Author: Staff Writer

Michigan Raises Tobacco Purchase Age

Credit: Vitalii Vodolazskyi
Michigan has raised the age to purchase tobacco and other products containing nicotine from 18 to 21.
“This legislative package brings Michigan in line with the federal Tobacco 21 legislation, raising the state age for tobacco sales from 18 to 21. The package amends several acts to raise the age of sale for retailers, prohibit anyone under 21 from entering a tobacco retail store, and prohibit tobacco sales through the mail to anyone under 21,” Gov. Gretchen Whitmer stated after signing the bill into law.
The package also revises the disbursement of proceeds from the tax on cigarettes and other tobacco products. Senate Bill 576 also amends a portion of the Michigan penal code to require agents who distribute tobacco through the mail to verify that the recipient is 21 years of age, revising the previous age limit of 18.
The legislation states that the act will not apply to the Youth Tobacco Act, which now prohibits tobacco use for those under 21, rather than 18.
“The Tobacco 21 package aligns Michigan with progress at the federal level, and is an important step in keeping tobacco products out of the wrong hands,” said Senator Paul Wojno. “Kudos to Governor Whitmer for working with the me and my colleagues in the legislature to protect our communities and public health across the state.”
July 22, 2022
Swedish Match Beat Estimates for Quarter

Swedish Match on Friday reported second-quarter operating profit just above market expectations, boosted by growth in the U.S. market.
The target of an agreed $16 billion bid by Philip Morris International Inc, Swedish Match’s operating profit rose to 2.23 billion Swedish crowns ($22.47 million) from 1.96 billion a year earlier, according to Reuters. Analysts polled by Refinitiv had on average forecast a profit of 2.19 billion crowns.
The company’s snus in Scandinavia, cigars in the U.S. and tobacco-free nicotine product ZYN, according to CEO Lars Dahlgren, had shown an “impressive volume trajectory” in terms of sales in the quarter.
Group sales increased 23 percent to 5.56 billion Swedish crowns.
Elliot Investment Management is building a stake in Swedish Match and plans to oppose the pending PMI takeover.
It’s unlikely that Elliott will succeed in building a large enough stake in Swedish Match to stop the deal on its own, according to Mads Rosendal, an analyst at Danske Bank.
July 22, 2022
Marijuana Legalization Bill Back in Senate

Credit: Vitalii Vodolazskyi
Leaders in the U.S. Thursday Senate introduced sweeping legislation that would end federal prohibitions on marijuana more than 50 years after Congress made the drug illegal.
Senate Majority Leader Chuck Schumer’s Cannabis Administration and Opportunity Act (CAOA) would decriminalize weed on the federal level and allow states to set their own marijuana laws without fear of punishment from Washington, according to media reports.
Just over a year after first unveiling a draft version of the cannabis reform legislation, Senate Majority Leader Chuck Schumer, Senate Finance Committee Chairman Ron Wyden and Sen. Cory Booker formally filed the CAOA. The legislation is expected to shape the conversation around cannabis legalization going forward and portions of it are likely to find their way into other bills that could pass before the end of the year, according to Marijuana Moment.
The legislation includes both Democratic and Republican priorities: It expunges federal cannabis-related records and creates funding for law enforcement departments to fight illegal cannabis cultivation. It also establishes grant programs for small business owners entering the industry who are from communities disproportionately hurt by past drug laws, requires the Department of Transportation to research and develop a nationwide standard for marijuana-impaired driving, and restricts the marketing of cannabis to minors.
While marijuana legalization has spread rapidly across the U.S. over the past decade, Capitol Hill has not transitioned as quickly. Nineteen states now allow anyone at least 21 years old to possess and use the drug, and 37 states have established medical marijuana programs. National polls have consistently shown that roughly two-thirds of Americans back marijuana legalization, and support is even higher among younger voters.
The U.S. House of Representatives has twice passed its own sweeping marijuana legalization package, known as the Marijuana Opportunity, Reinvestment and Expungement Act. That legislation does not include much of the regulatory structure that’s part of the Senate bill, and also has a different tax rate.
And even if a bill were somehow to pass, it is unclear if President Joe Biden would sign it. He has repeatedly said he does not support federal weed legalization.
July 22, 2022
Many Comments on EU Tobacco Changes

Credit: Savvapanf Photo
An overwhelming majority of EU citizens who responded to a European Commission initiative say they support tobacco harm reduction products.
The Commission’s “Call for Evidence” on the legislative framework for tobacco control received an unprecedented level of feedback, with consumers of alternatives to tobacco products – vaping, heated tobacco and oral nicotine pouches – making their voices heard in huge numbers, according to EU Political Report.
More than 24,000 EU citizens responded to the call, launched by the Commission as part of its ongoing evaluation of what future EU tobacco laws will look like through revision of the Tobacco Products Directive.
The massive interest in the issue may surprise some and may put the European Commission on the back foot as has been seen by some as having previously failed to support ‘tobacco harm reduction’.
The 4-week public consultation, from May 20 May to June 17, had one of the biggest ever responses to a consultation. On average, calls of this length receive around 354 submissions. In recent years, only the “call for evidence” for a digital euro for Europe received a similar scale of a response, but still fell short of the 20,000 submission mark despite taking place over a longer period of time (10 weeks).
Of the 24.000 submissions, more than 90 percent came from individual EU citizens, suggesting the extent to which this issue is a priority for the European public at large. Many submissions came from citizens in Germany, Italy and Romania.
It showed that the biggest issue for citizens across all member states is the regulation of reduced-risk products such as e-cigarettes. On this, it has been argued that the Commission it out of sync with public opinion.
The Commission has favored the introduction of new restrictions on reduced risk products, including flavor bans and sale restrictions but some in the industry hope the public response could now force it to reconsider these plans.
In June, the Commission announced plans to prohibit the sale of flavored heated tobacco products in the EU. The proposal came, it said, in response to the “significant increase” in the volumes of heated tobacco products sold across the EU.
A Commission report showed a 10 percent pick up in the sales volumes of heated tobacco products in more than five Member States and overall in the EU, heated tobacco products exceeded 2.5 % of total sales of tobacco products.
An overwhelming majority of submissions supported tobacco harm reduction products, including vaping and nicotine pouches, as “critical tools” that have helped smokers to quit. Respondents were nearly unanimous in opposing any plans to restrict access to such products for adults over the age of 18.
July 22, 2022
Bloomberg: Juul Revenues Down Sharply

Juul Labs Inc. had its first quarter revenues plummet 23% from the prior year, according to people with knowledge of the matter, according Bloomberg.
The company received $259 million of revenue for the quarter ended March 31, said the sources, who say they saw the company’s results as it seeks financing alternatives.
“As we continue to operate in the market and go through the FDA’s review process, we are in the early stages of exploring a variety of options including various potential financing alternatives to protect our business and to address the impact of the FDA’s now stayed order so we can continue offering our products to adult consumers who have or are looking to transition away from traditional cigarettes,” a spokesperson for Juul said in a statement when asked for comment by Bloomberg.
Juul Labs had a loss of $28 million in the period, compared with earnings of $29 million for the same period a year earlier, based on unadjusted results before interest, taxes, depreciation and amortization.
In June, the FDA banned Juul products on US shelves, citing a lack of evidence demonstrating the overall safety of the company’s products, and noting Juul’s “disproportionate role in the rise in youth vaping.” Then the company won an emergency court order temporarily blocking the decision, and the agency separately stayed its order, allowing the company to keep selling products.
As of the first quarter, Juul had $323 million of cash on hand, down from $428 million at the same point last year, according to people who asked not to be identified because results are confidential for closely held Juul, according to Bloomberg.
Its debt totaled approximately $2.15 billion, including a $394 million term loan due in August 2023 and around $1.7 billion of 7 percent notes due 2025 that “payment-in-kind securities,” allowing the company to delay interest payments.
July 22, 2022
Deloitte Fined for Audit of Malawi Leaf Company
The Institute of Chartered Accountants in Malawi (ICAM) has fined Deloitte Malawi after finding the auditing firm guilty in cases involving its audits of Malawi Leaf Company.
ICAM conducted investigations through the Ethics and Investigations Committee and convened disciplinary hearings through the Disciplinary Committee on cases of its members, according to Malawi24.
In one case, ICAM says Deloitte did not give due diligence to the procedures in auditing Malawi Leaf Company (MLC) , a subsidiary of Auction Holdings Limited. Deloitte assured that AHL Group had complied with the applicable International Financial Reporting Standards.
The company was found guilty for this and the ICAM council has imposed on Deloitte a maximum penalty of a severe reprimand and a fine of 1.5 million Kwacha.
Between 2014 and 2016, ICAM says Deloitte did not give due diligence to the procedures in auditing and assured financial statements for the years in question that had errors and misstatements because they included fictitious sales made to Eastern Tobacco Company for $1.2 million.
The company was found guilty for this and the council has imposed on Deloitte a maximum penalty of severe reprimand and a fine of 1.5 million Kwacha.
However, Deloitte was found not guilty on a third charge related to overvaluing stocks in financial statements for 2014, 2015 and 2016.
July 21, 2022
Tobacco Auction Season Ends in Zimbabwe

Zimbabwe’s tobacco farmers are making their last deliveries as the tobacco auction season comes to a close.
The auction season, which started in March, closed on Wednesday, with more than 180 million kg of the golden leaf having been sold at an average price of $3.04 per kg.
However, due to the significant volumes that are still being received, the Tobacco Industry and Marketing Board (TIMB), said contract sales will continue until further notice. A mop-up sale will be conducted on August 17.
“This season was okay, although not as good as last year,” said Tafadzwa Mugwagwa, a small-scale farmer from Rusape, a farming region southeast of Harare.
“We experienced erratic rainfall, there was a dry spell and the rains were late. The crop was affected when we applied fertilizers but it picked again when the rains came, that’s why the crop wasn’t auctioned on time,” he told Xinhua, according to CTGN Africa.
While most farmers had already delivered their crops to the auction floors before the end of the selling season, many farmers from Manicaland Province said they are yet to bring all their crops to the market.
“We haven’t brought all the crops to the market, we still have tobacco crops back home because we didn’t finish harvesting on time. We were still curing tobacco in June,” said Dorothy Chigwededza, a tobacco farmer.
July 21, 2022
Joytech Parent Submits PMTA to FDA
China-based JWEI has announced today that they have successfully submitted a premarket tobacco product application (PMTA) to the U.S. Food and Drug Administration for a device created with “new innovative technology” that focuses on safety, harm reduction and is designed to curb underage use.
“JWEI has been a leader in this industry from the start and this milestone again reiterates our commitment to the industry and public health: ensuring our adult customers continued access to less harmful alternatives to traditional tobacco products, while setting a new standard preventing underage youth access.” said VP of JWEI Group Jason Yao.
JWEI is the parent to the brands Joytech, Eleaf, Wismec and Joyevita. The company did not offer additional information on the specific device submitted for the PMTA.
JWEI developed a set of principles to guide through every step of its new product development, led by safety and effectiveness studies in early 2019. “The design philosophy is the foundation and guide rails for designing, manufacturing, verifying, validating, and continuously improving innovative, responsible, reliable, and high-quality products,” the release states.
The limited product debut in the UK has received overwhelming recognition from users and commercial partners after a few months’ actual use, according to JWEI
“As one of the world-leading device manufacturers and innovators of e-cigarette and vaping products, JWEI has over 3,600 granted patents and multiple internationally recognized manufacturing and quality certifications (GMP, HACCP, ISO9001, ISO13485, EHS, and ERP),” according to a press release.
July 21, 2022
Vaporesso Gets Chinese Production License

Vaporesso, a wholly-owned subsidiary of Smoore, has obtained a production licence from China’s State Tobacco Monopoly Administration (STMA), the country’s top regulator of tobacco products.
The license gives Vaporesso products lawful status in the country, Hong Kong-listed Smoore said in a statement on Wednesday. The licence will be valid through July 2023, according to the South China Morning Post.
Smoore is among the first group of companies to comply with China’s tightened rules for the e-cigarette industry, which recently became regulated as a traditional tobacco product.
In March, STMA published final guidelines for the industry, which require that manufactures comply with certain technical standards, including permitted ingredients and additives.
Licensed manufacturers must also trade with downstream wholesalers on a transaction platform overseen by STMA, according to the rules.
Licensed manufacturers must also trade with downstream wholesalers on a transaction platform overseen by STMA, according to the rules.
Less than 50 e-cigarette related companies, including retailers and manufacturers, have met the new restrictions and received licences from the authority so far, STMA’s website shows.
There are an estimated 1,500 companies involved in the vaping industry, according to calculations by the Electronic Cigarette Professional Committee of China Electronics Chamber of Commerce (ECCC) last year.
However, more licenses are expected to be issued in coming months as regulators work through a backlog of applications, according to news reports.
July 21, 2022
NJOY Rumored to be Readying for Potential Sale
E-cigarette maker NJOY Holdings Inc has hired bankers for a possible sale of the company, the Wall Street Journal reported on Tuesday, citing people familiar with the matter.
The report added the privately held NJOY is likely to be valued at up to $5 billion, according to the sources who cautioned the process was still at an early stage and there was no guarantee a deal would materialize.
If NJOY does not receive a high enough valuation, the company could raise money and stay private, potentially paving the way for a future initial public offering, the Wall Street Journal said.
The e-cigarette maker is simultaneously exploring a new fundraising round and aims to raise between $300 million and $500 million, the report added.
NJOY has two devices that have received marketing approval from the U.S. Food and Drug Administration, including its Ace device and Daily disposables.
Late June, Bernstein analyst Callum Elliott wrote in a note that Altria could try to buy privately owned NJOY, which “has already succeeded with its PMTA process applications.”
Rival Juul Labs Inc said on Friday it was in the early stages of exploring several options, including financing alternatives, as the company deals with lawsuits and a probable ban on sales of its e-cigarettes by U.S. health regulators.
NJOY and Mudrick Capital Management, a majority owner of the company, did not immediately respond to a Reuters request for comment.
July 20, 2022