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Vector Posts Record Quarterly Revenues

Photo: Phongphan Supphakank

Vector Group reported consolidated revenues of $378 million for the third quarter of 2022, up 26.6 percent over the prior year period.
Tobacco segment unit volume increased 30.1 percent compared to the comparable 2021 period. Liggett’s wholesale and retail market share increased to 5.7 percent each, compared with 3.9 percent and 4.2 percent, respectively, in the prior year period.
Reported net income declined to $38.9 million from $48.9 million.
Reported net income from continuing operations was $38.9 million, up from $29.9 million in the prior year period. Adjusted net income from continuing operations was $37.6 million compared to $33.9 million in the prior year period.
Reported operating income increased by $1.9 million to $83.9 million.
Tobacco segment operating income was down 4 percent to $88.1 million, primarily as a result of the company’s investment in its Montego brand.
“Vector Group delivered record tobacco quarterly revenues in the third quarter as we continued to capitalize on favorable market opportunities to substantially increase value and market share,” said Vector Group President and CEO Howard M. Lorber in a statement.
“Driven by the significant growth of our price-fighting Montego brand, Liggett’s wholesale market share in the third quarter was 5.7 percent, which is its highest market share since 1984. We have begun to gradually shift our growth strategy of Montego, which is now the second-largest discount brand in the United States, from volume-based to profit-based. As we move forward, we will continue to focus on optimizing long-term profit through the effective management of volume, pricing and market share growth.”

November 2, 2022
Tunisia to Sell State Tobacco Factory

Photo: Maksym Yemelyanov

The government of Tunisia has promised the International Monetary Fund (IMF) to sell a state tobacco factory, reports Reuters.
The pledge is part of a preliminary deal with the IMF for a $1.9 billion rescue package in exchange for unpopular reforms, including reducing food and energy subsidies, and reforming public firms.
The leader of Tunisia’s powerful UGTT union said his organization would strongly oppose the move.

November 2, 2022
Accessing Innovation

Photos: Chris Frenzi Photography

The GTNF 2022 once again delivered on its promise to promote respectful debate among stakeholders in the nicotine business. From Sept. 27 to Sept. 29, participants gathered at the Four Seasons hotel in Washington, D.C., to discuss the challenges and opportunities facing their business, with an emphasis on innovation—and the importance of making the fruits of that innovation accessible to consumers worldwide.
This year’s GTNF was noteworthy for the diverse lineup of participants. More than half of the forum’s participants were not employed by the tobacco industry, and at least 41 percent of speakers addressed the conference for the first time.
Below is a sampling from the conference.

Adam Afriyie: The U.K. Example
Adam Afriyie, Member of Parliament for Windsor and vice chair of the All-Parliamentary Group on Vaping, examined the successful U.K. approach to tobacco harm reduction and the lessons it might hold for other countries.
This was an appropriate time to do so, he insisted, with life returning to a semblance of order following the Covid-19 pandemic and regulators around the world poised to make decisions—“life-and-death decisions”—about alternatives to smoking.
Despite progress, smoking still kills 75,000 people in England yearly. Britain’s National Health Service spends about £2.5 billion ($2.82 billion) annually treating smoking-related illnesses. Every year, tobacco use results in economic losses of £17 billion through ill health, absence and low productivity.
Afriyie distinguished four elements in the U.K. approach, which started with Britain setting a target to make smoking obsolete by 2030.
Second, the government and the health establishment accepted the evidence that vaping and other smoking cessation products, such as patches, pouches and snus, are all part of the legitimate arsenal of weapons against smoking—a conclusion that was reinforced by the Department of Health’s conclusion that vaping is at least 95 percent less risky than smoking. “What matters is the relative harm,” said Afriyie. Rather than relying on conjecture, emotion or the fear of Big Tobacco, the government relied on data, he noted.
Third, the government regulated vaping as a consumer product, setting minimum standards for quality and safety, such as a requirement to sell e-liquids in child-resistant packs. This framework, said Afriyie, allows adults to make informed decisions while protecting children from marketing and harm. All new products must be registered with the Medicines and Healthcare products Regulatory Agency. While vapes are not considered medical products in Britain, this prerequisite installs a discipline among manufacturers to be cognizant of the evidence base behind their offerings, said Afriyie.
Finally, the government commissioned an independent review of the progress toward its smoke-free objective. Published in June, the Javid Kahn report concluded that Britain would miss its target if it continued on the current trajectory. To get the project back on track, Kahn suggested that vaping must be front and center of the drive to eradicate smoking. In light of widespread misperceptions about vaping—50 percent of general practitioners are unaware that vaping is less harmful than smoking—the report also recommended opening a conduit for the industry to communicate directly to smokers the benefits of switching from cigarettes to vapes.
While Afriyie was inspired by the level of technical innovations in nicotine-delivery products, he was less encouraged by the equally important innovation or evolution of regulatory frameworks internationally. For example, while heat-not-burn products have been thriving in Japan, vapes are nearly impossible to access in that country because they are treated as medical products rather than consumer products.
The World Health Organization, too, should adopt the U.K. approach, according to Afriyie. Unfortunately, the global health body’s direction of travel, he said, appears to be made in “smoke-filled” rooms lacking transparency. Rather than basing its policies on science, said Afriyie, the WHO’s stance on tobacco harm reduction products appears to be subject to influences that are not directly to do with public health.
Concluding his presentation, Afriyie addressed each of the stakeholders in the tobacco harm reduction debate. “My message to smokers is please stop. And if you can’t stop, choose a vaping device or a heat-not-burn product—but move on. My message to investors: Britain is open for business.” His comment drew good-natured laughter, but Afriyie was only half joking, reminding his audience that when it comes to smoking cessation products, Britain is a gateway to the world. “The U.K. regulatory imprimatur on your documentation is a sign of quality and an aid to marketing and acceptance around the globe,” he said.
“My message to industry: Be good. Conduct open, honest research,” said Afriyie. “If the answers aren’t exactly what you want, don’t hide the results. Every bit of extra information and knowledge that we gain through research is useful.” To regulators, Afriyie stressed the importance of following the science. “Follow the U.K.,” he said. “Do not let the perfect be the enemy of the good.”

Philip Evans: An Outside Perspective on Innovation
Philip Evans, senior advisor at the Boston Consulting Group, provided an outside perspective on the challenges and opportunities of transformation through innovation.
Evans started by reflecting on the successes and failures of other sectors that, like the tobacco industry today, had faced existential crises. He cited Netflix CEO Reed Hastings’ decision to walk away from the business of distributing DVDs in favor of streaming video, thereby transforming the company and creating staggering amounts of economic value—and contrasted that with BP’s fruitless attempt to rebrand as “Beyond Petroleum.”
What can such experiences teach the tobacco industry about transformation through innovation? Evans identified five lessons.
First, transformation requires a crisis—the more acute, the better. Transformation takes place regularly in the military—always after defeat, when generals are forced to fundamentally rethink their strategies. And one reason the fast-moving tech industry is so innovative is that when a crisis hits, it tends to hit quickly, which means it cannot be evaded.
Second, while companies can try to overcome their problems through mergers and acquisitions, this will not necessarily achieve the type of transformation that the tobacco industry is interested in. Evans cited the example of the American Can Co., a low-margin commodity business that transformed itself into a life insurance company by buying other businesses. “Over time, the only thing that transformed was the business card of the chief executive,” said Evans, adding that “a bunch of investment bankers probably got very rich in the process.”
The third lesson in transformation, according to Evans, is that it almost invariably takes new leaders to set a new direction—and those leaders need a single-minded, long-term vision along with the security and legitimacy to withstand short-term reversals, which is the fourth lesson. Evans notes that successful transformers were often led by a sole proprietor. Bill Gates was able to overcome the threat posed by the internet to Microsoft’s software-based business model in part because he was a uniquely powerful controller and owner of the company.
As the fifth lesson, Evans stressed the importance of a clearly articulated strategy and purpose. “Companies that lose their way cannot recruit good people,” he said. Talented candidates are attracted by the promise of growth and vitality, especially through innovation.
Evans then set out to dispel the myth that big companies are unable to innovate. “It’s untrue,” he said. To illustrate his point, he showed a chart plotting the number of patent filings against the population levels in America’s biggest cities. The cities with the most people clearly filed the most patents. “Innovativeness is a function of the breadth and comprehensiveness of the other ideas to which an individual is exposed,” explained Evans. “That exposure is much greater in a large network than it is in a small one. If appropriately structured, there can be positive economies of scale to innovation; big is indeed beautiful.”
The other secret of cities’ success in innovation is their lack of hierarchies. According to Evans, it’s the hierarchy rather than the scale that squelches the ability of many large organizations to innovate. If a large organization wants to be successful in innovation, it should replicate the hierarchy-free social structure of cities.
To illustrate his point, Evans showed charts revealing patterns of collaboration within Google, Apple and Amazon—companies that are large and innovative. While each of these companies operates in a different part of the innovation cycle, the charts revealed patterns of considerable collaboration.
Openness is key, according to Evans. Google, for example, is deeply networked in academia and does not assert intellectual property in the traditional sense.
This lesson was learned the hard way by the pharmaceutical industry toward the end of the 20th century. In the late 1980s, there was little collaboration among pharmaceutical companies, with each player jealously guarding its intellectual property. When large molecule biotechnology emerged in the early 1990s, many traditional pharmaceutical companies stuck to old models of who owns what—and therefore got marginalized.
In the ensuing decades, they were forced to buy their way back into the business by acquiring some of these biotech companies. According to Evans, the pharmaceutical companies have since learned their lesson. But the point, he noted, is profound: Innovation requires openness and sharing. “It is incompatible with a lot of the traditional ideas about exclusivity, secrecy and ownership,” he noted.

Brian King: Leading an Agency Under Scrutiny
There are plenty of reservations about the way in which the U.S. Food and Drug Administration’s Center for Tobacco Products (CTP) has handled its responsibilities. During a brief speech at the GTNF 2022 in Washington, D.C., the new director of the CTP, Brian King, did little to quell those concerns. He did, however, acknowledge the continuum of risk. “We do have certain products that are lower risk than combustible cigarettes, and that’s an important component of the dialogue,” said King.
King told attendees that there is an opportunity for the CTP to assess the risk of youth vaping initiation and counterbalance that with the opportunity for adults who use e-cigarettes to quit combustible cigarettes.
“I think that [the] public health standard is pretty critical to the work we do, and it’s definitely a guiding light in terms of my determinations and decision-making,” he said. “Ultimately, it comes down to the science … it’s very critical, to me, to ensure that we use that as our guiding light. And, of course, the onus is on the applicants to ensure that they are providing the most robust signs possible to inform decision-making.”
The FDA has long been criticized for its handling of the premarket tobacco product application (PMTA) process and is currently defending multiple lawsuits from vapor companies challenging its marketing denial orders (MDOs), including two from Juul Labs, which recently filed a lawsuit over the regulatory agency’s refusal to disclose documents supporting its MDO.
Juul claims the agency overlooked more than 6,000 pages of the data it submitted on the aerosols that users inhale, according to Joe Murillo, chief regulatory officer at Juul Labs, who also spoke at the conference.
King said that a sizeable portion of youth are still vaping flavored and disposable products. However, he also said that the potential benefits for adult smokers are “mutually exclusive” from youth uptake concerns. “I don’t think that they necessarily have to be separate; they can certainly be explored concurrently,” he said. “But again, we need to ensure that we’re considering the science from both ends when making our decisions.”
King said the agency is “continuing to make progress” on the estimated 1 million PMTAs for nontobacco nicotine products as well. He said over 90 percent of the applications have been completed. “We have 350 acceptances so far, and there’s about 800,000 that have received an RTA [a refuse-to-accept letter], and I’m hopeful that within the next few weeks we should be able to get through all 100 percent of those 1 million.”
Being accepted for review is only the first step in the PMTA process. There are six stages, or rounds, to the PMTA process. After acceptance is filing, then a substantive review before an action is taken. King called the first step an important one. “[It’s] an important step, and I’m committed to ensuring that we keep things moving as expeditiously as possible,” King said.
King recently told the AP that he believes “there’s a lot of really important science and innovations” that have occurred in the vaping industry in recent years, adding that the most notable is nicotine salts in e-liquids. “We know that when you smoke a tobacco product, it’s a very efficient way to deliver nicotine across the blood-brain barrier. So it’s been very difficult to rival that efficiency in another product,” said King in the interview. “But in the case of nicotine salts, you have the potential to more efficiently deliver nicotine, which could hold some public health promise in terms of giving smokers enough nicotine that they would transition [off cigarettes] completely.”
King also discussed the FDA’s ability to force companies to comply with its MDOs. So far, very few companies that have been told to remove their products from the market have complied. King said the agency has multiple enforcement options to bring both manufacturers and retailers to heel.
“We have several tools available to us, including advisory actions,” he said. “We also have regulatory enforcement actions, including voluntary recalls as well as various other requested recalls. We can also take administrative action, civil money penalties (in terms of manufacturers, that penalty cannot exceed $15,000 for any single violation or $1 million for any number of violations related to a single action),” explained King. “When it comes to judicial action, we can do seizure, injunction and also criminal prosecution. I will say that when it comes to enforcement and compliance, nothing is off the table.”
King also updated attendees on the FDA’s external review of the CTP’s procedures, which is being conducted by the Reagan-Udall Foundation. Lauren Silvis, a former FDA chief of staff, was named as chair of the panel that has been asked to “evaluate regulatory processes and agency operations related to tobacco to help the center address new challenges as it works to reduce death and disease from tobacco and achieve its public health mission.”
“Within only a few weeks of assuming this role, we were told that there would be an external evaluation,” said King. “I actually wholly welcome it. I think it’s a good opportunity, particularly with new leadership, to identify areas where we’re doing things very well but also identify areas where we can enhance our efficiency and effectiveness. I have had meetings with [Silvis] and her team, and I’m confident that we’re going to get very useful information.
“It’s an ambitious timeline, 60 business days, so it’s going to work out to about 90 days total. It should finish probably by the end of the year, mid-December, and I’m looking forward to the opportunity to hear the recommendations. And I do have a very open mind on this. I’m always for improvement.”
King expects there will also be opportunities for external engagement, including listening sessions. He could not provide specifics during the speech but said he welcomes feedback from others in terms of informing the CTP’s processes.
“It’s not a one-size-fits-all, but I do think that we have some great opportunities here,” he said. “I’m fully committed to listening to the evaluator’s input and ensuring that we use it in a very useful way … then we’ll take it from there … I’m sure many of you have heard publicly, my calendar is rapidly filling up, and we are meeting with many—I know I’ve met with several of you in the room already, and I value those opportunities to meet with folks from across the spectrum, whether it be industry or public health … to hear people’s insights, what your priorities are.
“And those have been very productive and helpful to me. I do listen. I think it’s a very useful opportunity to me in terms of hearing specifically what the recommendations are from industry and what are areas where you feel it would be useful for FDA to engage in to make your life easier in terms of submissions and applications and [what] processes are overly complicated and could be improved,” said King. “I’m fully committed to ensuring that happens.”

Panel Discussion: The Investment Climate
The 2009 Family Smoking Prevention and Tobacco Control Act charged the U.S. Food and Drug Administration with regulating tobacco products for the protection of public health, so, from one point of view, it was dismaying to hear a panelist on the investor panel of the recent GTNF describe how, under the tutelage of the FDA, the U.S. tobacco and nicotine market had become a resilient one for combustible cigarettes.
Of course, this being an investors panel, the panelist’s comment was less about the FDA and more about Altria, whose short-term fortunes are tied to a large extent to the resilience of the combustible segment and whose reduced-risk strategy was said by another panelist to be unclear. Altria’s appeal as an investment opportunity was contrasted with that of another U.S.-listed company, Philip Morris International, which has had success in moving its sales from higher risk to lower risk products.
The panelists discussed the proposed acquisition of Swedish Match by PMI, which, if it goes ahead, would allow PMI to use SM as a vehicle for marketing in the U.S. the heated-tobacco device IQOS, which has marketing approval and is the subject of an FDA modified-risk order but which is currently banned from being imported following a patents dispute, a ban that is being challenged in the courts. According to one panelist, Altria has an agreement with PMI to market IQOS in the U.S. until April 2024, but there is apparently a question mark over whether the agreement provides for Altria to extend the agreement for another five years.
This raises the question of how an Altria shorn of its right to market IQOS would fare. Well, apparently, Altria is said to be due to unveil a heated-tobacco product toward the end of this year, but with FDA approval necessary, it would take some time for the company to start commercializing a new product. One interesting comment made the point that while PMI was years ahead of Altria in the heated-tobacco product field, the two companies used to be one.
There seemed to be an assumption at times that PMI would easily be able to muscle in on the U.S. market, but not everybody was having that. One panelist made the point that Altria and other U.S. companies were likely to prove highly competitive, and another added that IQOS might not be welcomed with open arms by U.S. consumers who had access to a range of reduced-risk products, including e-cigarettes, which had out-competed IQOS on some other markets. But on the other side of this coin, PMI was said to be starting to widen the focus of its reduced-risk strategy in respect of product categories.
It would seem that a week is a long time in the investment arena. During the panel discussion, Altria was seen as being in a difficult position when it comes to vaping. Its investment in Juul Labs involved a no-competition clause, and Juul has suffered a setback in the form of an FDA marketing denial order (MDO). The panelists indicated that the MDO was being contested, however, and that it would be open to Altria to make an outright bid for Juul. Less than a week after the panel met, however, Altria announced that it had exercised its option to permanently terminate its noncompetition obligations to Juul.
Surprisingly, perhaps, threats raised by the potential cigarette menthol ban and the imposition of a very low-nicotine cigarette standard in the U.S. were not yet seen as particular drags on tobacco businesses’ appeal to investors since, partly because of likely legal challenges, they were seen as being some way off.
On a wider front, while PMI was seen as a growth company, it was said to be facing headwinds created by the strength of the dollar and its exit from Russia. Or not. One panelist said that only Imperial Brands had exited Russia completely and that he would be surprised if the other major companies, which had invested heavily in the country, had exited Russia without providing for a way back.
On a more general level, the investment case for tobacco was seen as strong, partly because most companies—the exception seems to be PMI—are undervalued but also because they offer strong and secure cash flows and high yields. This situation was said not to have changed but to be more appreciated now than it was two or three years ago, particularly in the face of a recession. And while the appeal of tobacco stocks would be negatively impacted by the current increases in interest rates, on the positive side, most tobacco company debt was at fixed rates. Still, environmental, social and governance issues comprised an overhang in respect of getting investors interested in tobacco stock.
The discussions were heavily skewed toward the U.S. market and U.S. companies to the extent that the chairman apologized for ignoring the world outside the U.S. and Europe. The upcoming EU directives on excise taxes and tobacco products were mentioned, the former in a fairly good light given that it seemed that harmonized taxes would not be set at the same level across product categories but at a lower level on less risky products. Such a rational policy seems at odds with the Tobacco Products Directive, which seems set to retain the irrational ban on snus.
BAT and Imperial Brands were said to be undervalued by investors. BAT’s multi-category reduced-risk portfolio was held up as the way ahead, and its success with Vuse was highlighted a couple of times. Mention was made of a new management at Imperial that was said to be getting to grips with the business, focusing on the areas where it could perform well, resetting its new-generation products business and creating an opportunity for some geographical divestments.

Panel Discussion: Global Regulatory Issues
It’s been almost 60 years since a U.S. Surgeon General first stated the dangers of cigarette smoking and 50 years since scientists found out that the inhalation of smoke rather than nicotine is the major cause of smokers’ health problems. With goals in tobacco harm reduction (THR) long set, regulators should be able to solve the problem and shape rational regulation, argued moderator David Sweanor, adjunct professor of law at the University of Ottawa. “In all cases, it’s only small steps forward. What would happen if we saw this as a matter of urgency and, for instance, allow more products at a time?”
Gizelle Baker, vice president of global scientific engagement at Philip Morris International, stressed the role of science as a basis for policymaking. “Science isn’t perfect, but it has evolved,” she said. “We need to look at the data we need in the future to correct our idea and come to conclusions that can drive policy. Because the only way to shape policy is to use science, data and facts.” Knowledge about long-term effects or which part of the population in certain countries will use a reduced-risk product (RRP) can only be gained if the products are put on the market, she stated.
Konstantinos Farsalinos, research fellow at Onassis Cardiac Surgery Center, noted that there are no missing data, only missing common sense. “We will never be fully informed about anything,” he said. “At one point, we have to make a decision.” The bar of proof for THR has been set extremely high, Farsalinos noted. In some markets, this forces smaller companies to leave the market to big companies that can afford the approval process. “We live in a high-risk society—let’s consider THR like any other harm reduction strategies,” he said.
Marewa Glover, director of the Center of Research Excellence on Indigenous Sovereignty and Smoking, spoke about New Zealand’s Smoke-Free Aotearoa 2025 Action Plan, which is currently under review and includes a smoking ban for all those born after 2008, a drastic reduction of legal retail outlets for RRPs and the reduction of nicotine content in combustible cigarettes to nonaddictive levels. Glover said the draft bill lacks not only common sense but also compassion. “The regulatory intent is to not allow vaping to become normalized but denicotinization,” she said. “As a smoker, you should switch to vaping temporarily and then quit completely. Anyone who quits vaping should never go back.” She predicted a domino effect on other countries and urged regulators not to follow the example of New Zealand.
The objective of THR, said Sharon Goodall, group head of regulatory science at BAT, is very clear: to reduce the number of smoking-related deaths. The sentiment of positivity that comes with this prospect should be maintained in the industry’s talks with regulators who are willing to change their approach toward THR. “We must not get distracted. We must react to individual events but remain focused on the long-term outcome. There are insufficiencies in the system, markets without open dialogue, therefore we must continue to work with regulators.”
Focusing on the role of market structure and competition in the U.S., David Levy, professor of oncology at Georgetown University, pointed out that before 2005, the cigarette industry was static and homogeneous and, for tobacco control, the epitomized enemy. After 2005, the market fragmented, with consumers using multiple products. After 2012, e-cigarettes quickly gained market share.
Tobacco companies responded by producing their own e-cigarettes. They played a role but didn’t control the market. Vaping became a highly competitive market. Recently, it has been joined by heated-tobacco products, which, Levy said, could play an important role as they solved problems e-cigarettes couldn’t solve. “Companies have to be serious in THR because it’s decisive for their businesses,” he said. “New Zealand and the U.K. have done well in THR. In low[-income] and middle-income countries [LMICs], such as India or Pakistan, oral nicotine could replace the highly harmful chewing tobaccos. However, restrictive policies, such as a ban of RRPs, will drive smokers back to cigarettes.” Levy saw clues for a closer cooperation between the industry and public health.
Fadi Maayta, president and co-founder of Alternative Nicotine Delivery Solutions, provided a snapshot of the situation in LMICs by portraying the Middle East and North Africa (MENA) region, which he called a forgotten region in the picture of THR.
Of the 547 million who live in the region, there are 140 million adult smokers. In some countries like Jordan, there is a smoking incidence of more than 60 percent, and cigarette sales are growing across the region. Governments are employing the typical measures to curb consumption, such as tax hikes and increases in customs. Saudi Arabia was the region’s only country to introduce plain packaging, which resulted in a burgeoning illicit cigarette market.
Eight out of the 22 MENA markets have regulated vape products whereas the remaining 14 have banned them altogether. In these markets, however, vape products are still around—and unregulated. But even in regulated markets, 80 percent to 90 percent of the markets are illicit products because the government followed an aggressive path when regulating the products, introducing a fiscal and regulatory framework that is stricter than that for cigarettes.
“Throughout the region, misinformation is polluting the whole idea of THR,” said Maayta. “Regulators rely on articles about the harm of e-cigarettes, instead [of] on robust science, and still believe that nicotine causes cancer.” An opportunity, he said, could be to cooperate with global THR associations.

Plenary Panel: Innovating for Tomorrow
When creating a smoke-free world, innovation must take place not only in terms of products but also in terms of regulation, communication and sustainability. That was one of the messages of the “Innovating for Tomorrow” panel discussion during the recent GTNF in Washington, D.C.
Ming Deng, head of the Next-Generation Products (NGPs) Industry Study at Yunnan University, spoke about his desire to make NGPs smart and mobile. At present, he said, the electronic functions that differentiate an NGP from a combustible cigarette just serve as a marketing tool. However, the Artificial Intelligence of Things (AIoT)—the combination of artificial intelligence and the Internet of Things—offers considerable opportunity to improve human-machine interactions and enhance data management and analytics, among other benefits. “With AIoT, producers could trace consumers’ needs and innovate products accordingly,” said Deng.
For Meisen Liu, R&D director at Shenzhen Zinwi Bio-Tech, lower temperature atomization is one of the most important objectives in current research as it is safer for human health. A higher atomization temperature causes atomizing agents to decompose into harmful aldehydes whereas atomizing agents with a low boiling point decrease the atomizing temperature and reduce the emission of harmful substances. Liu also described how nicotine salts derived from different acids had different properties regarding sensory stimulation or taste. His company, he said, had created a new type of nicotine salt that allows for enhanced stimulation in markets where the amount of nicotine in e-liquids is restricted.
Kevin Peng, advanced technology scientist at ALD Group, spoke about technologies to reduce the carbon footprint of vape product manufacturing and consumption. Earlier this year, his company launched a “green cigarette,” a disposable vape product featuring 6 percent lower carbon emissions than combustible cigarettes. The company also developed a super-slim pod for reusable vaping devices made from a material that has only one-third of the carbon emission of ALD’s older materials. This way, he said, his company had achieved a 50 percent emission reduction compared to other pod products.
ALD also conducted an emission assessment for its organization and products. “ESG [environmental, social and governance] is a much more difficult thing than we thought,” Peng stated. “We found that most suppliers are not very responsive in terms of such requirements.” He called for a unified industry ESG standard for suppliers, which would make it easier to reduce emissions.
To help accelerate its transformation, BAT established Btomorrow Ventures two-and-a-half years ago. Lisa Smith, the subsidiary’s managing director, related how Btomorrow had set up a number of innovative ecosystems. “It’s a highly competitive market,” she said. “It’s difficult to find the best innovators out there.” Her company’s role is to be the “handshake” to the outside world to show that BAT is an appropriate partner for innovators. Among the many tasks in BAT’s transformation are to quickly promote the ESG agenda and move beyond nicotine. In order to achieve the latter, she said, the company had to build science and credibility.
ICCPP, a provider of solutions for e-cigarettes and heated-tobacco products, believes that the key to innovation in vaporization might be the ceramic coil. The company, which focuses on research and manufacture of electronic atomizing technologies and is the parent company of the Voopoo vaping brand, introduced the world’s first nano-microcrystalline ceramic core in 2021. According to William Yu, vice president of global ODM business at ICCPP, the core is based on environmentally friendly mineral materials that result in an increased nicotine delivery and stable flavors. In combination with a powder-free technology and a porous structure, the core enables a significant increase in atomization, according to Yu. The company also develops environmentally friendly products, such as a disposable cigarette made from special recyclable paper.
Continuing to innovate is essential as the industry is at a crossroads, said George Cassels-Smith, CEO of Tobacco Technology Inc. (TTI). After the Food and Drug Administration, through its onerous market authorization processes, had “frozen” the U.S. market for next-generation products, TTI opened a new manufacturing site in Italy, which according to Cassels-Smith is more open to innovation. “It’s vital to involve science, which is one of the pillars of what is a quick-moving new technology,” he said. “It needs expertise to focus on this direction because, ultimately, we must find superior products to combustible cigarettes.”

Additional GTNF 2022 session summaries >>

November 1, 2022
Product Stewardship

Photo: Chris Ferenzi Photography

Product stewardship, which in general means the responsibility of a manufacturer for his product, is something everyone has a stake in. Regulators make sure that consumers get a product that is in a form that is supposed to be in accordance with its specifications. Because of their reputation and consumer experience, companies pursue the same goal.
More definitions of what product stewardship stands for in their respective companies were provided by panelists in the GTNF Product Stewardship panel discussion. Stefanie Miller, vice president of global scientific engagement at Juul Labs, said that when people outside the nicotine industry thought about product stewardship, labor conditions and the environment tended to be at the forefront of conversations. “At Juul, however, we’re presently in a major fight for our company because many people don’t understand the potential health benefits realized by having our product on the market.” Unlike Wall Street, where Miller worked as a tobacco industry analyst before joining Juul, Juul bases its decisions on science, she emphasized. “As product stewards, we must study every facet of our products so that we can have an open and honest discussion about how they impact adult smokers looking for less harmful alternatives. And we must hold to account those who propagate misinformation.”
As a toxicologist, Donna Smith, associate fellow of preclinical within regulatory sciences for Altria Client Services, said she worried about the individual health risk of a product. Given the right regulatory framework, she argued, the reduced-risk product (RRP) category could make a greater impact in this next decade than has been seen in the last 50 years. In her view, product stewardship consisted of three phases: First, the “identify” stage where the chemical ingredients of the product and their quality are assessed. Second, the calculation phase, during which the substances you have added to the product and the things the product is producing are determined so that the results can be compared to published values that are used in the same sense of evaluation, as is common for drugs, cosmetics or foods. Third, the “investigate/validate” phase, where your product is put through whatever biological testing the manufacturer feels necessary to demonstrate that this particular product doesn’t increase harm to the consumer. “Knowing what goes into their product and managing suppliers properly is the most important thing any manufacturer can do.”
As senior manager of global scientific engagement at Philip Morris International, Carrie Wade, who has a background in opioid addiction research, said she was sitting between the regulatory and product teams making sure everything runs smoothly. Her role in product stewardship is building trust with the stakeholders so that consumers are aware of what PMI is doing. “One thing I’d like to see improved is to reach harder-to-reach people who benefit the most from tobacco harm reduction (THR),” she related. “People with a lower socioeconomic status smoke more and die earlier. We can help them with a diversification of products and more affordable and appealing products that are less out of reach for these people.”
For Elaine Round, vice president of scientific and regulatory affairs at RAI Services Company, product stewardship starts with ingredients and safety assessments of devices and their components and requires a comprehensive quality management system as well as a postmarket surveillance system to monitor and address adverse events that may happen. “All these components go into FDA [U.S. Food and Drug Administration] applications and are being scrutinized by the agency,” she said. Product stewardship, she added, was ensuring that the reduced-risk products her company brought to market had maximized their harm reduction potential and offered the biggest possible benefit to the adult smoker.
Panelists agreed that there is still room for improvement. When Miller still worked at Wall Street, she observed how nicotine companies were unable to communicate the problem of e-cigarette or vaping product use-associated lung injury to regulators. For Round, getting a product to market is a major challenge, especially in the U.S. “RRPs are almost held to higher standards than other industries’ products because of the tobacco industry’s past,” she said.
By working in the field of product stewardship, panelists pointed out, they had been able to make a difference. Smith mentioned her team’s ability to have a lot of the infrastructure and expertise in place to move to where they see the consumer is going. Round related her pride after she and her team had put their first premarket tobacco product application together. Miller saw it as positive that Juul gets a lot of its science published. “It’s good to see it’s treated like any other legitimate science. This is the result of amazing product stewardship surrounding the product.”
To maximize efficiency of product regulation, panelists suggested to introduce consensus-type standards as are already in place for drugs and medical devices and to make sure that product standards were clearly communicated. No. 1 on their wish list, however, is the implementation of a standard for a product’s appropriateness for the protection of public health.

November 1, 2022
Clearing the Air: Policy That Better Serves Society

Photo: Chris Ferenzi Photography

The opening panel of this year’s GTNF looked at the challenges in shaping a sensible regulatory framework for reduced-risk products. The way researchers silo disciplinary expertise certainly is a contributing factor to the regulatory space for tobacco harm reduction (THR) being so polarized, argued Sam Hampsher-Monk, managing director at BOTEC Analysis. “Often, empirical research is presented in a decontextualized way,” he said. “Publishers of scientific media seem to look for articles on e-cigarettes true to the motto ‘the more extreme, the better,’ thus sacrificing the middle ground.”
Scientists, too, tend to surround themselves with people who think like them, he added, which leads to the creation of echo chambers. “With e-cigarettes specifically, part of the problem is that we’re using unexamined moral judgements to interpret the available evidence, but when we do this, we need to provide reasons for whatever judgement we make. As this rarely happens, an analytical conversation will quickly move to a subjective one.”
Hampsher-Monk said that no scientific contribution should be taken for face value but needed to be scrutinized regardless of authorship.
Empirical economist James Prieger, a professor of economics and public policy at the School of Public Policy at Pepperdine University, said that in other industries, such as telecommunications, it was common and unproblematic that economists were paid by companies to do research, whereas in tobacco research, any sort of funding from the industry or even indirectly from the industry was being ignored. However, the more people produce data, the better, he pointed out. “The industry has access to data that I as an academic could never replicate. On the other hand, I as an academic have access to arguably some more brain power. Put the data out there, and let it go through some refereeing process.”
For a recent study looking at the barriers to THR, Pritika Kumar, senior fellow for integrated harm reduction policy at the R Street Institute, spoke to social workers, psychologists, nurses and several harm reduction (HR) coalitions across the U.S. as well as physicians working in HR coalitions. The obstacles highlighted by participants included physicians lacking the training and experience of leading these conversations with patients other than advising them to quit or call a quit-line number. HR coalitions, which are funded by departments of health, should be tobacco-free, which has often led to bizarre rules; one doctor in a HR coalition told Kumar that people could bring their syringes but not their vapes. “The problem is that messaging around safer nicotine products is so inconsistent,” Kumar said. “While at the FDA’s website there are some hints at THR, the CDC’s [Centers for Disease Control and Prevention] site is all about how harmful these products are. Physicians don’t get clear information, which would be extremely important.”
Prieger stated that physicians and others needed sources of information that they could hand on to patients. He described the difference between the U.K. and the U.S. in the treatment of pregnant smokers: In the U.K., pregnant smokers having trouble quitting smoking during the first trimester receive a printed sheet with information about e-cigarettes and why pregnant smokers should switch. By contrast, in the U.S., the Pediatrician Association explicitly states that e-cigarettes are not safer.
Misconceptions about THR prevail in many parts of the world and have a big impact on decision makers in a situation where, as surveys have shown, 70 percent of doctors believe that nicotine causes cancer. To meet this challenge, the stakeholder groups that THR advocates are talking to need to be broadened, Kumar said. “The narrative is currently shaped by public health or well-funded public pressure groups. I see that politicians gravitate toward data that makes sense to them based on their constituents, not so much policy that is really informed by science. Policymakers have no idea how things unfold in enforcement.”
Ironically, THR products face most resistance among legislators in low-income and middle-income countries, where large parts of the population consume harmful forms of tobacco. In Russia, Indonesia, China, India and Bangladesh combined, there are about 700 million people who smoke combustible cigarettes. Most of these countries have banned e-cigarettes or enacted policies not favorable to THR. As moderator Sudhanshu Patwardhan, director of the Center for Health Research and Education, suggested, there seem to be only two policy options—either a free, Wild West-style market or a prohibitive market.
Hampsher-Monk rejected the thought of such a false dichotomy, though, saying that politicians often simply copy neighboring countries’ regulatory decisions. However, regulators need to make sure that the unintended consequences of their decisions don’t outweigh the benefits and avoid a replication of failures elsewhere. He explained that with smoking and nicotine use being complicated issues, it is rather unlikely that two populations will respond in the same way to the same regulations.
Panelists agreed that, in their endeavor to protect youths, health authorities greatly neglect the requirements of adult smokers seeking to switch to less hazardous alternatives. To the latter, flavors are an important criterion, so flavor bans hinder harm reduction efforts. On the other hand, studies have shown that the combustible cigarette and e-cigarette markets for youths are linked; a higher excise tax on vaping has shown to increase youth smoking. “The idea of protecting the children is diametrically opposed to helping adult smokers quit,” Hampsher-Monk concluded, “because if you forego a chance to help adult smokers quit, they will continue to model smoking to their children.”

November 1, 2022
Kingsley Wheaton

Photo: Chris Ferenzi

Kingsley Wheaton, chief growth officer at BAT, posed an interesting question at the recent GTNF. “So, we must be even more courageous, speak to the outside world further still and come together even more,” he said near the end of his presentation. “Greater collaboration is key. Is it time, for example, for the GTNF to move from the networked forum that it is to operating more like a fully fledged NGO [nongovernmental organization]?”
Such a suggestion certainly provides something to ponder. For instance, while I take it that, since the suggestion was put forward by BAT, such an NGO would be legally viable, how would it be viewed by those cynical of the tobacco/nicotine industry’s motives and skeptical about the direction of travel of tobacco harm reduction (THR) as mapped out by those who participate in GTNFs?
I imagine that the suggestion was prompted by a concern that, whereas the concept and application of THR principles have weaved and are weaving a certain magic, the spell might be broken without further impetus, without further change. Indeed, the word change was used 12 times in the presentation.
But why is change necessary? After all, Wheaton told his audience that “[i]n the U.K., the U.S., Canada, France, New Zealand, Japan and Sweden, the needle is moving toward tobacco harm reduction.” In the U.K., Japan and Sweden, he said, more than half of BAT’s revenues now come from new-category products while across Europe that figure was more than 20 percent.
Well, change is necessary, I guess, because, on the flip side, globally, the needle stubbornly refuses to move fast enough. Overall, five-sixths of the company’s revenues still come from combustible products.
Of course, there are any number of general and country-specific issues determining why the countries named have moved the THR needle further than many of those not mentioned have, and many of those issues cannot be addressed by the tobacco/nicotine industry. Indeed, it was evident, listening to the presentation, that the industry cannot, on its own, end tobacco smoking. Far from it. “Can we look forward to a day when BAT sells its last cigarette?” Wheaton asked, before answering, “Yes, I think that is indeed within long-range view. But it will require more than just the efforts of industry or governments.”
Even the development and marketing of less risky tobacco and nicotine products is not just down to the industry, I guess. There is no point in developing products whose viability will fall foul of unhelpful regulation in a significant number of countries. I caught the end of the GTNF panel discussion on innovation at which the moderator ended the session by bewailing the fact that the innovations that had been discussed were unlikely to be introduced in the U.S. because of regulatory hurdles in that country. And the U.S., remember, is one of the countries that is counted among those that are moving the THR needle.
Most of the suggestions that Wheaton put forward as being necessary to reinvigorate THR have been made before but have proved devilishly difficult to implement. For instance, Wheaton made the point that in order to allow consumers to make informed decisions about what types of tobacco/nicotine products to use, public health needed to communicate risk accurately, and the industry needed the marketing freedoms to be allowed to communicate responsibly the benefits of switching from higher risk products to lower risk products. This is true, but while there is some movement in some countries toward such positions, in many countries, official information about the risks associated with tobacco and nicotine products is generally confusing and, in some cases, misleading.
While it was a little disappointing, I thought, that Wheaton did not spend time discussing the relative environmental merits of the various tobacco and nicotine products on offer, which the engaged consumer would also seek, he did make the point that the industry needed to demonstrate that it can change sustainably. This is correct in my view. There is little point in prolonging the lives of individuals if we are going to help bring forward the death of humanity at large.
BAT has a good record when it comes to research into lower risk products, and Wheaton made the point that science was the key to unlocking the potential of industry transformation from selling higher risk tobacco products to selling lower risk nicotine products. But he will know as well as anybody that not all the “science” points in the same direction because not all research is conducted in a scientific manner. At least one other GTNF session was taken up with a presentation demonstrating that the findings of some research funded by the U.S. Food and Drug Administration were not supported by the evidence but were nevertheless likely to influence regulations.
Wheaton admits that he doesn’t have all the answers. But he has laid down the challenge. “It is no longer the time for talk but time to act because tobacco harm reduction is too important for us not to,” he said.
“Ladies and gentlemen, we are standing at a crossroads. It’s either more of the same, more ‘quit or die,’ more path of least resistance, or we can chart a new course with tobacco harm reduction as our goal.”–George Gay
The full text of Wheaton’s presentation is available here.

November 1, 2022
Choosing Wisely

Photo: manovankohr

Are choices key to successful switching?

By Cheryl K. Olson and Willie McKinney

Like many people who smoke, Doug Halterman wanted to quit. “I tried other ways, even prescription drugs, and nothing worked.” When he decided to try vaping, “At first, it was a research and development stage. I had to figure out what ones best acted like a cigarette,” he recalled. “I started with menthol tobacco. I then liked the fruit flavors because it helped stay clear of cigarettes. After vaping fruity flavors, cigs tasted absolutely disgusting.”
Halterman’s story of switching is one of several dozen generously shared via emails from members of the Consumer Advocates for Smoke-free Alternatives Association (CASAA). This exploration of what drives change was triggered by anecdotes and research suggesting that encountering and trialing a range of alternative nicotine products, or rotating among an engaging mix of options, can be key to ditching smoking. The typical successful quitting journey seems less like a thruway and more like a meandering river. The U.S. Food and Drug Administration’s Center for Tobacco Products’ approach to researching switching, described in its Final Rule guidance, assumes simple choices and straight lines.

The Wrong Framework?

Premarket tobacco product application (PMTA) behavior studies are supposed to describe likely changes (and related health risks) created by the marketing of a single novel tobacco product of a particular flavor and nicotine strength. This is not unlike studies the FDA’s Center for Drug Evaluation and Research (CDER) reviews, comparing effects of a new drug to a placebo on particular symptoms or endpoints.
In a September 2021 PMTA Technical Review Summary available online, the FDA laid out a new standard that flavored electronic nicotine-delivery system (ENDS) products must meet. Balancing concerns about youth uptake demands “acceptably strong evidence that the flavored products have an added benefit relative to that of tobacco-flavored ENDS in facilitating smokers completely switching away from or significantly reducing their smoking.” What kind of evidence? “Most likely product specific evidence from a randomized controlled trial (RCT) or longitudinal cohort study.”
Again, it’s like testing whether a medicine to treat gout or acne is superior to the current standard therapy, except it casts tobacco flavoring (the taste of cigarettes) as the standard and mango or vanilla as the unproven alternative.
Does an approach that may work for “safe and effective” prescribed drug authorizations make as much sense for a balance-of-risks consumer product standard? Does the CDER mindset serve well the end goal of moving people off combustibles? This pharma-influenced standard may be the wrong tool to address tobacco product effects.
Comments from people’s real-world switching experiences (see sidebar) suggest that a test-in-isolation model fails to capture a lot of key information that could accelerate the move away from smoking and its unacceptably high risks of disease and death.
Unlike pharmaceuticals and devices approved by other FDA centers, nicotine consumer products are not prescribed as a course of treatment. Tobacco users looking to switch aren’t making comparisons among two (or three) options. They meander through shops and gas stations, picking up nicotine products at will and whim. Many use multiple products to suit situations or prevent boredom. They learn through trial and error: How does this product work? What does it do for me? How does it fit into my life? And they choose again.
Another problem: As Neil McKeganey of the Center for Substance Use Research pointed out recently, it’s not clear by how much the FDA values youth vaping prevention over adult smoking cessation. How obviously better would a flavored product need to be at helping smokers switch, compared to a tobacco flavor, to offset concerns about youth appeal? The recent longitudinal study of Juul, where over half of participants switched completely from cigarettes at one year, found that what flavor smokers chose did not significantly affect success.

Missing Variables

Most studies aren’t designed to address the power of choices. Even large surveys that support the importance of flavors in switching tend to collapse flavors into categories (like “sweet” for fruit and candy) and ask about main flavor used, obscuring the paths taken by individual quitters. But there are tantalizing hints. For example, a six-week switching study of tobacco-free pouches found a link between trying more flavors and fewer daily cigarettes smoked. A 2018 study of MarkTen found that smokers who switched completely used more flavors.
Based on her experience researching oral and vapor product behaviors (including MarkTen), “Most smokers don’t successfully switch and sustain their switching through one product category,” said Jessica Zdinak, chief research officer at Applied Research and Analysis Consulting. She notes that academic studies of smoker transitions often leave out important variables, such as previous quitting experiences or stressful changes in life circumstances.

Adding Real-World Evidence

FDA Commissioner Robert Califf has been quoted repeatedly as supporting greater reliance on real-world evidence to support drug regulation decisions. During his first stint as FDA head, Califf said at the 2016 Food and Drug Law Institute conference that “In the past, so-called ‘regulatory trials’ tended to focus on high-quality studies with detailed study procedures, restrictive inclusion and exclusion criteria and have been conducted in special study sites.” By contrast, he noted that “pragmatic clinical trials,” studies that look at treatments and outcomes in actual medical practice settings, “may be the most important source of knowledge in the future.”
Another difference from pharmaceutical products: Many alternative nicotine products have been on the market for several years. Why not consider real-life evidence, as in natural choice situations over time, for tobacco product switching behavior? Don’t throw away tried-and-tested tools but see how they fit in a new context.
Zdinak would like to see long-term randomized trials that incorporate this approach, showing the effect of having or lacking a range of options. To demonstrate the effects of flavors on switching, “What does the world look like if I’m a smoker of 30 years who enters a vape shop, and I have tobacco-flavored vapes as my sole option? Or what happens if I see citrus, mango, cinnamon, coffee and caramel?” She is currently in the design and review phase for one such realistic study.
To quote prominent researchers Dorothy Hatsukami and Dana Carroll, “Most in the tobacco control community would agree that an immediate main goal is to rapidly eliminate tobacco-related death and disease.” If regulators agree, let’s look at what obstacles are preventing smokers from switching more rapidly. That includes tailoring methods and assumptions borrowed from pharma research to suit appropriate for the protection of public health (APPH) standards and goals.

The Power of Choices: Stories from CASAA
Founded in 2009, the Consumer Advocates for Smoke-free Alternatives Association (CASAA) is a 501(c)(4) consumer nonprofit organization that aims to “ensure the availability of a variety of effective, affordable reduced-harm alternatives to smoking.”
In response to an emailed request from CEO Alex Clark, a number of former smokers took time to share their experiences of switching to vaping or other smoke-free products. One question posed by Clark was whether the variety of products was helpful in staying engaged with smoke-free options and reducing the temptation to return to smoking.
Clark himself recently switched from vaping to using pouched snus. Along with a concern that overconsumption of stimulants, such as coffee and rapid-delivery nicotine products, were triggering heart palpitations, he said, “The hands-free nature of snus fits more with my needs. And I can still get all of the different flavors when I order from Sweden.”
Here are excerpts from CASAA member comments, edited for length and clarity. No doubt, people who smoke have a range of goals and preferences that evolve in sometimes surprising ways through product exploration.
Nancy S.: “I started vaping because I was unable to stop smoking tobacco cigarettes because I am so addicted to nicotine. And I don’t want to die from lung cancer like my father did. The products I tried were exactly what I was looking for. I wanted something that tasted like a real cigarette. No funny flavors.”
Roger M.: “I love the variety of products—both hardware and e-juices. My favs are black licorice, almond and bubble gum. They say only the kids like these flavors, but I have loved them since I started vaping 12 years ago. I am now 61.”
Sara C.: I liked trying new flavors in the beginning then found my favorite [strawberries and cream] that I’ve stuck with for years.”
Marc C.: I’ve tried the patch, the gum, hypnosis, as seen on TV products, medications and counseling. Nothing worked or works for me except vaping. I want my vape to taste like an authentic tobacco vape. But I’m okay with some flavor of tobacco, like coffee, vanilla, apple or maple. Almost like a pipe tobacco assortment.”
Sean O.: “The first product I tried wasn’t all that good. Eventually, I found that using what’s called a ‘box mod,’ which takes two high-powered batteries … gave the great sensation in your throat of inhaling the same way a cigarette did. The large clouds of vapor that you can produce using these mods and tanks is incredible. [And] the variety of flavors is exactly what has kept me away from cigarettes.”
Joni L.: “The device was key for me. I chose a Vaporesso Swag because of the size. It felt close enough to a pack of cigarettes for me, and a lot of my habit was actually reaching for my smokes. My first e-juice was a house-made vanilla custard tobacco; I was afraid to go too far away from tobacco flavors because I actually believe I liked the flavor of a cigarette. After three or four days, I went back to the vape shop and bought some mixed berry-flavored juice. That was it. It didn’t take long for my cigarette cravings to go away.”
Kelly P.: “I did try a different device but went back to Juul. I liked the mint and found it better than the menthol cigarettes I had smoked. Also, Juul wasn’t one of those devices that you would blow out a cloud of smoke.”
Glenn N.: “I believe that the first ‘e-cigarette’ I bought was the first Blu. I vaped that for a couple months, but it was missing something, and I thought I would go back to cigarettes. So I started looking online. With that ProVari, I knew that I would never smoke again. I found what I needed. I started with 36 mg liquid and went down to 12 mg in about a year.”
Steve T.: “I will be 68 this year and feel I made a great decision with vaping. Access to flavors is a critical component necessary to transition away from cigarettes. I have reduced the nicotine levels from 18 mg to 3 [mg], and my Kona e-juice was replaced with dessert and blueberry flavors.”
Jessie C.: “NRT [nicotine-replacement therapy] options like snus and nicotine gum/lozenges never worked for me as more than a way to avoid smoking at an event or during a long work shift. I’m very much a tech-oriented person, so the idea of having many options was stimulating for me. At the time, CE4 atomizer [tanks] and little pens were the most accessible items on the market [and did not meet expectations]. When the Kangertech Subox Mini hit the market, I was satisfied and stuck with that.”
Cindi K.: I started vaping in 2014 not because I was looking to quit smoking but because I was avoiding convenience stores; I had just entered AA [Alcoholics Anonymous] and that is where I’d bought alcohol. Two doors down was a vapor store. I bought an eGo Tank and some tobacco-flavored e-liquid in 24 mg. I made friends in AA that were also vaping and noticed their liquids smelled much better than what I was using. I continued to be what I labeled a dual user for a few more months and decided to use flavored e-liquid and willpower to quit smoking. I also learned how to make my own flavors. I had about 12 I used in rotation and loved.”
Tanya L.: “The first product I tried was in 2013: a vanilla-flavored vape liquid, Kanger T3S tank and coils, which I still use. I like vanilla. I just had to find the best vanilla.”

Cheryl K. Olson is a California-based public health researcher who specializes in behavioral health issues and consults on tobacco product behaviors via McKinney Regulatory Science Advisors. She spent 15 years on the faculty of Harvard Medical School.

Willie McKinney is the founder of McKinney Regulatory Science Advisors. He’s held senior regulatory roles at major tobacco product companies and served for three years as the industry representative on the FDA’s Tobacco Products Scientific Advisory Committee.

November 1, 2022
Court Stays Logic MDO

Photo: de Art

A U.S. appeals court has stayed the Food and Drug Administration’s marketing denial order (MDO) for Logic Technology Development’s Logic Power Menthol E-Liquid Package and Logic Pro Menthol E-Liquid Package, according to a NATO newsletter.
The ruling allows retailers and wholesalers to continue selling the products for the duration of the stay.
The U.S. Circuit Court of Appeals for the 3rd Circuit will now consider a further motion from Logic regarding the MDO that the company has seven days to file, according to media reports.
“The foregoing motion for a partial administrative stay is GRANTED as follows. The FDA’s marketing denial order is TEMPORARILY STAYED as to the Logic Pro Menthol E-Liquid Package and the Logic Power Menthol E-Liquid Package products. Within seven days of this order, the petitioner must file its motion for a stay pending the petition,” the order states. “The FDA’s response must be filed within 10 days thereafter.”
The temporary administrative stay will remain in effect until a panel of the court decides on Logic’s new stay motion. If no timely stay motion is filed, the clerk is authorized and directed to vacate the temporary administrative stay.
Tobacco harm reduction advocates have questioned the FDA’s reasoning behind the Logic MDO, suggesting that the agency misinterpreted youth consumption statistics.

November 1, 2022
Russia Continues to Collect Significant Tobacco Taxes

Photo: RODWORKS

Tax payments by the leading international cigarette manufacturers have provided the Russian government with at least $7.25 billion in additional income since President Vladimir Putin ordered his army to attack Ukraine, according to an analysis of Russian Treasury figures conducted by The Telegraph.
Center-Life, an anti-smoking lobbying group in Ukraine, told The Telegraph that 2020 taxes from PMI and JTI alone would fund 700 Mil Mi-24 helicopters, 1,970 T-72 tanks and 382 Sukhoi Su-25 fighter jets for the Russian army.
“It’s clearly completely wrong that these western firms continue to pay significant taxes into Russian coffers because so much of Russian state expenditure now is to fund the war in Ukraine, which is killing people in large numbers,” Bob Seely, a Member of Parliament on the Foreign Affairs Committee, was quoted as saying by The Telegraph.
Following the Feb. 24 invasion, international cigarette manufacturers announced they would end their operations in Russia, but retreating from such a major market is easier said than done. Tobacco companies have had to carefully navigate shifting regulations and avoid missteps that could prompt the government to seize the business, for example—all the while trying to protect employees from becoming targets for arrest.
Earlier this year, Philip Morris International CEO Jacek Olczak described the process as “bloody complex.” In a July interview, he said the company was unlikely to be able to leave Russia before the end of 2022.
Russia is the world’s fourth-largest cigarette market. Prior to the war, Japan Tobacco International led the market with a 36.7 percent share, followed by PMI (31.7 percent) and BAT (23.5 percent), according to Cowen & Co.

November 1, 2022
Medicago Cuts Jobs at Covid Vaccine Facility

Photo: Miljan Živković

Medicago is cutting 62 jobs at its manufacturing facility in Durham, North Carolina, USA, which played a key role in producing the company’s tobacco plant-based Covid-19 vaccine, reports the Triangle Business Journal.
In a notice to the North Carolina Department of Commerce, the Canadian biopharmaceutical company said the layoffs are the result of Medicago “restructuring its workforce to align with its changing business needs.”
Using tobacco plants, the company developed a Covid vaccine called Covifenz, which Canadian regulators approved earlier this year. The country’s government committed to purchasing 20 million doses of the vaccine with an option to purchase 56 million more.
No other country has approved Covifenz, however. The World Health Organization, meanwhile, has been reluctant to grant the vaccine emergency approval due to Medicago’s ties with Philip Morris International, which owns about a third of the biopharmaceutical company.
Headquartered in Quebec City, Medicago employs 600 people.
The company built out its facility in Durham through a 2010 partnership with the U.S. Defense Advanced Research Projects Agency, which included $21 million in funding from the federal agency. The facility features greenhouse space and an automated extraction and purification system.

November 1, 2022