According to the Winston-Salem Journal, 22nd Century Group received a 180-day termination notice from Smoker Friendly International, ending their exclusive private-label manufacturing agreement effective Jan. 1, 2027. The contract, signed in January 2025 and originally set to run for five years, covers the production of cigarettes and filtered cigars for the retailer’s network of more than 800 independently owned stores.
The loss of the contract would represent a significant setback for 22nd Century, which derives nearly all of its revenue from manufacturing private-label traditional cigarettes and filtered cigars despite being known for its FDA-authorized very-low-nicotine (VLN) cigarettes. According to the WSJ, in the first quarter, the company’s traditional cigarette sales fell to $2.85 million from $5.01 million a year earlier, while filtered cigar sales declined to $873,000 from $1.1 million. The company employs about 40 people at its Mocksville, North Carolina, manufacturing facility.
The contract termination comes as 22nd Century continues a financial restructuring that began in 2023, including reverse stock splits to maintain Nasdaq listing compliance and workforce reductions. While its VLN cigarettes remain the only combustible cigarettes authorized by the FDA as a modified-risk tobacco product, the company has struggled to generate meaningful sales despite expanded distribution, and the current FDA has shown less emphasis on very-low-nicotine cigarettes while authorizing additional flavored e-cigarette products.
