Novel cigarette pricing policy linked to decrease in sales in California city

FOR IMMEDIATE RELEASE

Contact:

Jillian McKoy, jpmckoy@bu.edu 

Michael Saunders, msaunder@bu.edu 

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Novel Cigarette Pricing Policy Linked to Decrease in Sales in California City

A new study found that an Oakland, Calif. law requiring cigarette prices to increase to a minimum of $8 per pack led to a decline in sales, suggesting that these minimum floor price laws could complement tobacco taxation to reduce smoking rates. 

Tobacco price policies, such as taxation, are effective public health strategies that have long shown to reduce tobacco use by raising the prices of cigarettes and other tobacco products. Minimum price floor laws (MPFL)—which set prices below which cigarettes can not be sold—are a somewhat newer fiscal tool that may also discourage tobacco use, according to a new study led by a Boston School of Public Health (BUSPH) researcher.

Published in the journal Tobacco Control, the study examined cigarette and cigar sales in Oakland, Calif., after the city implemented an $8 floor price per pack/package of cigarettes and cigars in 2020. The MFPL led to a 15-percent decrease in cigarette sales overall and a 25-percent decrease in sales of lower-priced cigarettes during the first 17 months of implementation.

Notably, the study also examined whether these MFPLs pushed consumers to purchase tobacco products in the neighboring areas outside of Oakland, but they did not observe any changes in tobacco sales in these areas, nor did they observe that consumers switched from cigarettes to e-cigarettes or vaping products. 

“Our findings show that setting a minimum price on tobacco products can be an effective policy for reducing tobacco sales, especially in local jurisdictions that are preempted by state law from establishing an excise tax,” says study lead and corresponding author Dr. Justin White, associate professor of health law, policy & management at BUSPH. 

MFPLs may be particularly effective at curbing tobacco initiation and prevalence because they increase the cost of lower-priced tobacco products, which may deter purchasing by price-sensitive groups—including youth and low-income individuals—who are disproportionately burdened by smoking and related morbidity and mortality. Smoking remains the leading cause of preventable disease and death in the United States, and individuals who do smoke typically begin during adolescence.

The study didn’t assess the effects of the MFPL policy on specific subgroups of the population, but the findings suggest that low-income people would have also benefited from this policy. 

“Lower-income people also benefit disproportionately from these policies,” says Dr. White. “Because lower-income people tend to smoke more than higher-income people, they are more likely to cut back on smoking as a result of the policy. They benefit in terms of improved health, more savings on money they’d been spending on tobacco, and more healthcare cost savings from being less sick later in life.” 

For the study, Dr. White and colleagues from the University of California, San Francisco utilized retail scanner data to assess spending habits for cigarettes and cigars at more than 3,500 stores in and around Oakland, as well as the rest of California between August 2020 and December 2021.

Nearly all retail stores complied with the MFPL requirements for cigarette sales, while only seven percent complied for cigar sales. Along with various limitations due to the COVID-19 pandemic, many retailers reportedly had difficulty stocking cigar products that met a minimum pack size requirement that was enacted at the same time—resulting in lax enforcement of the MFPL by Oakland’s public health officials.

“Ultimately, lack of compliance for cigars meant that cigar prices did not go up as a result of the floor price policy,” says Dr. White. “Policy enforcement is a critical component for having public health policies work as intended."

The researchers also noted that smoking cessation products did not increase after the MFPL policy went into effect, which suggests that cessation promotion needs to be better integrated into tobacco policies. 

“We know that recommended approaches such as nicotine replacement therapy or prescription medications can increase smoking cessation, but only about one-third of people trying to quit use one of these approaches,” Dr. White says. “We need to make it easier for individuals to access evidence-based approaches, and there may be opportunities to use digital technology like smartphone apps and text-messaging programs to deliver timely support.” 

The study was coauthored by Serge Atherwood, research data analyst at UCSF, and Dr. Dorie Apollonio, professor in the Department of Clinical Pharmacy at the UCSF School of Pharmacy.

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About Boston University School of Public Health 

Founded in 1976, Boston University School of Public Health is one of the top ten ranked schools of public health in the world. It offers master's- and doctoral-level education in public health. The faculty in six departments conduct policy-changing public health research around the world, with the mission of improving the health of populations—especially the disadvantaged, underserved, and vulnerable—locally and globally.