rather than simply assuming all marijuana users are categorically dangerous. The case was sent back to the District Court for the Western District of Oklahoma with new criteria for conviction and represents a dramatic departure from the previous approach of treating drug use as an automatic disqualifier for Second Amendment rights.

The 11th Circuit went even further in the Florida case, which involved two plaintiffs who were registered medical marijuana patients who were denied gun purchases and one more who was a gun owner who wanted to use medical marijuana but feared prosecution. All of the plaintiffs sued the federal government to challenge its prohibition. Although the District Court for the Northern District of Florida dismissed the case reflexively, the 11th Circuit sent it back on appeal, explicitly rejecting two of the government’s most common historical analogies. 

First, the court ruled that medical marijuana patients could not be compared to convicted felons because the plaintiffs had never been convicted of any crime—at most, two were committing a federal misdemeanor through marijuana possession. Crucially, the court noted that there is no historical tradition of categorically disarming misdemeanants, and that felony dispossessions require a judicial determination of guilt before stripping Second Amendment rights. (Note that  misdemeanors regarding violent acts like domestic violence can categorically disqualify gun ownership.)

Second, the court also rejected the “dangerous individuals” analogy, finding that the complaint contained no allegations about frequency of use, side effects, or impaired judgment. Instead, the medical marijuana patients in the case appeared to “use rational thought in making their decision to use marijuana and would stop their marijuana use if they were placed at risk of criminal prosecution.” This rational, controlled use was “a far cry from that of addicts and alcoholics whose actions are controlled by their need to use alcohol or drugs.” The court emphasized that these patients were participating in Florida’s highly regulated medical marijuana program, not engaging in illegal drug trafficking, and posed no “credible threat” to public safety.

Individualized assessments replace categorical bans

What emerges from these decisions is a requirement for individualized factual determinations rather than sweeping categorical prohibitions. As the 11th Circuit noted, while the government “very well may prove at a later stage of litigation, after development of a factual record, that Appellants can fairly be considered relevantly similar to felons or dangerous individuals,” such determinations cannot be made based on marijuana use alone. 

However, the Supreme Court has communicated that lower courts can uphold firearm regulations when individualized danger is present. In United States v. Rahimi, decided in 2024, the Supreme Court held that an individual who is a credible threat may have their firearms temporarily confiscated without a trial. This shift, following Bruen and Rahimi, does not give blanket protections to marijuana users, but it has led courts to assess whether specific individuals pose actual risks rather than relying on legislative assumptions. Although these rulings align with a recent decision from the Third Circuit, the Eighth Circuit has been much more nuanced, saying gun prohibitions for substance users are not “facially unconstitutional” and can be broadly applied to all felons. These inconsistencies between Circuit court jurisprudence may soon compel the Supreme Court to take up this issue.

The commandeering problem

These judicial developments occur against a backdrop of practical enforcement challenges that further complicate federal marijuana prohibition. The anti-commandeering doctrine, rooted in the 1997 Supreme Court decision Printz v. United States, prevents the federal government from compelling state and local officials to enforce federal law. This constitutional limitation creates significant enforcement gaps in areas where federal agencies lack sufficient resources.

Unlike pharmaceutical regulation, where the Food and Drug Administration (FDA) can effectively monitor a relatively small number of manufacturers and distributors, marijuana prohibition requires extensive state and local police powers to investigate, arrest, and prosecute individual users and small-scale distributors. Regarding firearms, many, if not the majority, of firearm transfers happen between private individuals without background checks or federal firearms licenses (FFLs), and are not monitored by the federal government. The federal government can say that gun transfers to marijuana users are illegal among private individuals, but it cannot force a state to enforce that law, and the federal government lacks the personnel and resources to enforce the prohibition without state cooperation.

In these cases, there was no commandeering challenge. But it is notable that in the 10th Circuit case, Oklahoma was attempting to enforce federal law on recreational possession when the state does not enforce federal law for medical marijuana use. Florida has a similar arrangement with its marijuana laws. As states have increasingly legalized medical and recreational marijuana, they have withdrawn this crucial enforcement support. The Rohrabacher-Farr Amendment, referenced in the 11th Circuit’s decision, also explicitly prohibits the Department of Justice from using federal funds to interfere with state medical marijuana programs, further constraining federal enforcement capabilities.

A changing legal landscape

The combination of heightened constitutional scrutiny and practical enforcement limitations is creating a perfect storm for federal marijuana prohibition. Courts are demanding individualized proof of danger before stripping citizens of gun rights, while states are refusing to provide the enforcement mechanisms necessary for effective prohibition. The result is a patchwork system where federal law remains technically supreme but practically unenforceable in many jurisdictions.

These developments suggest that categorical federal restrictions on marijuana users’ constitutional rights are becoming increasingly untenable. As more circuits require individualized assessments and more states legalize marijuana, the gap between federal prohibition and practical reality will likely continue to widen, potentially forcing either legislative reform or executive action to resolve these fundamental tensions. However, gun owners should understand that, as of now, their guns will likely be confiscated if they are caught possessing marijuana.

The post An evolving legal landscape for marijuana and firearms appeared first on Reason Foundation.

Berg’s piece cleverly presents technically true claims that lack critical context, creating a distorted picture of e-cigarettes’ role in public health. This obscuration ignores the reality that e-cigarettes are a vital tool for adult smokers seeking to quit traditional combustible cigarettes. Consider some specific claims from the AMA’s interview to highlight the gaps between their narrative and the evidence:

Claim 1: “E-cigarettes, once marketed as a safer alternative to smoking, have found a stronghold among teens and adults alike.”

This opening statement implies that e-cigarettes are no longer considered a safer alternative to smoking, but it stops short of making that claim explicitly—it’s a subtle inference designed to mislead. The truth is, e-cigarettes are still widely recognized as safer than smoking. Back in 2015, Public Health England published a landmark review that concluded e-cigarettes are approximately 95% less harmful than combustible cigarettes. Recently, King’s College London reaffirmed this observation, arguing that “vaping products rather than smoking leads to a substantial reduction in exposure to toxicants that promote cancer, lung disease and cardiovascular disease.” By omitting this context, the AMA avoids an outright lie while ignoring inconvenient facts.

The claim of a “stronghold among teens and adults alike” is equally misleading. First, youth nicotine use is at an all-time low, as evidenced by the 2024 National Youth Tobacco Survey (NYTS), which reported a decline in e-cigarette use among high school students from 10% in 2023 to 7.8% in 2024. Second, while e-cigarette use among adults has risen, overall adult nicotine use has remained stable since 2017, according to a CDC review of the National Health Interview Survey (NHIS). Meanwhile, cigarette smoking among adults fell to a record low of 11% in 2024, which suggests that adult smokers are switching to e-cigarettes without a significant increase in new nicotine users—a public health victory the AMA fails to acknowledge.

Claim 2: “While vape use went down between 2023 and 2024, for the 11th year in a row, e-cigarettes have been the most commonly used tobacco product among middle- and high-school students…”

The AMA highlights the decline in youth vaping between 2023 and 2024 but omits the broader trend: youth e-cigarette use has dropped nearly every year since 2019. By focusing on e-cigarettes as the “most commonly used tobacco product” among youth, the AMA distracts from the fact that overall youth nicotine use is at a historic low. The 2024 NYTS reported that only 10.1% of high school and 5.9% of middle school students currently used any tobacco products in 2024, a significant decline from previous years that should be celebrated. Indeed, current cigarette smoking among many youth demographics, such as black high school students, is now so low that it’s statistically indistinguishable from zero.

Claim 3: “Vaping not shown to help you quit… No e-cigarettes or vapes have been found to be safe and effective by the Food and Drug Administration (FDA) in helping smokers quit…”

It’s true that the FDA has not approved any e-cigarette as a safe and effective smoking cessation tool—but this is a regulatory failure, not a reflection of the science. The science is clear: E-cigarettes do help smokers quit. An ongoing review by Cochrane Library that was updated this year found that nicotine e-cigarettes are much more effective than all of the traditional nicotine replacement therapies that are FDA-approved, like patches or gums. Such observations motivated a 2024 editorial in The New England Journal of Medicine, which urged the medical community to “add e-cigarettes to the smoking-cessation toolkit,” highlighting the overwhelming scientific evidence that they can save lives.

The burdensome regulations that the FDA has arbitrarily produced have made it nearly impossible for e-cigarette manufacturers to make cessation claims, as none have yet to successfully navigate the process. The FDA has barely approved any e-cigarettes to be legally sold (PMTA), and none to be advertised as modified risk products (MRTP). This regulatory framework prevents e-cigarette manufacturers from disclosing truthful information about their products, which prevents smokers from knowing that they can switch to a less harmful alternative—a consequence the AMA fails to address. Some legal scholars and I argue that these laws violate free speech protections under the First Amendment.

Claim 4: “Using any other tobacco product or any other product that contains nicotine is not actually quitting.”

Dr. Bangash’s assertion that vaping isn’t “quitting” because it involves nicotine misses the point of harm reduction. The goal of switching to e-cigarettes isn’t necessarily to end nicotine use but to reduce health risks. While long-term data on e-cigarette use is still emerging, early studies are promising. A 2017 study in the Annals of Internal Medicine found that former smokers who switched to e-cigarettes had significantly lower levels of carcinogens in their saliva and urine compared to current smokers. And a 2018 study published by the AMA itself noted that within a year of switching to e-cigarettes, former smokers’ blood carcinogen levels were nearly indistinguishable from those of never-smokers.

The benefits are particularly striking for vulnerable populations, such as pregnant women. Smoking during pregnancy is well-known to cause adverse outcomes like low birth weight and miscarriage. However, a 2019 presentation published by the American Journal of Obstetrics & Gynecology found that babies born to mothers who exclusively used e-cigarettes during pregnancy were nearly indistinguishable in health outcomes from those born to nonsmokers. Leading publications, including The Lancet’s EClinicalMedicine, have replicated these results multiple times. By dismissing vaping as “not quitting,” the AMA overlooks significant harm-reduction benefits for both adults and children.

A call for nuance and honesty

Perhaps most troubling is the AMA’s failure to encourage adult smokers to switch to vaping. In 2023, the CDC reported that 24.3 million U.S. adults still smoked combustible cigarettes, contributing to approximately 447,000 smoking-related deaths that year. Such circumstances have motivated The New England Journal of Medicine to issue an editorial calling on clinicians to recommend e-cigarettes to smokers in appropriate situations, emphasizing the potential to save lives through harm reduction. Yet the AMA’s focus on youth vaping—despite declining rates—overshadows this urgent need, perpetuating a narrative of fear rather than opportunity.

The AMA should be a beacon of scientific integrity, not a purveyor of misleading narratives. Instead of obscuring reality, the AMA should foster a nuanced discussion about the competing interests of promoting e-cigarette use among adult smokers while minimizing youth exposure to nicotine. E-cigarettes are not risk-free, but they are a proven tool for reducing the harm caused by smoking—a fact supported by decades of research. By ignoring this reality, the AMA undermines public health and misses a critical opportunity to save lives.

The post The AMA’s misleading narrative on vaping harms public health appeared first on Reason Foundation.

The executive order signed on May 12 seeks to reintroduce the most favored nations (MFN) reimbursement model, which was originally formalized during Trump’s first administration. The idea of MFN is to peg prescription reimbursements from the Centers for Medicare and Medicaid Services (CMS) to a basket of drug prices paid by foreign countries, which typically pay much less than the U.S. does. As I wrote for Discourse Magazine last year, the policy has tradeoffs, but it is clearly a win for limited government.

The primary issue with the current reimbursement model is that public reimbursements set private prices, not the reverse, as designed. Medicaid, Medicare Part B, and some aspects of Medicare Part D currently match private prices in the U.S. to set reimbursement rates for CMS. When introduced in 2003, the original purpose of price-matching was to introduce  “market-based solutions” to federal entitlement spending. If the government must pay for some sort of service, the crafters of this policy argued that the price should avoid arbitrary negotiations and reflect the prices that prevail in the private market.

However, when payments are based on rigid formulas, they can be gamed. According to the Government Accountability Office, because “federal prices are generally based on prices paid by nonfederal purchasers such as private health insurers, manufacturers would have to raise prices to those purchasers in order to raise the federal prices.” And that’s exactly what they do. Although increasing prices to private insurers leads insurers to demand fewer of those drugs, drug manufacturers can make up for lost sales volume by selling more to public insurers at higher prices. In other words, drug manufacturers are profit-maximizing across their whole range of customers and not just private insurers. They’ll sacrifice some private-sector earnings to earn more in the aggregate.

Consider an extreme example: Suppose a manufacturer increased the price of an insulin prescription to $1 million, and only one person in the private market could afford it. Currently, insulin manufacturers make billions on the private U.S. market, so such an extreme price increase would reduce profit from the private market through lost sales. However, if Medicare purchases a million doses, even after the dramatic price increase, total revenue would increase by $1 trillion and far outstrip the company’s lost private-market earnings.

This extreme example is unlikely, but the general idea is borne out in real data: Despite overly stable rates of diabetes between 2007 and 2016, the number of insulin patients on Medicare increased from 1.6 million to 3.1 million. During this period, the list price of Lantus (insulin glargine) increased 257%, leading to a 764% increase in revenue from Medicare Part D. Consequently, between 2017 and 2019, CMS represented 59.7% of the Lantus market.

The current financial incentives disadvantage the U.S. private market and encourage patients to migrate from private to public insurance, further exacerbating the problem. As patients with private insurance increasingly cannot afford medications, they seek a public provider that will push their costs to taxpayers. Meanwhile, drug manufacturers can take advantage of this patient migration by further increasing prices after they switch to Medicare or Medicaid. Trump’s MFN plan would refocus these incentives by tying CMS prices to international markets. In that environment, the U.S. should expect private market prices to fall in addition to reimbursement rates by CMS. The bottom-up knowledge that informs prices in competitive markets is largely absent from governments, but international competition at least brings more buyers into the calculation for price-setting.

What is interesting is that Trump’s legal path to codify MFN as permanent policy is through Obamacare, which he unsuccessfully tried to repeal during his first administration. However, that failure might serve him well, because according to the added Section 1115A of the Social Security Act, Trump can test alternative pricing systems as “experiments” through the CMS Innovation Center—and make them permanent. If the experiment maintains quality while reducing costs, according to standards set by the CMS chief actuary and the secretary of the Department of Health and Human Services, the reimbursement scheme can enter rulemaking to be indefinitely expanded to the rest of CMS. Such a statute allows Trump to implement one of the most significant cost-saving measures in decades without Congress. Still, his administration must carefully follow the statute to avoid defeat through legal challenges.

If Trump can successfully separate Medicare and Medicaid reimbursement rates from prices in the U.S. private market, we should expect pharmaceutical prices in all markets to drop. Under the status quo, price increases reduce sales volume and patient access under commercial insurance and lead to more government spending on CMS. Instead of waiting to see whether pharmaceutical companies voluntarily reduce prices after his threats, Trump should immediately leverage Obamacare to implement MFN for Medicare and Medicaid reimbursements. Trump can legally do this without Congress, but he must move fast if he wishes to implement this policy by the end of his term. If MFN is not fully implemented by 2028, the next president may terminate the program.

The post Trump’s proposed price controls on Medicare and Medicaid could reduce government spending appeared first on Reason Foundation.

Marijuana liberalization has proliferated throughout the United States over the past decade. Though still technically illegal under federal law, marijuana is now permitted for medical use in 40 states and recreational use in 24 states and the District of Columbia. Attitudes towards marijuana use have greatly changed throughout the United States over the course of the last twenty years. According to a 2024 Pew Research poll, 88% of Americans now believe that marijuana should be made legal for at least medical use, with 57% of Americans also supporting legalization for recreational use. This sentiment stands in stark contrast to public opinion in 2000, when only 31% of Americans supported recreational legalization.

Additionally, major research organizations have concluded that marijuana can effectively treat a range of medical conditions, including chronic pain, according to a report from the National Academies of Sciences, Engineering, and Medicine (NASEM). Other studies show that marijuana is also effective in treating mental illnesses, such as post-traumatic stress disorder. Amid changing perceptions of recreational use and increased understanding of potential medical applications, the U.S. is now considering an adjustment of marijuana’s current prohibited status under federal law.

Despite these trends towards the general acceptance of marijuana legalization in the U.S., many remain skeptical of marijuana’s alleged benefits and wary of its potential consequences. In his book Tell Your Children: The Truth About Marijuana, Mental Illness, and Violence, journalist Alex Berenson voices concern about the relationship between marijuana use and the increased likelihood of experiencing psychosis and developing schizophrenia. Furthermore, the onset of schizophrenia, he argues, makes one more likely to experience a violent psychotic episode, increasing the risks surrounding marijuana use. He also alleges that medical marijuana use is misguided, given that little medical evidence suggests that the drug has any effectiveness in palliating the medical complications its advocates claim it can treat.

This review examines Berenson’s claims in light of the current literature in epidemiology, public health, and economics by reviewing his research summary and analyzing government data measuring marijuana use, mental illness, and violence. Despite Berenson’s claims, much of the literature he cites concludes that marijuana is effective in treating many conditions, including chronic pain—one of many scientific findings Berenson chooses to omit in his book.

However, there does appear to be an association between mental illness and marijuana use at the individual level, including a rare onset of schizophrenia. Still, the risk of developing mental illness is less associated with marijuana use than other intoxicants, like alcohol, and the risk decreases with lower levels of consumption. Additionally, it is unclear whether marijuana use leads to an increased likelihood of developing mental illness or if people with mental illnesses, like depression, are just more likely to use marijuana. The possibility of self-medication further complicates the understanding of this relationship.

Due to predictive decreases in violence following regulated marijuana access at the state level, we conclude that benefits from further liberalization outweigh public health concerns surrounding mental illness. Additionally, the risk of schizophrenia can be materially eliminated for almost all people with no current mental health issues through reasonable moderation. Furthermore, because marijuana-induced mental illness is so rare, marijuana’s effect on violence through compounding mental illness is not measurable and marijuana legalization appears to reduce the prevalence of violent crime and suicide.

Our analysis finds that at the state level:

• Recreational and medical marijuana legalization are not followed by increases in mental illness.
• Increases in marijuana use are associated with increases in mental illness for all age groups.
• Regulated marijuana access is followed by slight reductions in suicide for young adult men.
• Recreational marijuana access is followed by reductions in homicide.
• Recreational and medical marijuana legalization are associated with reductions in drug crime arrest rates and reductions in racial disparities in drug-sale arrests.
• Recreational marijuana legalization is followed by increases in marijuana use among adults, but stable rates of marijuana use among children.

Berenson’s characterization of the academic literature studying marijuana is limited, periodically inaccurate, and not sufficient to model policy. Despite the claims made in Tell Your Children, marijuana prohibition does not reduce rates of mental illness, while legalization appears to reduce violence by eliminating dangerous illicit markets.

Download the full study:

The post The truth about marijuana, mental illness, and violence: A review of Alex Berenson’s claims in ‘Tell Your Children’ appeared first on Reason Foundation.

And if you remember, in Florida, Bondi was trumpeted during her terms from 2011 to 2019 for cracking down on “pill mills,” putting in place restrictions on prescription pain killers, and suing the CVS chain for allegedly causing the opioid epidemic with loose prescription practices. 

Unfortunately, according to Florida Department of Health data, drug overdose deaths in the state nearly doubled from 13.7 per 100,000 residents in 2011, when Bondi took over as the state’s attorney general, to 25.1 deaths per 100,000 residents in 2019 when she left office. 

During the COVID-19 pandemic in 2020, overdose deaths increased dramatically nationwide and in Florida. 

While overdose deaths have since gradually decreased, they are still well above pre-pandemic levels at 30.8 per 100,000 residents in 2023.

Several events are taking place here that provide important lessons and tell us what to expect in the next four years.

Bondi is a national champion of what is called the “overprescription” hypothesis, which blames rising rates of opioid overdoses starting in the early 2000s on increasing prescribing of opioids starting in the 1990s. There is some truth in that. 

As opioid prescribing increased in the two decades before 2010, prescription opioids became the leading cause of drug overdoses. 

The response that Bondi helped to champion, which was followed in most states and funded with federal grants, was prescription drug monitoring programs, which are state laws limiting the number of pills a patient can receive. 

The Drug Enforcement Administration also ordered prescription opioid manufacturers to reduce opioid production. 

These approaches made perfect sense to policymakers at the time. Bondi made her implementation of the E-FORCE PDMP a centerpiece of her accomplishments as state attorney general, and it probably makes sense to you reading this.

The problem is that everyone involved in drug policy, including Bondi, had a steady drumbeat of evidence that the prescription drug monitoring program approach caused a rapid increase in opioid overdose deaths. This was true in states nationwide, including Florida, where the rate of opioid overdose deaths remains far more than double where it was in 2010. 

Look at the accompanying graph showing what happened in five states and Washington, D.C., when prescription monitoring was put into place between 2000 and 2020. As prescription rates declined, opioid overdose deaths rose.

At first thought, this seems counterintuitive. However, these results should have been easy to expect and easy to see in the annual data on opioid prescriptions and overdose deaths. 

Our history of drug prohibition consistently shows that when the government restricts access to something people want, it drives demand to the illicit market.  In this case, abuse of prescription opioids was a growing problem, but it was a fairly safe way to consume opioids. Once PDMP cut off that supply, just as alcohol prohibition in the 1920s pushed bootleggers to switch from beer to potent bathtub gin, opioid traffickers switched to fentanyl and its ilk. 

Data from the National Survey on Drug Use and Health show that pain reliever abuse rates have flattened out since 2002, while heroin and fentanyl abuse rates increased only after opioid prescription rates started to decline.

You can see this clearly in the accompanying graph on opioid mortality in Florida. When PDMPs were enacted in 2011 and prescription opioid prescribing declined, deaths from fentanyl and heroin began to skyrocket.

You would think policymakers in Florida and nationwide would look at these data and suspect that prescription drug monitoring programs and similar policies are not working. But you would be wrong.

Instead, they have clung to a simple narrative, often used by Bondi in her press releases, that PDMPs reduced deaths from prescription opioids, ignoring data showing vastly more deaths from other opioids. 

It is particularly tragic that we are seeing rising overdose deaths at a time when the United States is enjoying an appreciable drop in drug addiction rates. 

Opioid addiction, in particular, has been dropping for years. In 2002, 9.4% of Americans were addicted to a drug, including 0.7% of Americans addicted to opioids. In 2019, the last year measured with a comparable standard (DSM-IV), 7.4% of Americans were addicted to substances, with 0.6% of those being addicted to opioids.

Additionally, record levels of naloxone and addiction treatment medications are being distributed, which means more people received addiction treatment in 2021 than any other year in American history.

Fewer Americans are addicted to drugs, and more of those who are addicted are receiving medication-assisted treatment for addiction, yet more people are dying from drug use. 

The reality is that drug addiction and drug-related deaths don’t have much of a relationship. Drug-related deaths are almost solely caused by the safety of the drug supply, which is made more dangerous by drug enforcement like PDMPs.

The shift from prescription opioids to fentanyl and heroin meant those with substance use disorder began dying at such a high rate that overdoses are spiking despite a shrinking population of regular drug users. 

This raises the question of why we still have too many people with a substance use problem. 

Researchers point to a plethora of causes, including poverty and financial distress, severe fears and anxieties, and difficulty getting mental health treatment and addiction treatment. The summary, as best we can tell, is that many people have something in their heads or their lives that they are so desperate to escape that they will use even a very dangerous drug like fentanyl to get that escape.

Making a drug illegal has done little to reduce the number of people wanting it. But the false narrative of the drug war is easy to explain and easy to pursue. 

Unfortunately, it is extremely difficult to figure out why people are hurting so badly and, even more difficult, how to help them deal with it in a healthy fashion. 

It’s no surprise that policymakers tend to choose the easy route, regardless of whether it works. Bondi was no different. Nevertheless, there are other ways that can work. 

In France, policymakers addressed the state’s overdose epidemic by relaxing regulations on medication-assisted treatment, which combines addiction therapy with less dangerous prescription opioids.  The result was a 79% drop in overdose deaths in four years.

We don’t expect Attorney General Bondi to have learned from what her drug policies wrought in Florida or to change her approach when applying it nationwide. So, unfortunately, we can likely look forward to at least another four years of troubling numbers of opioid deaths that could be prevented.

A version of this commentary originally appeared in the Sarasota Observer.

The post In Florida, drug deaths rose under former Attorney General Pam Bondi appeared first on Reason Foundation.

This liberalization of sports betting has sparked criticism from gambling opponents who argue that the industry is predatory and causes significant financial harm. Charles Fain Lehman’s recent article in The Atlantic consolidates some of the more persuasive arguments against legal sports betting. However, his case for prohibition is at a loss. Lehman argues that sports gambling leads to measurable harm among society’s most vulnerable communities, and the tax revenue it generates is insufficient to offset these damages.

While it’s true that gambling addiction can lead to harm, the industry is too young, and available data are too limited to evaluate the industry’s impact accurately. Additionally, many people enjoy sports betting, and only about 1% of Americans are estimated to have a severe gambling problem. This figure is in comparison to the estimated 85% of Americans who have gambled at least once in their life (an estimated 60% in the past year).

Of the three academic working papers Lehman cites, one is of moderate quality, while the other two rely on convoluted methods that lead to questionable conclusions. In contrast to Lehman’s argument, the tax revenue from sports gambling is relatively substantial compared to its market size and other industries.

Lehman claims that the combined tax receipts of all 38 states amount to just $500 million per quarter—about $2 billion annually—which he describes as “anemic” compared to alcohol, tobacco, or marijuana. Yet, earlier in the article, he notes that sports gambling generates $10 billion annually in total revenue. According to Lehman’s figures, $2 billion in taxes represents 20% of the market, which is a significant rate. It’s unclear why, as a baseline assumption, sports betting should be expected to generate similar revenues to some of the most highly taxed products in the country. One of the primary justifications for taxing cigarettes and alcohol so highly is they generate costs to non-users via crime, car accidents, and healthcare. People who spend their money on sports betting do not impose similar costs on non-bettors.

Critics might argue that if the $10 billion of revenue is concentrated on society’s most vulnerable populations, the costs of legalization could be more significant than tax receipts justify. The most substantial evidence Lehman cites for this case is a working paper by Scott R. Baker, Justin Balthrop, Mark J. Johnson, Jason D. Kotter, and Kevin Pisciotta, which suggests that gambling reduces household savings, particularly among financially constrained households. However, the same could be said for some non-essential household consumer spending. By that logic, we’d need to ban virtually all forms of entertainment and recreation, including tickets for sporting events. 

Even if we accept Baker et al.’s concerns at face value, the evidence is difficult to verify. The data are not publicly available, and the study doesn’t include a complete picture of household finances. The authors reviewed a nonrandom selection of individual bank and credit card accounts, leaving out how the total assets of any single household were impacted. A more comprehensive analysis might look at state-level income, spending, and savings trends. However, such a study would still struggle to link directly to gambling households, highlighting the current lack of quality data.

Lehman also references two other studies, both of which have methodological flaws. Brett Hollenbeck, Poet Larsen, and Davide Proserpio find that gambling legalization leads to increases in bankruptcy rates, debt collections, debt consolidation loans, and auto loan delinquencies after gambling legalization. Yet these effects are attributed to a mere 0.3 percent decrease in average credit scores following legalization—a change too benign to be causal. 

Kyutaro Matsuzawa and Emily Arnesen, meanwhile, report a rise in intimate partner violence in states with legal gambling when a fan’s home team unexpectedly loses. However, their analysis only compares states with others that had “Sundays without ‘home’ games,” neglecting the potential impact of away games, which could produce similar effects among gamblers and bias the authors’ estimates. Their model focuses on a narrow set of games and fails to account for all gameplay possibilities, raising concerns about potential confounding factors. Because this study looks at population-level data, there also isn’t direct evidence that abusive partners bet on such games. Moreover, “significant” results only mean that the confidence intervals don’t include 0 and should not necessarily be interpreted as “relevant.” Papers for academic journals tend to focus on results that are most statistically significant rather than the most realistic. This is problematic because academics can try many statistical models until one produces confidence intervals that don’t include 0. Publishing significant results is fine, but these studies tend to leave out the results of models that didn’t work, which could undermine their findings.

Lehman’s broader implication by raising studies like Matsuzawa and Arnesen—that emotional triggers like losing a bet cause intimate partner violence—also provocatively misplaces responsibility for such violence on external events rather than on the abuser’s inability to manage emotional responses. Many studies have found a link between sporting events and domestic violence, even when gambling isn’t involved. However, few would argue that this correlation justifies banning sports altogether. As with any statistical model, results can be found that appear to correlate a harmful outcome with a chosen exposure, but correlation does not imply causation. Various factors that lead to adverse outcomes might also correlate with sports betting and could inappropriately imply that sports betting leads to domestic violence, lower credit scores, and reduced saving rates.

The United States lacks quality survey data to assess the full impact of gambling legalization. Lehman suggests that the previous prohibition on state legalization of sports betting under PASPA was relatively harmless. Still, it’s challenging to know what was occurring in the growing illegal gambling markets. Such unchecked markets don’t include consumer protections and could harm problem gamblers more. In a world where internet markets are challenging to control, it is wiser for states to regulate sports betting and benefit from the resulting tax revenue. 

Lehman also claims legalization hasn’t shrunk the size of the illegal market, pointing to a survey from Massachusetts showing monthly bettors were just as likely to bet through unauthorized channels after legalization. The problem is that the study Lehman cites was fielded just two months after the launch of retail sports betting and less than three weeks after the launch of online sports, with data collection ending just 18 days later. The author cautioned that “many jurisdictions internationally have found, it can take a substantial period of time for sports bettors to migrate fully from non-regulated to regulated providers.” Contrast this with the American Gaming Association’s research claiming more than 77 percent of online sports bets were placed through legal channels in 2023 compared to 44 percent in 2019, and 78 percent of bettors placed all or most of their bets through legal operators. To say legal sports betting hasn’t shrunk the illegal market is likely incorrect.

States that have legalized sports betting now have the tools to regulate the industry, provide better consumer protections for what was previously outside the law and practically impossible to track, and generate tax revenue that could not exist under prohibition.

The post Legalizing sports betting is the right call appeared first on Reason Foundation.

In his keynote address at the Federalist Society’s 2024 National Lawyers Convention, Justice Neil Gorsuch, alongside retired Justice Stephen Breyer, condemned the recent enforcement action of New York’s Department of Environmental Conservation against P’Nut the Squirrel. Door-kicking armed officers generated a new cause célèbre by swiftly confiscating and euthanizing an internet-famous pet squirrel rescued by a New York-based couple. In jest, Justice Gorsuch described how the New York government was clearly morally inferior to P’Nut’s owners despite the fact that the couple were pornographers who published content on the adult website OnlyFans.

All told, one theme from the Convention was clear: We can expect future decisions to lay bare the administrative state.

Columbia Law School’s own Professor Phillip Hamburger, speaking on a panel the day after Justice Gorsuch’s keynote, marshaled a new era by launching a Veuve Clicquot cork into the ceiling. He saw Loper, Jarkesy, Cargill, Corner Post, Axon, and Cochran, “all the wonderful cases,” as the “end of a beginning” worthy of celebration.

An upcoming case might have similar implications for the administrative state. In FDA v. Wages and White Lion Investments, L.L.C., currently pending before the Supreme Court, the Food and Drug Administration (FDA) is seeking to reverse a Fifth Circuit en banc decision that found the agency’s denial of marketing applications for flavored e-cigarette products to be arbitrary and capricious. The Fifth Circuit ruled that after years of leading e-cigarette manufacturers “on a wild goose chase” to successfully navigate the application process to market their products, the FDA pulled a “volte face” in issuing a blanket denial to over a million applications—changing the criteria for product approval after submission. The change in standards allowed the FDA to ignore key elements of the applications, which the agency previously said were necessary for approval.

The FDA’s denial orders have effectively amounted to a de facto ban on non-menthol flavored e-cigarette products—having done so through ad hoc adjudication (without rulemaking) and what the Fifth Circuit deemed a “(false) promise” that non-menthol flavors could “in theory” receive approval.

Significant investment from the hopeful manufacturers was obliterated in one fell swoop. Although the FDA originally estimated that the average cost of approval would range between $131,643 and $466,563 per product, the handful of companies that have received approval have so far reported their costs to range between $5 and $8 million for each product. It is impossible to measure the market size of the denied applications, but with over a million denials, it is fair to say that over a billion dollars in investments were rendered worthless by the FDA’s change in approval standards.

In its brief, FDA insists that the Fifth Circuit trounced a “hornbook principle” of administrative law inasmuch that an agency may choose to proceed through adjudication rather than rulemaking. The FDA says that this principle is supported by SEC v. Chenery Corp. (Chenery II), permitting the agency’s discretion “to develop a regulatory standard through ‘case-by-case evolution’ rather announcing [sic] a general standard ‘prospectively.’” Since it was decided in 1947, Chenery II has been regularly invoked by agencies to justify rules developed through either case-by-case adjudication or rulemaking when the authorizing statute does not foreclose either path.

Chenery II also allows agencies to enforce new regulations retroactively. Chenery II established a new era of ex post facto administrative regulation and has allowed agencies to enjoy unprecedented flexibility in applying their powers. However, Justice Jackson, who dissented in Chenery II, labeled the plurality opinion as “one of the worst ever.”

A plain reading of the Chenery II decision clearly expresses a preference for general rulemaking versus case-by-case adjudication. The oft-cited “hornbook principle” is given by the following:

The failure of the Commission to anticipate this problem and to promulgate a general rule [did not withdraw] all power from that agency to perform its statutory duty in this case. To hold that the Commission had no alternative [besides] formulating a general rule it might desire for use in future cases of this nature would be to stultify the administrative process.

Chenery II, 332 U.S. at 201-202.

While the plurality held that an agency can proceed to make law on a “case-by-case” basis, no strict standard for when rulemaking should be used in lieu of adjudication was introduced. However, with recent decisions like Loper, the Supreme Court might review current administrative practices, like Chenery II, and restrict broad discretionary powers based on the limitations originally outlined in the decision.

In Chenery II, the plurality observed that an agency, unlike a court, is endowed with prospective rulemaking power and, therefore, has “less reason to rely upon ad hoc adjudication to formulate new standards of conduct.” Additionally, the plurality counseled that agencies should effectuate their statutory commands through prospective rulemaking “as much as possible.”

The court went on to suggest that rulemaking by individual order is confined to three narrow circumstances of specialized problems: such that the agency (1) lacks “sufficient experience,”  (2) “could not reasonably foresee,” or (3) is dealing with circumstances “so specialized and varying in nature” that they are “impossible” to capture with a general rule. In the words of then-Judge Gorsuch in De Niz Robles v. Lynch, “the authority the Court extended to agencies to craft new rules retroactively through adjudication was not boundless.”

With these instructions, the FDA’s basis for retroactive ad hoc adjudication is up for debate. With e-cigarettes entering the U.S. market in 2007 and the deeming rule putting them under FDA authority in 2016, it might be tough to argue that the agency had insufficient experience with their regulation. The FDA has also long warned about the threat flavored nicotine products pose to public health, so one may argue that the agency should have foreseen its objections to flavored e-cigarettes when the agency gave its initial guidance. Preventing (mostly youth) exposure to e-cigarettes does not seem to be a specialized topic.

In the spirit of the plurality in Chenery II, an agency might be expected to explain why such circumstances apply to justify retroactive adjudication. The implications of FDA v. Wages and White Lion Investments, L.L.C. could be much larger than the future of the e-cigarette industry. The case provides an opportunity for the court to standardize agency discretion by clarifying and reaffirming the boundaries set in Chenery II, wherein a preference for prospective rulemaking is clear.

A version of this commentary originally appeared in the Columbia Business Law Review.

The post The future of ‘Chenery II’ appeared first on Reason Foundation.

The U.S. healthcare system is often criticized for its high costs, much of which are blamed on Big Pharma. In reality, pharmaceuticals account for only about 9% of total healthcare spending, yet Americans spend more than double the average per capita expenditure of other developed countries on prescription drugs.

The exorbitant prices that Americans pay for drugs relative to other countries are largely due to government policies that effectively subsidize other countries’ medications. Some policymakers see these high prices as a problem to fix, and they might be right. However, reducing prescription prices will inevitably reduce pharma profits, which will result in predictable and sometimes undesired tradeoffs.

Proponents of socialized medicine (e.g., government-funded universal healthcare) want America to embrace a system similar to that of Canada, Australia, and most European countries, which would increase government healthcare spending to broaden the size and scope of citizens’ medical coverage. However, the U.S. already outspends every other country on drugs on both an absolute and per capita basis, allowing its residents to consume the most and newest pharmaceuticals. Indeed, 65.2% of sales of new drugs released between 2013 and 2018 occurred in the United States, even though the U.S. only accounted for about 7.8% of world drug consumption in 2018. (Specifically, the U.S. consumed 225.4 billion defined daily doses out of the 2,876 billion consumed globally in that year.)

It is unclear whether this level of spending is necessary to foster innovation or whether it makes Americans healthier. Though pharmaceutical reform alone won’t fix America’s growing unfunded debt, simple adjustments could save taxpayers over $100 billion a year and force other countries to share the cost burden of innovation more equally.

Why Americans pay so much for drugs

The U.S. healthcare market subsidizes much of the world’s cutting-edge medical innovations, including a disproportionate amount of pharmaceutical developments. As a result, the socialized healthcare systems of other countries remain sustainable while their governments and taxpayers pay significantly less than they otherwise would for the same drugs consumed by Americans. This system also allows other countries to access drugs that likely wouldn’t exist if it weren’t for American-funded innovation. This status quo has helped make the U.S. a global leader in pharmaceutical development and innovation. However, given that 8 in 10 American adults believe that drugs are unreasonably expensive, stakeholders should consider how various reimbursement schemes affect the drug costs borne by patients and taxpayers.

Consider how the U.S. Medicaid and Medicare programs reimburse private insurers for drug purchases versus socialized healthcare systems in other countries. Under a true free market, patients or their insurers would privately negotiate prices with drug manufacturers to obtain drugs. Under socialized medical systems like the one in Australia, while private insurers purchase drugs through market-based price negotiations, the government programs often purchase drugs from manufacturers in bulk, using the fact that they are the primary buyer (a market condition known as monopsony) to negotiate lower prices. Public insurers often consider a range of market pricing data during negotiations to ensure the cost-effectiveness of their purchases, but there typically isn’t a rigid pricing formula that pharmaceutical companies can game. The U.S. Department of Veterans Affairs uses a similar model to purchase drugs for those it covers.

Conversely, the Centers for Medicare & Medicaid Services (CMS) in the U.S. are prohibited from negotiating prices directly with drug companies until the Inflation Reduction Act, which allows negotiations for a small but increasing number of drugs, takes effect in 2026. In most cases, Medicaid is legally required to pay the lowest price, Medicare Part B is required to pay the average sales price borne by the private market, and Medicare Part D subsidizes highly regulated private insurers to cover various prescription drugs.

According to the Government Accountability Office, since “federal prices are generally based on prices paid by nonfederal purchasers such as private health insurers, manufacturers would have to raise prices to those purchasers in order to raise the federal prices.” Indeed, since CMS is not allowed to negotiate down drug prices and instead pays prices pegged to what the American private market pays, pharmaceutical manufacturers have an incentive to raise the prices charged in the private market, even if this would result in fewer drugs being purchased in the private market and less profit from the private market for the manufacturers as a result.

Under a true free market, charging a price for private patients and insurers that is above the market price would not be a profit-maximizing strategy for pharmaceutical companies, since the quantity supplied and total revenue raised by drug sales would fall. However, under a quasi-public system that includes CMS, increasing prices above market rates can still be profit-maximizing because the reduced gains in the private market can be offset by CMS: Manufacturers receive the average and lowest private sales price for every drug that these government agencies purchase.

The Medicaid pricing model is especially perverse because it reduces the incentive for a drug company to offer a discount to any patient, especially patients with lower socioeconomic status, as this would automatically lower the price that the company would receive for every drug reimbursed by Medicaid. Since new pharmaceuticals are patent-protected, which establishes a monopoly, pharma would otherwise price-discriminate to the benefit of poorer consumers and the detriment of the wealthy. But under the status quo, pharma benefits from charging every American higher prices to preserve higher CMS reimbursements. Moreover, the larger the market-share proportion of a patent-protected drug that is reimbursed by CMS, the larger the incentive to inflate private prices above market rates.

Costs of a cure

For pharmaceutical manufacturers, the vast majority of their production costs come from navigating the expensive research and development and uncertain regulatory approval process for drugs, with actual manufacturing costs remaining relatively low. Drug patents confer an exclusive production license with a shelf life that allows developers and innovators to recoup research costs without fear that “free rider” manufacturers will simply copy their drugs and sell them at close to marginal production costs. This system maintains pharmaceutical companies’ incentive to invest vast sums of money into developing new cures amid current regulations.

It takes about 12 years, however, before a pharmaceutical company can begin recouping the R&D costs of a newly patented drug after initial discovery. Since a dollar of revenue in 12 years is worth less than a dollar of revenue earned today, future sales do not offset up-front R&D costs one-to-one. And given that the majority of pharmaceutical research projects won’t yield a commercially viable product, drug developers must also cover sunk costs from failed projects, using commercial returns from successful projects to justify funding future research. A 2018 Congressional Budget Office study found that a drug company must obtain a profit margin of 62.2% from products that succeed to allow for just a 4.8% return on all its assets overall. These costs have risen even further in recent years due to increased research costs and higher failure rates.

Expectations of future profits not only provide a reward incentive for innovative research and development (R&D), but also lower R&D financing costs for cash-strapped pharma firms. To cover the costs of R&D and regulatory approval, manufacturers must sell a large volume at prices well above marginal costs to either their public or private insurer customers. And since CMS cannot negotiate down prices on an exceptionally large volume of drugs they purchase, manufacturers expect to rely on it and its subsidiaries for disproportionately large sources of revenue to justify their R&D costs, thereby reducing the need for revenue from non-U.S. public insurers.

These gains from the U.S. market, which are disproportionately driven by government purchases, also provide companies with a greater incentive to research and develop drugs for the U.S. market. This has made the U.S. approval process the global leader in pharmaceutical innovation and home to more cutting-edge drugs and therapies that eventually reach the rest of the world. For instance, the Information Technology and Innovation Foundation (ITIF) reports that “[f]rom 2014 to 2018, U.S.-headquartered enterprises produced almost twice as many new chemical or biological entities as European ones, and nearly four times as many as Japan.”

The foundation also notes that “private research [into developing] new drugs in the United States [accounts for] a significantly higher percentage of GDP than in the rest of the world.” Even the next-highest investing countries, such as Japan, provide only a small fraction of U.S. investment in absolute terms. Other favorable factors, such as high federal government research investment, R&D tax credits, laws that better incentivize public-private pharma research projects, and a disproportionate share of the world’s top research universities, also benefit the U.S. However, pharmaceutical companies’ windfall gains from drug sales to the U.S. government remain significant.

In this way, the United States subsidizes socialized medicine for the world. For example, the U.S. public and private markets account for 70% of patented biopharmaceutical profits, despite only accounting for about 34% of GDP at purchasing power parity among Organisation for Economic Co-operation and Development countries. Therefore, it’s no surprise that the U.S. pharmaceutical industry allocates more of its profits toward R&D than other industries do. In 2014, pharmaceutical companies contributed about 43.8% of their total value added to R&D, a greater percentage than other high-value-added U.S. industries such as aerospace and electronics. Only the U.S. semiconductor and scientific research industries contribute a greater proportion of their sales toward R&D, which is not common in other countries.

Moreover, such economic activity is the consequence of unique profit opportunities in the U.S., but it comes at an equally unique high cost. Various policy interventions can be employed to reduce spending in the U.S., but each approach will reduce pharma profits in its way and, consequently, reduce global investment to find new cures.

Solution 1: Negotiation model

If CMS were allowed to negotiate drug purchase prices the way socialized systems in other countries do, even for just a small number of drugs, American taxpayers would save billions of dollars each year. CMS’s bargaining power as a monopsonistic bulk buyer is significantly greater than that of all other countries, so these cost savings are likely to be high. Simultaneously, Americans dependent on private insurance, such as that provided through employers, would also likely benefit from lower prices since the incentive to charge above-market prices to private insurers, to artificially boost the price of each drug purchased by CMS under the current system, would be eliminated. However, CMS’s price negotiations wouldn’t necessarily affect price negotiations with public insurers in other countries, since changes in U.S. pharma revenues don’t affect the profit-maximizing strategy for foreign buyers in their negotiations with pharma, all other things being equal.

Moreover, if CMS began negotiating down drug prices, pharmaceutical companies would have less funding to create new cures and bring them to market. One way to mitigate reductions in research funding would be to allow CMS to negotiate down prices for new drugs only after a certain number of years have elapsed. The Inflation Reduction Act’s CMS negotiation reform already utilizes a similar approach for some drugs. However, the world would still likely see less future revenue to incentivize pharmaceutical innovation. Foreign countries might respond by increasing their own research funding to service global demand that is no longer being subsidized by the United States. However, these new ventures would not fully account for the loss in worldwide pharmaceutical research investment caused by the decline in U.S. public purchases.

Conversely, as current levels of innovation would no longer be subsidized by the artificially inflated prices that pharmaceutical companies receive for drugs through CMS purchases under the status quo, pharmaceutical companies would shrink their research portfolios to prioritize the projects most likely to yield profits. Such projects would increasingly target the private insurance market, due to increased profits in this sector from lowering prices.

However, shifting a chunk of the burden of funding pharmaceutical research from the public healthcare market to the private insurer market could also mean less incentive to address issues that disproportionately affect Americans who are more likely to rely on CMS, including people who are poor and elderly. For example, we might expect less research investment in drugs that address illnesses that worsen with age—such as Alzheimer’s, arthritis, heart disease, type 2 diabetes, and many types of cancer—since these illnesses are more likely to affect CMS recipients than privately insured patients. However, shifting pharma’s focus to relatively younger, privately insured individuals might lead to healthier geriatric ages and reduce the need for investment in conditions that are the accumulation of chronic inflammation. Moreover, it’s not clear whether the superior R&D investment due to government subsidies makes the U.S. healthier.

Solution 2: “Most favored nations” model

An alternative to the negotiation model is the “most favored mations” (MFN) rule, which pegs CMS reimbursements to the prices paid by one or more foreign governments. The rule was first proposed under the Trump administration in 2018 but was later scrapped by the Biden administration. Like direct negotiations, the MFN model would lead to both taxpayers and private buyers in the U.S. paying less for prescription drugs, while pharmaceutical companies would be incentivized to charge higher prices to foreign public insurers. However, since these buyers cannot match the bulk purchasing power of the U.S., foreign reference prices would be lower than current CMS reimbursements that reference the U.S. private market, which would likely reduce pharma profits from both CMS and abroad.

Also, like direct negotiations, MFN would prevent pharma from artificially inflating private market prices in the U.S. and would shift the proportion of total innovation costs from the U.S. to other countries. Furthermore, since U.S. insurance companies will pay a lower price for drugs and thus theoretically buy a greater quantity than they currently do, private market demand and increased profit from this sector would replace some of pharma’s current research investment incentives from domestic and foreign government purchases.

One major problem with MFN is that it could reduce profit for pharma from foreign countries relative to price negotiations. If prices do inevitably increase to secure higher CMS reimbursements, foreign governments might reduce their purchasing volumes. Much like the status quo, when U.S. public insurers would purchase drugs under MFN, pharma would forgo higher profits from foreign public insurers by charging them above-market prices to secure higher rates of return from higher-volume CMS purchases. However, unlike private insurers, foreign public insurers operate under political pressure to secure medicines for their constituents. If the U.S. were to implement MFN, evolving political pressures might motivate foreign governments to purchase similar quantities despite price hikes on drugs.

Indeed, raising public debt, cutting other public expenditures, and raising taxes are easier tasks for foreign governments relative to private insurers charging higher premiums, since insurers’ customers may voluntarily stop purchasing their products. Under this scenario, pharma might increase its profits from some countries under MFN. However, if pharmaceutical companies were capable of charging foreign governments higher prices to increase profit, they would theoretically have done so already. Keep in mind that if foreign governments do substantially reduce the number of drugs they purchase, you may see more of their citizens turn to the private market to purchase drugs.

Considering the tradeoffs

When price negotiations and MFN were first proposed, they attracted substantial backlash from the pharmaceutical industry and even from some libertarian groups who argued that they amounted to “price controls” on drugs and would “import socialism.” However, these claims could not be further from the truth. Price controls are government intrusions into negotiations between private parties, not restrictions on the government’s spending. Under a free market, government entities ought to exercise good stewardship of taxpayer resources by behaving more like a private party by reducing the prices they pay. By increasing pricing pressure on countries with socialized medicine, price negotiations, and MFN wouldn’t import socialism—they would export capitalism by making the U.S. and other countries more reliant on their private markets.

However, the tradeoff of lower drug prices and a significantly lower drug bill for U.S. taxpayers, from either price negotiations or MFN, could lead to a long-term decline in new drug discovery due to less incentive for R&D. According to ITIF, mental illnesses alone impose a $1.5 trillion penalty on the U.S. GDP every year, highlighting the societal benefits that discovering new drugs might bring. For example, the Alzheimer’s Association claims that discovering a new drug for treating dementia by 2025 would lower treatment costs by a third while delaying its onset by five years. If true, these benefits may be delayed if new government purchasing models significantly reduce pharma revenue and profit margins from Alzheimer’s patients.

Basic economics suggests that Americans would be better off shifting their resources to industries they find valuable, versus policymakers trying to centrally plan incentives to bolster medical innovation. However, some studies find that the vast majority of social benefits provided by pharmaceutical research are not internalized or captured by profits from drug sales, even under the status quo.

Many other policies are worthy of attention when it comes to supporting medical research and thus incentivizing new drug discovery—for instance, reforming the patent process, reducing the costs of drug approvals, and eschewing recent government moves to “march in” and fix the prices for taxpayer-funded innovations in public-private partnerships. Regardless, the way that taxpayer-funded U.S. agencies pay for drugs has important implications for global and U.S. innovation, the sustainability of public budgets and debt, and the affordability of drugs.

Moving toward more market-based negotiations or MFN models would increase the per-dollar value of research investment by better aligning it with market demand while making drugs more affordable for Americans. However, these reforms would also reduce total funding available for research and could disincentivize research into new treatments affecting some of society’s most vulnerable individuals, especially the poor and elderly. The reforms may or may not be worth the consequences, but we shouldn’t ignore the tradeoffs altogether by insisting that the U.S. should embrace a European-style single-payer healthcare system. Their “free” healthcare is a myth—Americans are paying for it.

The post How America subsidizes medicine across the world appeared first on Reason Foundation.

We applaud President Joe Biden for requesting the Drug Enforcement Administration (DEA) to initiate a rescheduling hearing for marijuana on October 6, 2022. We are further pleased with the review of scientific literature subsequently undertaken by the U.S. Department of Health and Human Services (HHS) that resulted in a series of binding conclusions that marijuana has accepted medical use and holds lesser potential for abuse than other substances currently listed in Schedules II under the Controlled Substances Act (CSA). The Attorney General’s Office of Legal Counsel has advised that any requirements imposed by international treaties to which the United States is a party to make a substance contraband cannot supersede the scheduling procedures set forth elsewhere in the Controlled Substances Act. In other words, the DEA holds impeded authority to determine the proper scheduling of marijuana under the criteria outlined in 21 U.S.C. 811(a) through (c). HHS has recommended marijuana be moved to Schedule III, and we are commenting on the DEA’s regulatory hearing to consider this recommendation.

The DEA has specifically solicited public input on the possible “unique economic impacts” of rescheduling, given that “marijuana is subject to a number of State laws that have allowed a multibillion dollar industry to develop.” Reason Foundation has published extensive research on the possible economic impacts of moving marijuana to Schedule III and is uniquely positioned to inform this request by the DEA.

Full comment: A Schedule III designation is still overly restrictive for marijuana

The post A Schedule III designation is still overly restrictive for marijuana appeared first on Reason Foundation.

In the new publication, “Association Between Marijuana Laws and Suicide Among 12- to 25-Year-Olds in the United States From 2000 to 2019”, Christopher J. Hammond, J. Madison Hyer, Anne E. Boustead, Mary A. Fristad, Danielle L. Steelesmith, Guy N. Brock, Deborah S. Hasin, and Cynthia A. Fontanella compared suicide mortality data to state-level marijuana legalization efforts, such as permitting regulated medical and recreational markets. The authors found that recreational marijuana laws were associated with a 9% increase in suicide rates among all youth ages 14 to 16. They also found that medical and recreational laws were associated with 10% and 16% increases in suicide rates among female youth ages 12 to 25, respectively.

My preprint study with Robert Capodilupo, Michael Schemenaur, and Jeffrey A. Singer found the opposite results among similar age groups—marijuana laws were associated with a decline in suicide rates. So why the difference?

The difference is due to technical concerns of statistical analysis. Concisely, the authors chose an inappropriate model given the data distribution. The methods in the Hammond study exaggerate the effect of marijuana laws on suicide rates in states with relatively few suicides. States that had not yet or never did legalize marijuana were more likely to have near-zero suicide rates, because suicide rates have increased across all states over time. Because of the model the authors selected, the JAACAP study shows that states with regulated marijuana markets have higher suicide rates, regardless of whether suicides have risen at faster rates in those states after their marijuana laws went into effect.

The new JAACAP study employed a negative binomial regression, which assumes that the plurality of states had zero suicides to begin with and then examines changes in the number of suicides in each state. In reality, suicides occur in every state, and the average state-level suicide rate is approximately 14 deaths per 100,000 population. Therefore, state-level suicide rates don’t follow a negative binomial distribution.

For example, consider the distributions of state-level suicide rates among males ages 15 to 19 in Figure 1 below, which we analyzed in our study. The raw data (on the left) almost follow a normal distribution in which observations are closely grouped around a median value. A negative binomial distribution, however, assumes the modal observation is a zero value. Many statistical models exist to help researchers match their approach to the data and, in theory, the distribution curve associated with any model should closely fit the shape of the data. In Figure 1, we superimpose the data shape implied by the two models over the data as a red line. In our preferred model (on the right), we have taken a natural log of the data and then treated it as a normal distribution. The data fits the normal distribution shape implied by the red line much better than the model used by the Hammond team. This means that a basic linear regression on log-transformed data is more appropriate for this type of analysis, lending greater credibility to our analysis and conclusions.

After transforming the data and controlling for various sociodemographic factors, such as personal income and unemployment, we found that suicide rates on average generally drop among female and male youth after states allow both medical and recreational marijuana access, although these results weren’t statistically significant for all of our robustness checks. Therefore, suicide rates tend to drop with greater marijuana access, but we can’t conclude that the policies themselves were the cause of the drop. However, suicide rates do predictively drop about 5.4% for males ages 30 to 39 following medical marijuana access, which drove reductions in the total male suicide rate (table of our full results). To be clear, our results are all associations and should not necessarily be interpreted as causal, but the data show that suicide rates don’t increase after state laws allow for greater marijuana access.

Actual marijuana use by teens hasn’t changed with legalization, another strike against the Hammond study’s conclusion. If marijuana legalization led to changes in suicide rates among youth, you’d expect it to be because youth are using marijuana more often. However, our analysis also shows that rates of marijuana use among youth remained stable after states adopted recreational marijuana markets (Figure 2).

Inappropriate model selection is why conflicting results appear throughout the public health literature. In the case of suicide rates, our study rigorously shows that they tend to drop among youth following both recreational and medical marijuana access, which supports the original findings by Anderson et al. (2014) in the American Journal of Public Health.

The post Marijuana legalization is not associated with increases in youth suicide rates appeared first on Reason Foundation.

A fundamental argument from special interest groups supporting the banning of menthol cigarettes is that they pose a danger to youth above and beyond that of regular cigarettes because they more easily entice them to start smoking and become dependent. However, new research finds this argument lacking.

Our recent Reason Foundation study determined whether menthol cigarette sales led to higher rates of youth smoking than non-flavored cigarette sales. It evaluated the relation to smoking rates among adults and youth. State-level wholesale cigarette data from 2008 to 2020 was used to compare the number of actual packs sold, whether menthol or regular cigarettes, to the government’s estimates of past 30-day smoking rates.

States with more menthol cigarette consumption relative to all cigarettes generally had lower rates of both adult and youth smoking. Montana, for example, had the highest youth smoking rate in the country but the lowest share of menthol sales as a percentage of the total cigarette market.

On the other side of the coin, Hawaii had the highest percentage of menthol cigarettes sold but the second-lowest youth smoking rate in the country.

Data is also disproving the argument that menthol is more addictive. Menthol smokers use fewer cigarettes per day, and data from Vanderbilt University Medical Center shows no difference in the quit rates between menthol smokers and non-menthol smokers.

Today, youth smoking in America is minimal, with fewer than two percent of kids puffing on a cigarette in the past month, according to the Centers for Disease Control and Prevention. But banning millions of adults from their products of choice would help fuel the illicit tobacco market, handing a massive profit opportunity to criminal entities, especially Mexican cartels. If the menthol ban moves forward, overstretched border and law enforcement officers will likely soon find themselves spending more of their resources to police an influx of tobacco products. There are, however, cheaper and less costly alternatives to the prohibition being pushed on the administration.      

Brian King, head of the Food and Drug Administration’s (FDA) Center for Tobacco Products, acknowledges the widespread misperceptions around the risks of vaping compared to smoking but has taken no action to correct them. The FDA’s lack of interest in the health benefits of vaping over smoking is incredibly discouraging.

For example, the prestigious Cochrane Review found e-cigarettes to be significantly more effective in helping smokers quit than traditional nicotine replacement therapies such as nicotine patches. Absent concerted efforts to inform and incentivize menthol smokers to switch to less harmful nicotine alternatives, a prohibition will undoubtedly enlarge the already substantial illicit tobacco market as it has in other countries that have experimented with menthol bans.    

Rejecting or accepting a menthol ban should be based on the evidence, health benefits and relevant tradeoffs involved. President Biden shouldn’t be cowed by bureaucrats at the FDA or single-issue pressure groups into a policy blunder that would not produce significant health benefits while costing state and federal revenue and increasing crime and policing in minority communities.   

With youth smoking almost eliminated in the United States, cigarette advertising already banned, tobacco taxes at record highs, and a proliferation of safer alternatives to smoking available and being developed, the case for a new era of cigarette prohibition is weaker than at any time in recent history. But, the risk of unintended consequences of a menthol ban, particularly in minority communities where we can expect the illicit market to be concentrated, is still very real.

The post Biden administration should reject the proposed menthol ban appeared first on Reason Foundation.

The Family Smoking Prevention and Tobacco Control Act (TCA) of 2009 outlawed the manufacture, distribution, and sale of cigarettes with “characterizing flavors” other than menthol. Supporters of the TCA claimed cigarettes flavored like candy, fruit, and clove disproportionately appeal to minors, facilitating smoking initiation and dependence. As a result of the TCA, regulating tobacco products was, for the first time, put under the purview of the Food and Drug Administration (FDA).

Partly the result of an extraordinary alliance between Philip Morris and the Campaign for Tobacco-Free Kids, the TCA erected enormous regulatory barriers to introducing new tobacco products. Raising costs for competitors and banning flavors while exempting menthol cigarettes mainly appeased Philip Morris, the only tobacco company in favor of the bill. Tobacco control activists viewed the exemption of menthol as a missed opportunity and have long sought to convince the FDA to ban menthol cigarettes outright. The Biden administration is now intent on delivering this policy. When the TCA was being considered, the president of the Campaign for Tobacco-Free Kids (CTFK), Matthew Myers, explained why he opposed banning menthol cigarettes.“If you immediately withdrew a product, so many people use and are addicted to, you can’t say for certain what the reaction will be,” said Myers, who went on to warn that such a ban could lead to illegal trafficking.

Section 907 of the TCA authorizes the FDA to establish a product standard requiring tobacco manufacturers to eliminate menthol from their products if it is “appropriate for the protection of public health.”

To meet these criteria, the FDA must consider:

• The risks and benefits to the population as a whole, including users and non-users of tobacco products;
• The increased or decreased likelihood that existing users of tobacco products will stop using such products; and
• The increased or decreased likelihood that those who do not use tobacco products will start using such products.

To address these considerations, the Tobacco Products Scientific Advisory Committee (TPSAC), a creation of the TCA, was charged with reviewing the scientific evidence regarding menthol and recommending future regulation to the FDA. In 2011, the TPSAC published its review of menthol cigarettes, concluding that they have a negative effect on public health.

A separate review by the FDA published in 2013 found: “Menthol in cigarettes is likely associated with increased initiation and progression to regular use of cigarette smoking.” However, FDA’s evaluation found “little evidence to suggest that menthol cigarettes are more or less toxic or contribute to more disease risk to the user than nonmenthol cigarettes.”

Considering menthol cigarettes are not more dangerous than nonmenthols when it comes to their toxicological makeup, FDA must demonstrate why these products are deserving of prohibition compared to nonmenthol cigarettes, which are responsible for most smoking-related deaths and disease in the United States.

On April 22, 2022, the FDA announced it would pursue a ban on the sale of menthol cigarettes. The announcement came as new data from the 2021 National Youth Tobacco Survey (NYTS) revealed the current smoking rate among middle and high school students at a record low of 1.5%. Of those students who smoke, the majority, 61%, use nonmenthol cigarettes.

Nevertheless, claims made against menthol should be considered and reviewed to see if critics’ claims are borne out in the real world. Suppose the association between menthol cigarettes, increased youth initiation, and dependence is as strong as tobacco control activists suggest. In that case, there should be signs of it in the national data.

Employing National Survey on Drug Use and Health (NSDUH) data from the Substance Abuse and Mental Health Services Administration (SAMHSA) and industry distribution figures, Reason Foundation examined whether there was a strong positive relationship between the distribution of menthol cigarettes and youth cigarette smoking. The data covered all 50 states and Washington, D.C., for 2008–2020.

The resulting analysis found:

• States with more menthol cigarette consumption relative to all cigarettes have lower rates of child smoking;
• States with higher per capita distribution levels of cigarettes of all types have higher rates of both adult and child smoking;
• In general, the metric analyses show consistent nonpredictive relationships between relative menthol cigarette consumption rates and use of any age group; and,
• The only predictive relationship is between adult and child smoking rates, and since we do not expect children to cause their parents to smoke, we conclude that states with higher rates of adult cigarette smoking cause higher rates of youth use.

The data demonstrate that menthol cigarette distribution does not increase youth smoking initiation any more than regular cigarette distribution.

This study concludes that menthol cigarette availability does not pose a greater threat to public health than regular cigarette availability.

From these findings, we can infer that the best way to lower the youth smoking rate is to reduce the adult smoking rate in concurrence with the public health literature. But any consideration of menthol prohibition should be made in the context of extremely low youth use of the product, the lack of association between menthol use rates in states and youth smoking, the costs of enforcing prohibition, especially for minority communities, and other less costly ways of reducing smoking, such as increasing the availability of safer nicotine alternatives like e-cigarettes and traditional smoking cessation services.

Full Study: Menthol Myths Revisited

The post Study: Menthol cigarettes do not increase youth smoking more than other cigarettes appeared first on Reason Foundation.

The Drug Legalization Handbook is a living document. As new information and data arrive, the words on these pages will change. The intent of this handbook is simply to provide a framework for how to legalize all drugs. Much conversation and work has been done to detail why we should legalize drugs, but not enough effort has been done to show people how we can successfully legalize drugs in the current legal regime.

As the founder of the National Coalition for Drug Legalization, I must admit that my journey to believing in the legalization of all drugs began with loss and tragedy. As late as 2017, I supported drug prohibition. However, when my cousin Duane passed away, his death made me think about issues that affect Black men and the Black community as a whole. Duane was born drug dependent. He later went to prison over drugs and died in his struggle with alcoholism. At his funeral, I met his son Desmond for the first time. I could not believe how much Desmond resembled Duane. He had Duane’s fingers, body shape, and demeanor. There was no denying that he was Duane’s son. Immediately, I made a commitment to ensure that Desmond did not live the life his father led. I made Desmond an offer: He could live with me provided that he graduate from high school, go to college, and work. Desmond kept his end of the deal when he graduated from high school. This was a proud moment for me, considering that his father dropped out of high school in the 12th grade. To see Desmond in college and working part time made me very happy, but I couldn’t help but think why Duane’s story of drug abuse and imprisonment is so common among Black families? Why couldn’t Duane see his son graduate from high school? Why couldn’t Duane move beyond his substance abuse problem?

The answer is drug prohibition.

Our current drug laws negatively and disproportionally affect people of color, especially Black people. The felony record Duane received from his drug sentence prohibited him from finding a decent job, applying for Pell Grants, and accessing most kinds of public assistance.

I then started to think about issues related to poverty and how drug prohibition contributes to crime and drug overdoses in poverty-stricken communities. People will resort to selling drugs when job opportunities for low-skilled, low-wage workers are virtually non-existent. People will abuse drugs under the same circumstances.

Our drug supply is not safe. Prohibition has created very fertile ground for organized crime. There are no standards for purity or potency, hence the increase of fentanyl overdoses due to contamination unbeknownst to drug users. Violence is common in an illicit economy where people cannot resolve their disputes through lawsuits or arbitration.

America needs to recognize that we will not see a reduction in violent crimes until we legalize drugs. All drugs. We need to recognize that we will not see a reduction in opioid overdoses until we legalize opioids like heroin. I ask that all who read this handbook keep an open mind. What is presented is unconventional, but it is clear that the current approach to drug use has failed. Use a critical eye to evaluate the guidance shared in this handbook. I hope to open your heart and inspire you to join our movement to abolish drug prohibition.

I want to thank all of the esteemed contributors to this handbook.

The views and opinions expressed within each section are those of the authors and do not necessarily reflect on the collective. From the outset, I believed it was important to include a range of viewpoints from among the community of drug-policy reform advocates. I’m thrilled that we were able to get so many knowledgeable contributors to impart their wisdom.

In solidarity,

Veronica Wright,
Founder of the National Coalition for Drug Legalization

Introduction

The prospective legalization of drugs is a sensitive and complicated topic that inevitably evokes visceral reactions from most observers. Legalization proponents believe the drug war has represented a vast overreach of government power and that this power has often been applied in arbitrary and discriminatory ways.

Often, the so-called “War on Drugs” has served as a pretext for authorities to harass communities or individuals they dislike. More broadly, a prohibition on legal commerce simply creates market opportunities for illegal sellers to organize illicit markets. American prohibition of alcohol, for example, led to the emergence of the American Mafia, which sought to fill the still-existent popular demand for liquor. Today, there are clear parallels with international drug cartels.

On the other hand, defenders of the status quo believe federal, state, and local governments safeguard the public welfare by enforcing drug prohibition. They believe drugs are a threat to national health and rightly view addiction as leading to a pattern of destructive behavior.

Parents often worry about how the availability of drugs will affect their children. No parent wants to see their child succumb to addiction. All of these concerns are valid. However, the contributors to this volume recognize that the use and abuse of drugs have not disappeared even after decades of strict legal prohibition. To the contrary, deaths associated with drug use have reached all-time highs in recent years. Drugs adulterated with harmful substances like fentanyl have proliferated rapidly in an illicit market where there are no manufacturing standards, clear labeling requirements, or product liability insurance. Likewise, violence throughout Latin America and along the border states has grown steadily for decades as international drug cartels have amassed power and wealth.

In the face of these dangers, it may be time to admit that a legal and regulated market for drugs is likely to produce less dangerous outcomes for both society at large and the individuals who choose to consume drugs. Orderly transactions for clearly labeled products with controlled access or medical supervision can cut through the violence associated with illicit markets and also minimize accidental overdose. The contributors to this volume hope to launch a renewed national conversation about whether the drug war actually protects the American public from harm. If not, we as a society should begin to consider an alternative approach based on reason and evidence.

The approaches considered here are intended to inform that debate.

Geoffrey Lawrence,
Research Director, Reason Foundation

Table of Contents

Part 1 The History of the War on Drugs

• 1.1 Milestones in American Drug Policy

Part 2 Adult Recreational Use

Part 3 Taking Drugs Off the Schedule: Eliminating the Controlled Substances Act

Part 4 Sensible Retail Markets

• 4.1 Majority of Overdose Deaths Are Due to Adulterants
• 4.2 A Regulated Market
• 4.3 Consumption Limits and Restrictions

Part 5 Therapy for Drug Dependence

Part 6 Role of Law Enforcement and Policing

Part 7 Protections from Civil and Criminal Liability

Part 8 Packaging, Labeling and Dosage of Drugs and Drug Products

Part 9 Financial Institutions

Part 10 Education and Research

Part 11 Establishment of A Regulatory Board

Part 12 Taxation of Drugs and Drug Products

Part 13 Testing of Drugs and Drug Products

Part 14 Restorative Justice: Social Responsibility and Community Reinvestment

Part 15 International Trade

Part 16 Medical Administration

Part 17 Conclusion

Full Document: Drug Legalization Handbook

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Gov. Hochul’s flawed theory is that banning menthol products would substantially reduce smoking in the black community. But Massachusetts was the first state to implement a similar ban in June 2020, and things have not gone to plan. 

A new study led by the principal scientist in tobacco research at the American Cancer Society shows Massachusetts’ menthol ban produced a 56.8% relative decline in smoking among black men compared to other states. But smoking among black women increased by 58.6% after the ban. With the research finding that black men and black women in Massachusetts were smoking at equal rates before the ban, the study implies that menthol prohibition was associated with an overall increase in smoking among black adults in Massachusetts. 

The results are remarkable, as the American Cancer Society vocally supports menthol prohibition. Yet its lead researcher found Massachusetts’ ban, on net, likely did more harm than good among the people it was supposed to help the most. 

After the Massachusetts ban, Reason Foundation found that cigarette sales exploded in neighboring states. Approximately 33 million additional packs of cigarettes were sold in neighboring counties in the year after the ban. Massachusetts’ Multi-Agency Illegal Tobacco Task Force says its inspectors are “routinely” seizing menthol cigarettes brought in from other states. Now, the agency is asking for new criminal provisions— laws and harsher penalties— to help slow illicit trade. The flavored tobacco ban is spawning a downward spiral where criminalizing the sale of previously legal products creates more problems necessitating further criminalization. And New York should expect the same.  

“Banning a substance used primarily by Black and Brown adults will increase racial profiling, police interactions, and underreported stops in New York City. Moreover, this is a discriminatory ban because it will not affect the sale of non-mentholated cigarettes, which white smokers prefer,” Rev. Al Sharpton’s National Action Network wrote to Politico. 

A flavored tobacco ban would turbocharge New York’s already thriving black market. According to the Tax Foundation, more than half the cigarettes sold in New York—the highest percentage in the country—come from out of state due to New York’s high taxes. The menthol ban would further increase illegal tobacco sales, which could cost New York as much as $455 million in lost tax revenue.

Gov. Hochul and supporters of prohibition claim menthol is particularly dangerous. 

“What we’re concerned about is the highly addictive properties of menthol because it has more soothing ingredients that makes it easier to smoke more,” Hochul said. “And it’s more of an attraction to young people to start out on the path of a lifetime of smoking addiction.”

In reality, the majority of young people who smoke do not use menthol products. Additionally, menthol smokers smoke fewer cigarettes daily and quit smoking at the same rates as non-menthol smokers. 

The weak public health arguments for the menthol ban are based on misrepresentations. A similar flavored tobacco prohibition in Massachusetts has been an epic failure.  And New York’s proposed ban on menthol cigarettes would be especially insidious because it is explicitly racially targeted at the very community it purports to help.

Gov. Hochul should abandon this wrongheaded war on menthol.

The post New York’s legislature should stand firm against Gov. Hochul’s tobacco prohibition appeared first on Reason Foundation.

In a letter by Florida Attorney General Ashley Moody published in The Observer last month, she called upon President Joe Biden to officially designate fentanyl as a weapon of mass destruction. Similarly, Florida Sen. Rick Scott put out a press release calling for fentanyl to be designated a weapon of mass destruction:

Senator Scott is also working with Senator Marco Rubio to pass the Felony Murder for Deadly Fentanyl Distribution Act. The bill makes the distribution of fentanyl, resulting in death, punishable by federal felony murder charges. Additionally, Senator Scott and his colleagues sent a letter to President Biden to urge him to pursue a comprehensive strategy to combat this epidemic by designating illicit fentanyl analogues and all precursor chemicals as weapons of mass destruction (WMD).

Congress’ House Energy & Commerce Committee recently held a hearing on the fentanyl crisis, which largely shared the same sentiment. Although much of the rhetoric from Florida politicians and many in Congress calls for tougher penalties and blames a porous Southern border, illegal immigration has little to do with fentanyl overdoses.

According to U.S. Customs and Border Protection, Southwest border encounters fell during the Obama administration, increased during the Trump administration, and have skyrocketed amid the Biden administration — yet illicit opioid overdoses (like fentanyl) rose every single year of each presidency. Indeed, fentanyl increasingly infiltrated the country while President Trump reduced the unauthorized immigrant population. The fact of the matter is that the vast majority of fentanyl is trafficked through ports of entry and carrier packages — not on the backs of illegal immigrants and trafficker coyotes. And unfortunately, there’s no amount of enforcement that can stop it. In fact, it’s the enforcement itself that has led to fentanyl being the preferred drug of traffickers, and labeling fentanyl as a weapon of mass destruction would only lead to more concentrated illicit drugs.

How it started

Heroin overdoses began to increase in 2011, the year after law enforcement began mandating reductions in opioid prescribing across the country. Indeed, opioid prescribing rates have decreased every single year since 2010, and it is no coincidence that overdoses from black market opioids have increased in tandem, as Centers for Disease Control and Prevention data in the accompanying figure shows. Florida Attorney General Moody’s aggressive policies on prescription opioids double down on the very cause of the overdose crisis.

Drug Enforcement Administration data show that as heroin seizures rose over the past decade, production of heroin in Mexico began to decline. Simultaneously, drug enforcement increasingly encountered fentanyl. Although illicit heroin has a high overdose potential, it is still much less potent compared to fentanyl. But it was the success of heroin seizures that motivated drug traffickers to begin engineering more potent substances so that they could more easily conceal the product while transporting. During alcohol prohibition in the 1920s, bootleggers stopped supplying beer and wine in favor of liquor since it was easier to conceal from police and provided more ‘bang for the buck,’ so to speak. These same incentives have motivated the cartels to supply fentanyl instead of heroin.

Now, after the Drug Enforcement Administration’s record year of fentanyl seizures in 2021, a new drug that can be 20 to 100 times stronger than fentanyl — isotonitazene — has started to appear more in the toxicologies of drug overdose victims. There is a pattern of futility here in addressing the problem with more prohibition. If Congress labels fentanyl as a WMD, the U.S. will increasingly see drugs like isotonitazene in the country and even more overdoses.

Some may think that there has been an increase in opioid addiction in the U.S., but the Substandard Abuse and Mental Health Services Administration reports that opioid use and addiction have both been dropping since 2015, and in fact, the misuse of opioids in the U.S. is now at its lowest rate in over 20 years. The only reason why so many more people are dying is because the illicit drug market is so dangerous — not because there are more drug users.

If we were to offer both legitimate pain patients and those addicted to opioids safer legal alternatives to cartel-supplied drugs, we would see a massive decrease in death. Punishment rarely convinces those with drug abuse problems to quit but helps address the problems that cause drug abuse. But that requires weaning them off the drugs, which is hard to do with prohibition. Prohibition also creates massive incentives for violence and ever more unsafe versions of drugs, creating an environment where helping drug users is very difficult. It’s a circular problem and we have to break the cycle.

But until our policymakers recognize the factual reality that prohibition keeps failing, and doubling down on it with a WMD declaration is only doubling down on failure, drug overdoses will continue to rise.

A version of this commentary was first published in the Sarasota (FL) Observer.

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On June 1, 2020, Massachusetts became the first state in the US to implement a comprehensive prohibition on all flavored tobacco products, including menthol cigarettes. My study for Reason Foundation revealed that cross-state trafficking led to a net increase in cigarette sales for the Massachusetts region after considering the rise in cigarette sales in surrounding states after the ban. 

Now, the medical literature also acknowledges that the increase in cigarette sales has manifested in increases in smoking for various populations, especially those the prohibition intended to target. Indeed, the letter’s authors specifically advise, “As the FDA plans to eliminate menthol as a characterizing flavor in cigarettes, interventions should address possible increases in cigarette smoking among Black females.”

According to Asare et al., the menthol cigarette ban in Massachusetts led to an 8.1% relative decrease in smoking among adults 25 years and older, with the prevalence of current cigarette use dropping from 13.0% in 2019 to 12.0% by 2021. Part of this decrease was due to a reported 56.8% relative decrease in smoking among black men. However, with a 58.6% relative increase in smoking among black women and an equal prevalence of smoking among both genders in 2019, the menthol cigarette ban led to a net increase in smoking among black adults in Massachusetts. 

The authors’ approach involved a difference-in-differences analysis, looking at whether the changes in smoking for various populations in Massachusetts differed from other states throughout the country after the menthol cigarette ban. Referencing individual-level data from the Behavioral Risk Factor Surveillance System (BRFSS) survey, Asare et al. created state-level estimates for the prevalence of current smoking from 2017 to 2021. However, the significant percentage change estimates for the black population are suspicious. As a technical matter, the Centers for Disease Control and Prevention (CDC) instruct researchers to estimate prevalence from the BRFSS with survey weights in combination with strata and primary sampling units (PSUs). Still, the supplementary section makes no mention of strata or PSUs. Regardless, the observed net increase in smoking among black adults, instead of a significant decrease, considerably departs from what researchers expected.

These results undermine the saliency of tobacco flavor ban policies, especially menthol cigarette prohibitions. Like illicit drugs, the black market organizes to fill the void when regulated sellers can no longer legally provide products. In the case of Massachusetts, surrounding states, like New Hampshire, have a cigarette tax that is almost half of that in Massachusetts. This means that when the black market was able to organize, in many circumstances, it could buy cigarettes in New Hampshire and offer buyers in Massachusetts cigarettes at a lower price relative to the previous pre-menthol ban market, which increased access to cigarettes overall.

Much of the original motivation to pursue a menthol cigarette ban was to try to achieve “health equity,” which meant addressing disparities in health between black and white Americans. Although black adults and youth have historically smoked less than whites, the medical literature often reports that they “suffer disproportionately from tobacco-related diseases compared to non-Hispanic whites.” These observations have led influential public health institutions to advocate for menthol cigarette bans, hoping to reduce smoking in the black community further to improve health outcomes. 

But, with the flavor ban in Massachusetts leading to more cigarette sales in the region and an increase in smoking among black women, it seems clear that menthol prohibitions are ineffective mechanisms for improving public health in the black community. Instead, public health officials should promote safer alternatives to combustible cigarettes, such as e-cigarettes, which have proven effective in helping smokers quit.

The post Massachusetts menthol ban increased smoking among black women, research finds appeared first on Reason Foundation.

The ban has served as a test for what other states and municipalities might expect if they enact similar prohibitions on flavored tobacco products. Although officials often promote tobacco control policies as ways to protect public health, the unintended consequences of menthol cigarette bans on total cigarette sales have puzzled many public health officials and raised important questions about the effectiveness of the prohibitions.

In my analysis of the comprehensive flavored tobacco ban implemented in Massachusetts, the data show that the prohibition of menthol cigarettes was followed by millions of additional cigarette sales in the six-state region of Massachusetts and its bordering states. The year following the ban on menthol cigarette purchases saw 15 million fewer packs of menthol cigarettes sold than the year before the ban. However, approximately 22 million additional packs of nonmenthol cigarettes were sold in those states in the year after the flavor ban, leading to a net increase in cigarette sales.

In the 12-month period following the implementation of the comprehensive flavor ban in Massachusetts, the state sold 29.96 million fewer (22.24% less) cigarette packs compared to the prior year. However, a total of 33.3 million additional cigarette packs were sold during the same post-ban period in the counties that bordered Massachusetts in the states of Connecticut (3.05 million additional packs), New Hampshire (25.84 million), New York (1.04 million), Rhode Island (6.01 million), and Vermont (1.21 million). Thus, considering the change in cigarette sales in the entire six-state region, there was a net increase of 7.21 million additional cigarette packs sold in the 12 months after the menthol cigarette ban in Massachusetts, a 1.28% increase in cigarette sales compared to the prior 12-month period before the ban.

A paper by Samuel Asare et al. (2022) published in JAMA Internal Medicine publicized a reduction in cigarette sales in Massachusetts following the menthol cigarette ban but failed to include all but one of the bordering states in its analysis. Additionally, the paper analyzed Nielsen Retail Scanner data, which only represented approximately 30% of all US mass merchandiser sales volume that year. In contrast, the Management Science Associates Inc (MSAi) data in my analysis represents all cigarette distribution throughout the entire US.

In conclusion, policymakers must be careful about enacting prohibitions for a variety of reasons, including when the banned product is still available for sale in nearby municipalities. This is especially true when tax rates in neighboring states are relatively low. In 2020, the sales tax for cigarettes in New Hampshire ($1.78 per pack) was approximately half that of Massachusetts ($3.51 per pack), which further incentivized bulk purchases of cigarettes and allowed for a sizeable smuggling market for black market sellers after the flavored tobacco ban was implemented. 

With similar flavored tobacco prohibitions being proposed in states like Maryland, which currently has a cigarette sales tax of $3.75 a pack, policymakers should keep in mind that neighboring Virginia has a much-lower sales tax of $0.60 per pack and that the cross-border smuggling of cigarettes would inevitably follow a menthol cigarette prohibition in Maryland.

The data from Massachusetts and neighboring states show the menthol ban did not stop people from buying cigarettes, with sales increasing by seven million packs in the year after Massachusetts’ flavored tobacco ban. Massachusetts’ flavored tobacco ban primarily sent buyers to others states and illicit markets, so other cities and states should consider the real-world impacts of implementing similar prohibitions.

The post The effect of menthol bans on cigarette sales: Evidence from Massachusetts  appeared first on Reason Foundation.

Thank you for the opportunity to testify today. My name is Jacob James Rich, and I am a researcher at the Cleveland Clinic Center for Value-Based Care Research pursuing my Ph.D. at the Case Western Reserve University School of Medicine. I am also a health care policy analyst at Reason Foundation, a 501(c)3 nonprofit policy research organization. I write academic research on how to reduce tobacco use and was recently awarded Case Western’s Diversity, Equity, and Inclusion (DEI) award to pursue research that addresses health disparities among marginalized populations.

The potential regulation of flavored tobacco in the city of Columbus is designed to reduce tobacco use, particularly among communities of color. Given that rates of lung disease among black Americans are higher than other populations, even amid lower rates of historic tobacco use, pursuing interventions to reduce smoking rates in this population should be applauded. However, there is little evidence that comprehensive tobacco flavor bans significantly reduce rates of smoking among adults or youth, and the criminal justice implications of a menthol ban may, in fact, further exacerbate health disparities in the black community.

Policymakers should be concerned about the differential racial impact of this regulation. Menthol cigarettes are preferred by the black population. Therefore, a menthol cigarette ban would likely allow most white people to freely and legally continue to smoke their preferred cigarettes, while communities of color would need to either travel outside city limits or source from unlicensed cigarette providers. This could be disastrous, as it may increase police officer confrontations and increase the number of street sellers who are more likely to sell cigarettes to young people.

Additionally, in just about every way possible, nonflavored cigarettes cause much more harm in the United States than menthol cigarettes. First, more people smoke nonflavored cigarettes than menthol cigarettes — both adults and youth. Second, people who smoke menthol cigarettes tend to smoke fewer cigarettes a day. Given these considerations, nonflavored cigarettes are typically the more addictive product, so a true public health approach would prioritize controlling nonflavored cigarettes. It is also not clear that the regulation will even reduce smoking.

Case Study: Massachusetts Comprehensive Tobacco Flavor Ban

On June 1, 2020, Massachusetts implemented a tobacco flavor ban. I authored an analysis that compared cigarette sales in Massachusetts after the flavor ban to the year prior to the ban, finding millions of additional cigarette sales in and around Massachusetts when combined with its bordering states. It is true that menthol cigarette bans reduce cigarette sales locally. However, if surrounding localities have lower cigarette taxes — just like they did near Massachusetts and do near Columbus — total cigarette sales actually tend to increase as residents drive across borders and buy cigarette cartons in bulk.

Conclusion

In conclusion, flavor bans at the local level have little effect on public health and potentially disastrous consequences for communities of color. Massachusetts has already conducted multiple raids after implementing its flavor ban, mostly in communities of color. I urge the city of Columbus to collaborate with community members in determining an inclusive approach to improving health outcomes among its historically marginalized populations.

Thank you for your time and consideration.

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