Author: Marissa Dean

  • VLN Selling Briskly in Montana

    VLN Selling Briskly in Montana

    Image: Tobacco Reporter archive

    22nd Century Group’s VLN reduced-nicotine content cigarettes are selling robustly in more than 80 Town Pump convenience stores across the U.S. state of Montana, the company announced in a press note.

    “Launching VLN statewide with Town Pump, the No. 1 c-store in the state, is a big win for adult smokers in Montana seeking an effective solution to break the chains of nicotine addiction,” stated John Miller, president of tobacco products for 22nd Century Group.

    “We continue to see a pattern where, once available in stores, strong interest from adult smokers looking for new solutions to cut their smoking habit fuels initial trial and then often adoption and repeat purchase of VLN. We are excited VLN will be available in dedicated partners such as Town Pump stores given their reputation for providing customers with excellence.”

    “We continue to expand the availability of VLN to a growing audience of adult smokers proactively seeking this innovative new product,” said James Mish, CEO of 22nd Century Group. “We expect to increase store counts in key markets and new states throughout the rest of 2023 and into 2024 based on the launch timelines being communicated to us by a growing list of retail chains across multiple categories where cigarettes are sold.”

  • Black Market for Tobacco Doubles

    Black Market for Tobacco Doubles

    Credit: Zero Photo

    The illicit cigarette trade in Kenya has more than doubled in three years, according to BAT Kenya, reports Business Daily. The company says illegal sales accounted for 25.5 percent of the market last year compared to 11.3 percent previously.

    BAT Kenya says the increase is due to increased taxes, according to a third-party survey.

    “This [shrinkage of legitimate market] has been further exacerbated by the resultant differentials in excise rates between Kenya and its neighboring EAC (East African Community) partner states, with the excise payable in Kenya being double that of Uganda and almost triple that of Tanzania,” BAT Kenya wrote in its annual report for the year ended December.

    “To address this dire situation, we continue to call upon the government to enhance local deployment of resources and enforcement as well as collaboration with neighboring governments against the illicit trade in tobacco products.

    “Effectively, in 2022 alone, excise duty has increased by 21.3 percent and cumulatively by over 50 percent since July 2019. Such an increase, which is ahead of the average inflation rate for the year, presents an unstable and unpredictable business environment,” BAT wrote in the report.

    “This has forced consumers to seek cheaper products in the illegal market.”

  • 22nd Century Signs New Distribution Agreement

    22nd Century Signs New Distribution Agreement

    Image: Tobacco Reporter archive

    22nd Century Group has entered into a new distribution agreement with Hub, a key Midwest-based convenience store and multi-channel distributor with warehouses located in Missouri and Kansas.

    22nd Century’s VLN products are now available for purchase by eligible Hub customers as a part of 22nd Century Group’s state and regional rollout program.

    “Hub is a critical conduit to a growing list of regional, independent and tribal retail outlets in the Midwest and a highly regarded wholesale tobacco products distributor with more than 60 years in its served markets,” stated John Miller, president of tobacco products for 22nd Century Group, in a statement.

    “By adding distribution to Hub’s extensive customer list, 22nd Century can expand retail points of sale in both existing and new served markets for its innovative VLN reduced-nicotine content cigarettes, the first and only combustible cigarette to secure a modified-risk tobacco product authorization from the U.S. Food and Drug Administration. Our VLN brand contains 95 percent less nicotine than contained in U.S. conventional cigarettes. As demonstrated by leading independent scientists, reducing the nicotine level in cigarettes has the potential to substantially reduce the enormous burden of smoking-related death and disease.”

    Hub runs warehouse operations in St. Louis, Missouri; Kansas City, Missouri; and Galena, Kansas, serving as a multi-channel industry-leading cigarette, tobacco and comprehensive distributor of tobacco-related products. Hub is a leading distributor of cigarettes in the Midwest, providing a comprehensive catalog of tobacco and tobacco-related products to more than 2,500 customer locations in Illinois, Kentucky, Iowa, Missouri, Kansas, Oklahoma and Arkansas. Hub customers include regional, independent and tribal accounts across its served market that sell tobacco products.

  • Albert Heijn to Stop Selling Tobacco

    Albert Heijn to Stop Selling Tobacco

    Image: Martin Bergsma | Adobe Stock

    Netherlands’ supermarket chain Albert Heijn will no longer sell cigarettes and other tobacco products beginning Jan. 1, 2024, according to NL Times.

    “Albert Heijn supports the movement toward a smoke-free generation,” the company wrote in a press release. “In order to achieve lasting behavioral change and a smoke-free generation, it is important that all selling parties and other players involved, large and small, work together on this. The Dutch government has announced that tobacco sales will stop at supermarkets as of July 1, 2024, and is preparing legislation for this. Albert Heijn will stop selling tobacco and related products in stores as of Jan. 1, 2024. Online sales have stopped since July 1, 2023.”

    Last year, supermarkets were ordered to stop publicly displaying tobacco products. Kruidvat stopped selling cigarettes in 2018 followed by Lidl later that year.

  • Industry Concerns Over Romanian Tax Plans

    Industry Concerns Over Romanian Tax Plans

    Image: Tobacco Reporter archive

    Romania’s finance ministry plans to increase excise duties on tobacco and nicotine products this year in addition to the excise calendar that has already been approved, causing tobacco firms concern, according to The Romania Insider.

    “The moderate five-year timetable for increasing excise duty adopted less than 12 months ago should have provided the fiscal predictability needed to combat illicit trafficking,” said Jorge Araya, director of the southeast Europe area for BAT. “It should not be forgotten that illicit trafficking also means decreasing revenues to the state budget, financing criminal networks and uncontrolled access to products that do not meet quality or hygiene standards.”

    Excise duty was previously increased in April of this year. Excise duties and cigarette prices in Romania are the highest in the European Union in relation to purchasing power.

    Araya argues that the tax increases make smuggling very profitable because cigarettes can be bought in neighboring countries at around half the price of those in Romania.

  • Tobacco Farmers Urged to Destroy Stalks

    Tobacco Farmers Urged to Destroy Stalks

    Image: Tobacco Reporter archive

    Zimbabwe’s Tobacco Industry and Marketing Board (TIMB) is urging tobacco growers who have not destroyed tobacco plant stalks to immediately destroy them to avoid carrying diseases and pests to the next crop, reports The Chronicle.

    The TIMB stated that according to the Plant Pests and Disease Act, tobacco stalks must be destroyed by May 15 every year. Failure to comply with regulations brings penalties, including contract suspension and monetary fines or imprisonment.

    “Against this backdrop, tobacco growers are being reminded that all tobacco stalks should have been destroyed by now. Those who have not destroyed stalks are reminded to destroy their stalks immediately to avoid carrying over diseases and pests to the next crop,” the TIMB stated.

    “As we destroy tobacco stalks, we are also reminded to observe the set tobacco legislative date of Sept. 1, the earliest date to transplant tobacco. Planting tobacco before this set date will attract penalties and sanctions.

    “If 10 percent of the contracted farmers are noncompliant, the responsible contractor will be penalized or suspended from operations until they comply fully. Therefore, no contractor will contract a farmer who has not destroyed their tobacco stalks. Any grower who has not destroyed tobacco stalks and has been contracted shall be de-contracted from that contract scheme. Please note that TIMB and Ministry of Lands officers are inspecting all fields and compiling lists of all noncompliant farmers.”

    A farmer’s first offense will incur a fine of $100 or the local currency equivalent for each hectare or part thereof in respect of which the offense is committed, imprisonment of up to a year or both a fine and imprisonment. A second or subsequent offense will incur a fine up to $200 or the local currency equivalent for each hectare or part thereof in respect of which the offense is committed, imprisonment of up to two years or both a fine and imprisonment.

    So far, Zimbabwe has sold over 280 million kg of tobacco. “Given that production has increased, let us take all the precautions to sustain the production and ensure we reach the target of 300 million kg by 2025,” the TIMB said. 

    Production is expected to increase by 8.5 percent year-on-year. Earlier this month, press reports suggested Zimbabwe would achieve its 300 million kg target ahead of schedule.

  • Germany to Ban Flavored Products

    Germany to Ban Flavored Products

    Image: Tobacco Reporter archive

    The German Bundesrat approved a third amendment to the Tobacco Products Act, which would ban flavored heated-tobacco products, according to Dokumentations und Informationssytem fur Parlamentsmaterialien.

    The amendment includes “alignment of EU rules banning flavorings and distinctive flavors in heated-tobacco products; definition of the heated-tobacco product and its classification as a smoking tobacco product or smokeless tobacco product, extended labeling requirements in the form of combined text and image warnings and an information message, extension of the ban on placing cigarettes and roll-your-own tobacco with a characteristic flavor on heated-tobacco products; [and] amendment of various sections of the Tobacco Products Act,” according to the German Bundestag website.

  • Nigeria Suspends Taxes on Tobacco

    Nigeria Suspends Taxes on Tobacco

    Image: Tobacco Reporter archive

    Nigeria’s president, Bola Tinubu, has suspended excise taxes on some locally produced goods, including tobacco, and telecommunications services that were introduced two months ago, reports Bloomberg.

    Tinubu signed the executive orders to “address business unfriendly fiscal policy measures and multiplicity of taxes,” according to his spokesman, Dele Alake.

    The order includes certain imported vehicles, single-use plastic products and domestically manufactured alcoholic drinks and tobacco. The excise taxes were introduced by Muhammadu Buhari in his last weeks in office.

    Tinubu “promised to run a government that will not make life difficult for Nigerians or asphyxiate corporate entities,” Alake said.

  • India: Sale of Excess Tobacco Allowed

    India: Sale of Excess Tobacco Allowed

    Image: Tobacco Reporter archive

    India’s Ministry of Commerce and Industry has permitted the sale of excess flue-cured Virginia (FCV) tobacco via auction platforms, according to The New Indian Express.

    The orders follow Chief Minister YS Jagan Mohan Reddy’s letter to Union Minister for Commerce and Industry Piyush Goyal requesting farmers be allowed to sell excess FCV after being negatively affected by the Mandous cyclone.

    “Of the total tobacco grown in 53,000 hectares, more than 50 percent of the area was severely damaged, due to which the farmers replanted the crop as there is no alternate crop,” Reddy wrote. “Mandous cycle caused tobacco growers to incur additional costs on the production of the crop during this year as the farmers were forced to go for replanting, which also forced the farmer to irrigate the crop during the season to save the crop. Cost of production increased heavily due to replanting, irrigation and increased labor costs.”

    FCV tobacco farmers affected by the cyclone are not in a monetary position to pay penalties for excess tobacco produced beyond authorized quantities. Reddy requested orders similar to those in Karnataka allowing the sale of excess FCV be issued to help tobacco growers in Andhra Pradesh.

  • PMI to Supply Below-Cost Vapes Down Under

    PMI to Supply Below-Cost Vapes Down Under

    Image: PMI

    Philip Morris will supply some Australian pharmacies with VEEV products at an 80 percent margin “introductory offer” if the pharmacies sign a supply deal directly with the company, according to The Guardian.

    The offer is on condition that pharmacies do not sell a pack of two VEEV pods for more than $14.90 or VEEV devices for more than $19.90, which is cheaper than the prices wholesalers can offer.

    Simon Chapman, emeritus professor of public health and tobacco control at the University of Sydney, accused PMI of “playing a long game here to wreck the prescription access model by disrupting the competition.”

    “PMI [has] been implacably opposed to the provision of nicotine vaping products via prescription, actively lobbying for a consumer model,” Chapman said.

    “Their efforts in Australia to eliminate competition via the 80 percent margin to pharmacists need to be considered in the context of its global ambitions to oppose prescribed access. Any tobacco company still actively marketing tobacco products and opposing effective tobacco control while ostensibly trying [to] promote a product with claims to move significant customers away from its tobacco products is trying to walk on both sides of the street.”

    PMI has been lobbying Members of Parliament to overturn the country’s ban on vaping.

    Pharmacy and health groups should urge members not to prescribe VEEV products or enter into agreements involving VEEV, said Chapman.

    The pharmaceutical Society of Australia (PSA) urged pharmacists to be skeptical of PMI’s offer. “There are currently no nicotine vaping products registered on the Australian Register of Therapeutic Goods, and no company should be advertising unregulated products to Australian healthcare professionals,” a PSA spokesperson said.

    Nick Zwar, chair of the Royal Australian College of General Practitioners smoking cessation advisory group, said general practitioners “would want to know if it was a product that was owned by a tobacco company.”

    “Our view is that medicine should be distributed through national wholesalers because that provides comfort to the doctors and the pharmacies that these products are being treated as medicines as they should be,” said Richard Lee, CEO of Liber Pharmaceuticals. “Anybody can present a script anywhere, whereas under the Philip Morris arrangement, people will have to present a script at a pharmacy that has done a deal with Philip Morris to get that product.”

    “We have always been open and transparent about the fact we will work within whatever legal and regulatory framework exists for these products in Australia,” a PMI spokesperson said. “This is in stark contrast to dozens of other vaping companies who are providing their product via the black market.”