Author: Marissa Dean

Manufacturers Enact Tracking System

Image: www.doglikehorse.com
About 20 local cigarette manufacturing companies signed agreements with Pakistan’s Federal Board of Revenue (FBR) for implementation of a track-and-trace system, according to ProPakistani.
The local companies have been forced to start implementation of the system due to vacation of stay orders from courts and the deputation of Inland Revenue officials. The FBR has been in a court battle for about two years over implementing the system; the FBR finally won the legal battle and is now enforcing the track-and-trace system at local factories.
Implementation is at different stages for each company; almost all local manufacturers have signed the agreements with the FBR and begun implementing the track-and-trace system. One company has fully implemented the system while six companies are manually stamping cigarette packs. Some companies have purchased applicators, and other companies have started test runs.
All manufacturing companies within the jurisdiction of Azad Kashmir have obtained stay orders against the system, however.
August 25, 2023
Romania Bans Flavors for Heated-Tobacco Products

Image: Dancing Man
Last month, the Romanian government enacted Governmental Ordinance No. 23/20.07.2023 amending and supplementing the Romanian Tobacco Law (GO 23). The move bans all flavored heated-tobacco products.
The law takes effect on Oct. 23, 2023.
Prior to enacting GO 23 under the framework of Romanian Tobacco Law, only cigarettes and roll-your-own tobacco were subject to the prohibition of characterizing flavors and containing flavorings in any of their components, such as filters, papers, packages, capsules or any technical features.
The aim of GO 23 is to extend this prohibition to heated-tobacco products and to impose more restrictive requirements on packaging and labeling of such heated-tobacco products, according to media reports.
For the first time, GO 23 enacts a legal definition of “heated-tobacco products,” which refers to “a novel tobacco product that is heated to produce an emission containing nicotine and other chemicals, which is then inhaled by user(s) and that, depending on its characteristics, is a smokeless tobacco product or a tobacco product for smoking.”
This definition will include any type of vaping devices that entail heating of tobacco in view of obtaining an inhalable emission containing nicotine and other chemicals.
Heated-tobacco products with any type of “characterizing flavor,” such as menthol, fruits, etc., will no longer be allowed in the Romanian market.
Additionally, each unit of and any outside packaging of heated-tobacco products must carry the mandatory message: “Tobacco smoke contains over 70 substances known to cause cancer.”
GO 23 also states that each unit packet and any outside packaging of heated-tobacco products for smoking must carry combined health warnings that observe all the requirements set out in art.
All producers and importers of heated-tobacco products in Romania must notify the Romanian Health Ministry within 90 days after the enactment of GO 23.
August 25, 2023
Vape Recycling Introduced in Switzerland

Image: SENS eRecycling
E-cigarette sales in Switzerland have increased over the past few years, with 10 million products imported in 2022. Most vapes end up in the landfill rather than being recycled as required by the Ordinance on the Return, Taking Back and Disposal of Electrical and Electronic Equipment.
In conjunction with various partners, SENS eRecycling has developed an industry solution for the environmentally friendly disposal of e-cigarettes, according to the company’s website.
Upon request, SENS eRecycling will deliver vape recycling bags to any e-cigarette sales outlet; the bags can be used to collect returned e-cigarettes and send them back to SENS eRecycling by post. Sales outlets and consumers can also hand in used vapes to any SENS collection point throughout Switzerland.
August 25, 2023
Juul to Restructure and Reduce Employees

Image: Andrii Yalanskyi
Juul Labs has announced a company restructuring aimed at reducing operating costs and positioning the company to continue to advance its mission during a period of regulatory and marketplace uncertainty.
According to a press release, the principal aim of this restructuring is to enable the company to maximize profitability and cash-flow generation while continuing to invest in its core priorities, which include delivery of high-quality products to its commercial partners, ongoing development of next-generation products, engagement with the U.S. Food and Drug Administration regarding Juul’s pending and possible future market authorization applications, and commercial growth consistent with compliance with all applicable laws and regulations.
With these operating cost reductions, Juul Labs says it is positioned to increase its adjusted EBITDA margins and generate meaningful free cash flow before litigation settlements. In doing so, the company will reduce its need to access capital pre-premarket tobacco product application, extend its time horizon to continue its pursuit of market orders from the FDA and generate positive equity value as the company pays down liabilities over time.
Juul says it remains fundamentally optimistic about the prospects for Juul Labs Inc.—“a view rooted in our belief that our technology and our pipeline of new innovations represent the most valuable ever brought forward to transition adult smokers away from cigarettes while combating underage use,” the company wrote on its website.
August 24, 2023
KT&G to Expand lil Hybrid 3.0 in South Korea

Image: 2Firsts
KT&G plans to expand distribution of its heat-not-burn product lil Hybrid 3.0 to 26,000 convenience stores in South Korea beginning Aug. 23, reports 2Firsts.
Lil Hybrid 3.0 has been available at official flagship stores and online platforms since its release on July 24. It will now be available in convenience stores across six metropolitan cities, including Seoul, Sejong and Gyeonggi.
August 23, 2023
Israel Updates Plan to Tackle Smoking

Image: Vlad
Israel’s health ministry has issued a request for public comments on an “action plan for all tobacco and smoking products,” reports The Jerusalem Post. The plan includes eventually raising the legal smoking age to 21 from 18.
“The phenomenon of smoking is very worrying, and under my leadership, we are determined to promote measures to reduce it and increase awareness of the harm smoking causes,” said Health Minister Moshe Arbel. “This demands a complex and joint effort, and we are committed to implementing the policy in a variety of areas of prevention and encouraging quitting to promote public health and protect youngsters and adults alike from this serious damage to health.”
“Given the dimensions of the spread of smoking, we have examined all possible measures and continue to act in many ways in order to raise awareness of the dangers of using these products,” said Moshe Bar Siman Tov, health ministry director-general. “We recommend adopting a strict policy and dramatic measures required by the necessity of reality, but it’s clear to all of us that the best way to stop smoking is not to start smoking.”
The action plan includes decisions on the prohibition of flavors, giving the ministry powers to enforce the nicotine concentration limit, limiting the volume of the filling liquid allowed for import, marketing and sale, requiring graphic warnings on all tobacco and smoking products and visual uniformity to the smoking and vaping products, a ban on the sale of disposable electronic cigarettes, selling tobacco and smoking products in designated stores only and reducing the number of points of sale, raising the selling age to 21, giving authority to the ministry to enforce a ban on advertising on the internet, equalizing taxation on e-cigarettes and other tobacco products, and applying taxation to nicotine intended for nonmedical use.
The ministry’s statement said that “e-cigs are the gateway to smoking for young people who start experimenting with them at a young age; there is not strong evidence that e-cig use helps smokers kick the habit compared to the proven safety of other means of withdrawal, such as smoking cessation workshops, nicotine gums and patches and medical treatment. The scientific evidence on the health damage of e-cigs in the short[-term] and medium-term is known and described in the literature as affecting the respiratory system, cardiovascular system, trauma and burns, the developing brain in children and the creation of addiction.”
August 21, 2023
Illicit Cigarettes Set to Dominate Pakistan

Photo: Taco Tuinstra
Illicit cigarettes may exceed legitimate tobacco sales in Pakistan within the next quarter, warn some industry insiders, according to Profit. The illicit products have already secured more than 40 percent of the market.
The tobacco industry has criticized the Federal Board of Revenue and the Ministry of Health for their perceived failure to curb the illicit market.
Sami Zaman, head of external affairs at Pakistan Tobacco Co., warned that if left unchecked, illicit cigarette sales could secure more than 50 percent of the market share in months.
Illicit cigarettes offer lower price points and many flavor options but lack proper taxation and legally mandated graphic health warnings.
The industry is having a hard time fighting this due to a supply shortage of legal products; 75 million kg of raw tobacco was secured for the entire cigarette manufacturing industry despite promises of 85 million kg, causing cigarette prices to increase dramatically.
The licit cigarette industry saw a 44 percent decrease in cigarette manufacturing during June 2023 followed by a 28.4 percent decrease from July 2022 to July 2023.
August 21, 2023
Call for Stronger Anti-Smuggling Rules

Image: Tobacco Reporter archive
Law enforcement and health authorities have called for stronger rules against the illicit cigarette trade in Vietnam, according to VN Express.
Most e-cigarettes that are sold in Vietnam are smuggled, according to a leader of the Vietnam Federation of Commerce and Industry. He added that there is not strict legal framework to control e-cigarette products.
“There should be a legal framework to control this product and reduce smuggling,” said Nguyen Hai Cong, head of the Department of Tuberculosis and Lung Diseases at Military Hospital 175. He noted that e-cigarettes are gaining popularity with young people and students, who seem to believe there is no risk to the products.
Many e-cigarette smugglers have been caught recently, according to Kieu Duong, head of policy and legal at Vietnam Directorate of Market Surveillance; 81 smugglers were caught in Hanoi in the first six months of the year with about 20,000 items confiscated. Recently, Hai Phong police confiscated 54,000 illicit products.
According to Duong, the highest penalty for smuggling these products is VND50 million ($2,100), which is not enough to dissuade criminals.
August 21, 2023
Official Accused of Promoting Tobacco

Image: Tobacco Reporter archive
Moses Kuria, Kenya’s trade cabinet secretary, has been accused by tobacco control lobby groups of promoting tobacco use, according to 2Firsts.
Kuria met with BAT representatives regarding the company opening a manufacturing facility in Kenya for tobacco-free oral nicotine pouches.
Lobbyists led by the Kenya Tobacco Control Alliance (KETCA) criticized Kuria for the meeting, accusing him of undermining efforts to control tobacco use. They alleged that the meeting violated regulations regarding interactions between public officers and the tobacco industry. The activists are concerned that Kuria’s support may diminish efforts to curb tobacco use and move farmers away from tobacco growing.
Following the meeting, Kuria expressed support for the tobacco industry on Twitter.
The tobacco industry contributes about 1 percent to Kenya’s GDP.
August 21, 2023
Kaival Amends Philip Morris Deal

Credit: More
Kaival Brands International (KBI) has amended its agreement with Philip Morris Products, a wholly owned affiliate of Philip Morris International, for the development and distribution of electronic nicotine-delivery system products in markets outside of the U.S.
Eric Mosser, CEO of Kaival Brands, the exclusive distributor of all products manufactured by Bidi Vapor, said in a press note that with more than a year of operational history for KBI and given the recent changes to regulations in international markets, it became clear that there were a number of opportunities to improve the terms of the original licensing agreement with PMI and reduce the burden of administering it.
“We are extremely pleased to reach an agreement that shall enable us to achieve our objectives. The revised licensing agreement simplifies the payment structure resulting in cost savings of approximately $2.7 million for the company over the lifetime of the license agreement,” said Mosser. “It also enables better predictability and forecasting for KBI and streamlines data reporting. Finally, we anticipate that the acceleration of royalty payments will be a net positive to our financial performance over the duration of the agreement.”
Under the terms of the amended agreement, the parties agreed to revise certain terms, which provide for, among other things, a fixed pricing structure with volume-driven increases and a recapture of nonrecurring engineering costs by KBI.
Accordingly, Kaival Brands expects a reconciliation payment of approximately $135,000. It projects approximately $300,000 in additional royalties to be earned through the end of 2023.
August 21, 2023