Author: Taco Tuinstra

  • U.S. Menthol Decision Delayed Again

    U.S. Menthol Decision Delayed Again

    Photo: Alicia

    The Biden administration has again delayed its decision on whether to ban menthol cigarettes in the United States.

    “This rule has garnered historic attention, and the public comment period has yielded an immense amount of feedback, including from various elements of the civil rights and criminal justice movement,” said Secretary of Health and Human Services Xavier Becerra in a statement. “It’s clear that there are still more conversations to have, and that will take significantly more time.”

    Government officials declined to provide a new target date for the measure, saying they needed more time to hear from outside groups, especially civil rights activists.

    Menthols account for more than a third of all cigarettes sold in the U.S. each year and are predominantly used by Black and Latino smokers.

    According to The Wall Street Journal, lawmakers have been weighing the potential public health benefits of banning minty smokes against the political risk of angering Black voters in an election year.

    A November poll commissioned by Altria Group found that 54 percent of “core” Biden voters—defined as minority voters or non-conservative white voters under age 45—oppose the proposed ban.

    Anti-tobacco groups were aghast by the latest delay. “It is unacceptable and deeply harmful to public health that the Biden administration today has once again delayed issuing the final rule to prohibit menthol cigarettes,” said Yolonda C. Richardson, president and CEO of the Campaign for Tobacco-Free Kids, in a statement. “This decision prioritizes politics over lives, especially Black lives.” 

    The FDA formally proposed the ban in April 2022, saying there were 18.5 million smokers who preferred menthol brands in the United States.

    Anti-smoking activists say the cooling sensation of the menthol flavor makes it easier to start smoking and harder to quit. The FDA estimates that the menthol ban could reduce smoking by 15 percent in 40 years. Studies project that as many as 650,000 smoking-related deaths could be avoided.

    Researchers looking at similar moves in other nations estimated that a ban could result in nearly a quarter of smokers quitting, with the rest moving to nonmenthol cigarettes or managing to keep smoking menthols.

    In recent months, dozens of groups have met with administration officials to discuss the proposal. Among other concerns, opponents of the measure cite job losses and aggressive police targeting of Black smokers. An estimated 85 percent of U.S. Black smokers prefer menthol brands, according to market data. The FDA insists that enforcement would be against manufacturers rather than consumers.

    Critics, however, contend that tobacco companies are financing and fueling those fears. Richardson said she was disturbed to see the administration “parrot the false claims of the tobacco industry about support from the civil rights community.”

    “The fact is the menthol rule is overwhelmingly supported by Black civil rights, faith, public health, medical and other organizations,” she said.

    While other jurisdictions, including the European Union, have banned menthol cigarettes, the impact of such a measure would likely be greater in the U.S. because of their large market share. Reynolds American Inc. (RAI), which makes the market-leading Newport brand, earns about $7 billion from menthol cigarette sales a year, research by Goldman Sachs shows.

    Convenience store, gas station and wholesaler groups predict a loss of $34 billion in sales from menthol cigarettes and snacks and drinks purchased by customers. Some House Republicans have sent letters to the administration warning that the ban could have a disastrous effect on small businesses and that it could encourage cigarette smuggling that would benefit terrorist groups.

    Altria spokesman David Sutton said the company was also concerned about illicit sales as well as lost tax revenue and jobs.

    A study on the impact of a state flavor ban in California suggests the measure spawned a large market for illegal products there.

  • Pearce to Lead Cigar Association of America

    Pearce to Lead Cigar Association of America

    Photo: GIS

    Scott Pearce will leave his position as executive director of the Premium Cigar Association (PCA) and join the Cigar Association of America (CAA) as that organization’s new president.

    “Scott is uniquely positioned to grow and bring innovative lobbying and advocacy to CAA. His depth of experience working in industry and trade groups and his most recent experience with PCA provides CAA a leader who is prepared to take on the difficult issues our association faces.” said Chris Howard, CAA board member and chair of CAA’s committee that sought out its new president.

    Pearce has over 20 years of experience working in associations with a strong track record of driving growth and implementing innovative strategies.

    His last day with the PCA, which Pearce led since 2018, will be May 24, 2024. In the interim, Deputy Executive Director Joshua Habursky will fill the vacancy and oversee operations in coordination with PCA’s executive committee and board of directors.

     “We are grateful for Scott’s time at PCA that saw transformative positive changes for the association from advocacy to trade show and especially grateful that he was able to work with us to hire an incredible team that will have a lasting legacy even after he leaves the organization,” said PCA Board President Scott Regina in a statement.

     “With change comes opportunity,” said Habursky. “Scott was part of a team of staff and a board of directors that resurrected an organization that faced tough times during the pandemic. The association is in a strong position and will continue to be the advocacy leader for premium cigars, host its world-class trade show, and grow all facets of its membership with our existing team.”

  • Vape Companies Urged to Implement Graphic Warnings

    Vape Companies Urged to Implement Graphic Warnings

    Image: natatravel

    The Philippines’s Department of Health (DOH) is urging businesses, distributors and importers to start printing graphic health warnings (GHW) on vaporized products, reports Tribune.

    The first set of GHW templates for vape products is set to take effect on May 12.

    Under Republic Act No. 11900, also known as the Vape Law,

    Operators who fail to comply with the new rules risk fines of between PHP2 million and PHP5 million and imprisonment of up to six years.

    Manufacturers, importers, distributors and sellers may also face revocation or cancellation of permits and licenses as well as immediate recall, ban, or confiscation of products at the direction of the Bureau of Internal Revenue.

    In addition, foreign individuals found in violation risk deportation.

  • Weight-Loss Drugs Lower Nicotine Cravings

    Weight-Loss Drugs Lower Nicotine Cravings

    Photo: Semi

    GLP-1 weight-loss drugs, such as Ozempic, Wegovy and Zepbound, suppress not only appetite but also nicotine cravings, reports Quartz, citing a new report from Morgan Stanley.

    The investment bank asked 300 GLP-1 users about their consumption habits while taking the medication.

    While 40 percent of survey respondents said they smoked cigarettes at least weekly before starting a GLP-1 treatment, that number fell to 24 percent after they started the treatment. Meanwhile, weekly e-cigarette usage dropped from 30 percent of respondents to 16 percent after they started taking a GLP-1.

    Anecdotal evidence from patients and healthcare providers suggests GLP-1s can help users curb their addictions to tobacco.

    While research has yet to prove a causal link between the two, clinical trials are currently underway to better understand the effects of GLP-1s on tobacco consumption.

    Demand for GLP-1 drugs has grown rapidly recently. Morgan Stanley expects the global market to reach $105 billion by 2030. It projects that the weight-loss medications will be adopted by about 31.5 million U.S. people, or about 9 percent of the nation’s population, by 2035.

  • Suppliers Updated on New U.K. Landscape

    Suppliers Updated on New U.K. Landscape

    John Dunne (Photo: UKVIA)

    John Dunne, director general of the U.K. Vaping Industry Association (UKVIA), traveled to China to educate vape companies on Britain’s changing regulatory landscape.

    The U.K. will ban disposable e-cigarettes from April next year, and the Tobacco and Vapes Bill, which is currently working its way through Parliament, seeks to give ministers unprecedented powers to ban flavors and decide how vapes are packaged and sold.

    Speaking at the headquarters of the Electronic Cigarette Industry Committee of the China Electronics Chamber of Commerce (ECCC), Dunne shared his expert knowledge to conduct on-site compliance training to some of the world’s leading vape companies, including Elf Bar, SKE, ELUX, HQD, Hangsen, Greensound, Aspire, ICCPP, RELX, ALD, Uwell and Zinwi.

    Describing the U.K. regulatory landscape as “complex and changeable,” Dunne said issues such as the protection of minors, battery recycling and environmental protection were high on the agenda of politicians, regulators and the general public.

    “It is absolutely vital that all companies operating in the U.K. are fully compliant with all local laws and work at all times to show the industry in the best possible light,” he said in a statement.

    Dunne said the UKVIA would continue to work with the ECCC to help members comply with current requirements, prepare for future regulatory change and to foster global cooperation to promote the development and prosperity of the global vaping industry.

  • Altria Reaffirms Guidance

    Altria Reaffirms Guidance

    Photo: Maurice Norbert

    Altria Group reported net revenues of $5.58 billion for the first quarter of 2024, down 2.5 percent from the comparable 2023 period. Revenues net of excise taxes declined 1 percent to $4.72 billion. The company reaffirmed its 2024 full-year adjusted diluted earnings-per-share guidance range of $5.05 to $5.17.

    Altria attributed the income declines to lower net revenues in the smokeable products segment, partially offset by higher net revenues in the oral tobacco products segment and the “all other” category.

    Marlboro’s retail share of the total cigarette category was 42 percent, unchanged from the prior year. The brand’s share of the premium segment was 59.3 percent, an increase of 0.7 share points versus the prior-year period.

    The company shipped 1 million Njoy devices and 10.9 million units of Njoy consumables during the quarter. Njoy held a 4.3 percent share of the U.S. mini-outlet and convenience channel segment.

    “We made meaningful progress in pursuit of our vision, and our highly profitable traditional tobacco businesses continued to perform well in a challenging environment,” said Altria CEO Billy Gifford in a statement, referring to the company’s ambition “to responsibly lead the transition of adult smokers to a smoke-free future.”

    “In spite of the absence of an effective regulatory environment, we saw continued early momentum from Njoy and believe our businesses are on track to deliver against full-year plans.

    “We also demonstrated our continued commitment to maximizing the return on our investments and delivering strong shareholder returns through the sale of a portion of our investment in ABI and the subsequent expansion of our share repurchase program in March,” Gifford said, referring to Altria Group’s March sale of 35 million ordinary shares of Anheuser-Busch InBev.

  • U.K. Misleading Public

    U.K. Misleading Public

    Mora Gilchrist (Photo: PMI)

    Philip Morris International has accused the U.K. Department of Health of spreading misinformation about heated-tobacco products after a social media post warning that “all forms of tobacco are harmful,” reports The Grocer.

    A tweet posted by the department in a thread of “myths” about vaping and tobacco contained false and misleading statements and risks driving consumers back to cigarettes or dissuading current smokers from making the switch to alternatives, according to the multinational.

    “What hope do adult smokers have when seeking out accurate information on smoke-free products if it’s the government that’s spreading misinformation?” said PMI Chief Communications Officer Moira Gilchrist.

    “All forms of tobacco are harmful, and there is no evidence that heated-tobacco products are effective for helping people to quit smoking,” the tweet stated.

    “Laboratory studies show clear evidence of toxicity from heated-tobacco products. Unlike vapes, there is no evidence they are effective for helping people to quit smoking,” the post continues, citing a 2017 report by the Committee on Toxicity.

    According to Gilchrist, such statements “distort the scientific evidence base” and “seriously misleads the public.”

    While acknowledging that heated tobaccos are not risk-free, Gilchrist said it is misleading to imply that all forms of tobacco are equally harmful.

    A Public Health England report in 2018 said that available evidence suggested that heated-tobacco products “may be considerably less harmful than tobacco cigarettes” but “more harmful than e-cigarettes.”

    The Grocer

  • KT&G Sued

    KT&G Sued

    Photo: Ian O’Hanlon

    A former KT&G Corp researcher has filed a lawsuit against his former employer claiming that he was insufficiently compensated for inventing “the world’s first e-cigarette” while working at the firm, reports the Yonhap News Agency.

    Kwak Dae-geun demands KRW2.8 trillion ($2 billion), reportedly the highest amount ever claimed by an individual in a South Korean legal action

    According to the suit, Kwak joined the Korea Ginseng and Tobacco Research Institute in 1991 and began developing a tobacco-heating product in 2005.

     In July that year, he registered his first patent for a prototype. In December 2006, he registered another patent for an upgraded version with a controllable heater.

    Subsequently, he developed a full e-cigarette set, and registered a patent for part of the device in 2007 before leaving the company in 2010 as part of corporate restructuring.

    After Kwak’s departure, KT&G allegedly registered patents for some of his technologies without recognizing his contributions.

    In addition to his claim about compensation, Kwak contends that a prominent rival global tobacco firm was able to commercialize its internal heating-based e-cigarette model in South Korea in 2017 due to the absence of overseas patents.

    Kwak’s requested damages reflects his portion of the revenue KT&G is expected to generate through Kwak’s patented technology during the 20-year patent term, as well as what KT&G would have earned if it had registered patents overseas.

    KT&G counters that it has properly rewarded Kwan in the form of offering a technology advisory deal, and that Kwak had agreed not to raise any legal issues.

    The firm also said the technologies invented by Kwak are not currently used in the products it is selling.

    The e-cigarettes being sold by the global firm in question, meanwhile, did not involve technologies patented by Kwak, according to KT&G, which also noted that the rival firm had already commercialized early-model heated tobacco-type products in 1998.

  • Sampoerna Profit Jumps by One Third

    Sampoerna Profit Jumps by One Third

    Photo: Taco Tuinstra

    Net profit of Sampoerna grew 28 percent to IDR8.1 trillion ($501.11 million) in 2023. With shipments of 83.4 billion cigarettes, the company remained the undisputed leader in Indonesia, claiming a market share of 28.6 percent.

    “2023 marked a year of return to robust profitable growth, with Sampoerna reaching significant milestones for advancing scientifically substantiated smoke-free products, increasing its investment and employment in Indonesia, and generating strong multiplier effects, in line with the country’s priority to enhance down-streaming.” said Sampoerna President Director Vassilis Gkatzelis in a statement.

    Sampoerna’s performance was driven in part by the recovery of the hand-rolled kretek cigarette (SKT) segment in Indonesia. After declining for many years, its share rose from 17 percent of overall tobacco sales in 2019 to 28 percent in 2023, boosted by the government’s favorable tax treatment of this labor-intensive sector.

    In early 2024, Sampoerna added SKT production facilities and third-party operators, creating employment for tens of thousands of new workers.

    The company has also been developing its smoke-free portfolio in Indonesia. In 2023, the company inaugurated a dedicated factory in Karawang, near Jakarta, which supplies both the domestic market and customers in the Asia Pacific region.

    In the Jakarta urban area, the company’s IQOS tobacco-heating product reached a market share of 3.5 percent in the fourth quarter of 2023, an increase of 2 points from the fourth quarter of 2022.

    To date, Sampoerna has invested $300 million in smoke-free products in Indonesia.

    Gkatzelis will leave Sampoerna in May and join Philip Morris International’s executive leadership team as president of the East Asia, Australia and PMI duty-free region.

    His successor at Sampoerna is Ivan Cahyadi.

  • EU Urged to Adopt Science-Based Strategy

    EU Urged to Adopt Science-Based Strategy

    Photo: yavdat

    Consumer representatives are urging European policymakers to adopt science-based tobacco harm reduction strategies as EU health ministers gather in Brussels for a two-day meeting to discuss Europe’s Beating Cancer Plan, among other topics.

    The Beating Cancer Plan presents several legislative initiatives to address cancer risk factors, including measures to reduce tobacco and alcohol consumption and improve healthy diets.

    “This meeting should mark the beginning of driving the EU towards a smoke-free future,” said Michael Landl, director of the World Vapers Alliance, in a statement. “Health ministers should take inspiration from Sweden, poised to become the first smoke-free country in the world, thanks largely to the adoption of safer and less harmful alternatives. It remains vital that the EU follow their example and enforce sensible regulation.”

    However, according to Landl, the EU Commission has thus far been “deaf” to the science of tobacco policies. “It is crystal clear that safer nicotine alternatives such as vaping or pouches are significantly less harmful than smoking and effectively aid in smoking cessation,” he said.

    “EU health ministers have a critical opportunity this week to advocate for sensible regulations that could prevent 700,000 unnecessary deaths annually due to smoking. The Beating Cancer Plan acknowledges that vaping can help smokers quit. Politicians must act accordingly. ”