• July 24, 2024

PMI Suspends Zyn Sales Due to DC Probe

 PMI Suspends Zyn Sales Due to DC Probe
Photo: Swedish MAtch

Philip Morris International halted sales of Zyn nicotine pouches on its U.S. website as Washington, D.C., officials investigate the company’s compliance with the district’s ban on the sale of flavored tobacco products, reports The Wall Street Journal.

On June 17, the company’s Swedish Match North America division announced it had received a subpoena from the District of Columbia’s attorney general, requesting among other things information about the unit’s compliance with local restrictions on flavored tobacco.

A preliminary investigation by the company indicated that there had indeed been sales of flavored nicotine pouch products in the district. According to PMI, these related predominantly to certain online sales platforms and some independent retailers.

Swedish Match is currently conducting a full review of its sales and supply chain arrangement in D.C. and other U.S. localities where flavor bans apply.

Pending the investigation, PMI has suspended all online sales on Zyn.com. Sales on this platform have represented “a very small” percentage of the company’s U.S. Zyn volumes, according to PMI.

In the March quarter, Philip Morris’ shipment volumes of oral smoke-free product volumes surged by 40 percent, mainly driven by Zyn nicotine pouches in the U.S., where shipment volume reached 131.6 million cans.

Zyn has been available in the U.S. since 2014, but its sales have skyrocketed over the past year and a half, and its parent company is investing in Zyn capacity in the U.S.

Philip Morris bought Swedish Match in a $16 billion deal in 2022 as the company looked to reduce its reliance on cigarettes amid stricter regulations and a consumer shift toward alternatives to tobacco and traditional cigarettes.