Category: News This Week

Study: Filter Ban Only Way to Halt Pollution

Photo: Yakiv
Banning cigarette filters is the only way to stop tobacco product pollution, according to a new study published by the Dutch sustainability think tank CE Delft and reported by Dutch News.
Every year, Dutch smokers discard an estimated 200 million to 7.1 billion cigarette butts into the environment.
The current policy of limiting toxic waste by discouraging smoking is not working, according to CE Delft. The organization is also skeptical about the potential of butt deposit schemes. Consumer research has shown that just over one quarter of smokers said they would be willing to hold on to their butts until they had an opportunity to discard them at a collection point.
Dutch Junior Environment Minister Vivianne Heijnen wants to reduce the number of discarded filters, which contain plastics and chemicals, by 70 percent in 2026. The current measures, which include general awareness campaigns and a smoking ban on beaches, have resulted in only a 15 percent decrease, CE Delft found.
In 2022 alone, volunteers collected almost 90,000 cigarette butts during a two-week cleanup of the Dutch beaches, amid 4,400 kilos of waste left by beachgoers.
A ban on cigarette filters will become feasible in 2026 when the European Union will review its rules on single-use plastics, the report noted.
February 27, 2023
Mativ Holdings Reports Results

Photo: SWM
Mativ Holdings reported sales of $660.1 million in the fourth quarter of 2022, up 69 percent over those reported in the comparable 2021 quarter, reflecting 6 percent constant currency organic sales growth and the benefit of the merger between Neenah and Schweitzer-Mauduit International that created the holding. GAAP Income was $2.5 million and GAAP operating profit was $26.9 million, which all included significant expenses related to the Neenah merger integration.
For the full year 2022, sales increased 51 percent to $2.17 billion, reflecting 11 percent constant currency organic sales growth and the benefit of the merger. GAAP loss was $6.6 million and GAAP operating profit was $51.4 million, which all included significant expenses related to the Neenah merger closing and integration.
“2022 was a historic year for Mativ, bringing together two strong companies to leverage our combined technologies and products to drive value for all of our stakeholders,” said Mativ Holdings CEO Julie Schertell in a statement. “We closed out the year with strong year-over-year fourth-quarter growth for the combined company from continued positive price/cost performance, and we enter 2023 with clear momentum on integration and synergy execution.
“Despite macro uncertainties, our conviction in the opportunities ahead for Mativ is unwavering. We have significant controllable actions to enable strong performance as we enter 2023, specifically cost synergies, innovation and programs focused on commercial and operational excellence, as well as broader, longer term decisions and actions to capitalize on our increased scale.”
February 27, 2023
FDA Appeals Rejection of Graphic Warnings

Image: FDA
The U.S. Food and Drug Administration has appealed a court ruling that found the agency’s graphic health warning rule unconstitutional, reports CSP.
On Dec. 7, a federal judge in Texas blocked the FDA from enforcing a rule requiring tobacco companies to print graphic health warnings on their products, saying they violated free speech protections under the First Amendment.
The graphic cigarette health warning rule required manufacturers and retailers who sell cigarettes to rotate 11 health warnings on cigarette packs, which consisted of textual statements and color graphics depicting the negative health consequences of cigarette smoking.
The Texas court said the graphic cigarette health warnings would have compelled manufacturers and retailers to speak by displaying cigarette packages on store shelves and advertising cigarettes when, if given the choice, manufacturers and retailers would choose not to do so. The court also said the warnings were not purely factual and were open to interpretation by consumers and more extensive than necessary.
The FDA appealed that decision on Feb. 1 in the U.S. Court of Appeals for the Fifth Circuit, according to court documents.
The Family Smoking Prevention and Tobacco Control Act of 2009 instructs the FDA to create visual health warnings, but the D.C. Circuit in 2012 blocked the agency’s first attempt, saying that regulators had not convincingly demonstrated that the warnings would actually reduce smoking.
In March 2020, the FDA released the final rule requiring new graphic warnings for cigarettes that feature some of the lesser known but still serious health risks of smoking, such as diabetes, on the top half of the front and back of cigarette packages and at least 20 percent of the area on the top of cigarette advertisements.
Several tobacco companies, including R.J. Reynolds Tobacco Co., filed a First Amendment challenge in April 2020. The rule was set to take effect in November 2023 after the deadline was repeatedly pushed back by court.
According to health groups, the U.S. has fallen behind other countries with its tobacco control policies. Prior to 2009, when Congress passed the Tobacco Control Act, only 18 countries required graphic warnings for tobacco products, they pointed out. Today, more than 120 countries require them.
February 24, 2023
Malaysia PM Urges Regulation E-liquids

Photo: Max
The government of Malaysia wants to regulate and tax nicotine liquids, reports New Straits Times, citing Prime Minister Anwar Ibrahim.
Speaking during the presentation of the government’s 2023 buget, Anwar said that although vape with nicotine is illegal, the product is still being sold widely with an estimated market size of more than MYR2 billion. “Would it not be great if it is monitored and taxed to discourage the usage of vape,” asked Anwar, who is also the finance minister.
While welcoming the proposal to introduce a regulatory and taxation framework for e-cigarettes, industry groups insisted on consultations. “Regulations and tax rates need to be balanced given it will impact local industry players,” said The Malaysian Vape Chamber of Commerce.
In his presentation, Anwar also expressed support for the Generational Endgame (GEG) bill, which would make it illegal for people born after 2007 to buy tobacco products, including e-cigarettes.
The Advanced Centre for Addiction Treatment Advocacy (ACATA) said the government must conduct more studies on the GEG proposal before making any decision.
While ACATA is encouraged by the government is taking steps to regulate vape, the agency said prohibition was likely to backfire. “There is substantial and credible evidence to prove that vape products are less harmful than smoking cigarettes,” the organization stated. It also cited evidence showing that vaping is effective in helping smokers to quit smoking cigarettes without attracting many never-smokers. ACATA cited a 2020 study, which found that only 0.6 percent of Malaysian nonsmokers vape.
The Malaysian Vapers Alliance, meanwhile, expressed disappointment that the government supported the GEG proposal, saying that cigarettes and vapor products should be treated differently, given the vast difference in risk they present.
February 24, 2023
CTP Outlines Responses to Reagan-Udall Report

Photo: Tada Images
The U.S. Food and Drug Administration’s Center for Tobacco Products (CTP) on Feb. 24 outlined the steps it plans to take in response to an external evaluation of its operations conducted by evaluators working through the Reagan-Udall Foundation.
The expert panel issued its final report on Dec. 19, 2022, and included 15 recommendations across a number of areas.
To address concerns raised in the report about transparency, the CTP said it would appoint internal transparency liaisons within each CTP Office, who will be responsible for objectively identifying areas for transparency enhancement. The center will also create a new webpage to feature its responses to citizen petitions and will resume posting scientific policy memos and reviewer guides “when appropriate.”
To enhance efficiency of its premarket tobacco product application review process, the CTP said it has started developing a more efficient framework for high-quality reviews. The center said it aims to better communicate on scientific issues and practices; hire additional staff and increase internal communication to improve scientific engagement and deliberation. Among other activities, the CTP said it will resume posting of scientific policy memos and reviewer guides, along with communication through public events, such as workshops and listening sessions.
The CTP also expressed its intention to hold more frequent meeting of the Tobacco Products Scientific Advisory Committee to obtain input on scientific issues.
To improve its operations in the areas of regulations and guidance, the CTP said it will create a new policy unit within the Office of the Center Director that would be responsible for providing overall policy coordination across the CTP.

The FDA has advocated for the authority to collect user fees from e-cigarette companies, which currently do not pay user fees despite the enormous workload to review and make decisions regarding these products.
Robert Califf, Commissioner, FDA
Recognizing opportunities to enhance its compliance and enforcement work, the CTP said it will convene a summit related to enforcement with senior officials from the Department of Health and Human Services, the FDA, and the Department of Justice (DOJ). The CTP will consider whether statutory changes are needed to assist the center in enforcing the law. It will also explore approaches to achieve compliance outside of judicial enforcement actions through DOJ.
The CTP said it plans to create a comprehensive webpage for all enforcement activities for products that are illegally marketed without FDA authorization; routinely reach out to industry stakeholders to keep them apprised of new enforcement priorities and updates; and enhance the FDA’s tobacco product marketing order webpage. Planning has already begun for development of a searchable public database of all tobacco products that have an FDA marketing order, according to the center.
To improve engagement on its public education campaigns, the CTP said it will develop, publish and promote resources that describe the mechanisms it currently uses to solicit and consider public input on its campaigns. It will also explore new ways for soliciting and considering public input on its campaign program.
Consistent with the Reagan-Udall report recommendation, the CTP is also engaging with relevant entities within FDA, the Department of Health and Human Services, and the Office of Personnel Management to identify solutions to facilitate more timely and efficient hiring of professionals that match CTP’s needs.
To achieve its goals, the CPT stressed the importance of having appropriate resources, which it suggested could be raised through additional user fees for regulated products, including e-cigarettes. “Since the agency’s fiscal year 2020 budget request, the FDA has advocated for the authority to collect user fees from e-cigarette companies, which currently do not pay user fees despite the enormous workload to review and make decisions regarding these products,” said FDA Commissioner Robert Califf in a statement.
A detailed description of the CTP’s plan for addressing the Reagan-Udall recommendations is available at the center’s new website.
February 24, 2023
U.S. Court Orders Halt to Elfbar Sales

Photo: md3d
A U.S. federal judge on Feb. 23 ordered Shenzhen Weiboli Technology to stop marketing its Elfbar e-cigarettes in the U.S., finding that VPR Brands, which makes and sells Elf brand vapes, is likely to succeed on its claims that the Elfbar vapes infringe its trademark, reports Law360.
According to U.S. District Judge Aileen M. Cannon, VPR has shown there is a likelihood of confusion and the company stands to suffer harm if its Chinese competitor is allowed to keep selling the Elfbar vapes.
In November, VPR asked for an injunction blocking Shenzhen Weiboli from continuing to use the Elfbar mark, arguing the alleged infringement is costing VPR about $100 million because of the effect on future sales.
VPR claims Shenzhen Weiboli is not only infringing VPR’s Elf trademark but also its patent for its e-cigarette device.
While there is no direct evidence that Shenzhen Weiboli deliberately intended to adopt the Elf mark to take advantage of the existing trademark, Judge Cannon wrote that the company was well aware of the Elf mark and that there was potential for confusion, as the U.S. Patent and Trademark Office denied the registration of an Elfbar trademark specifically for those reasons.
VPR welcomed the judge’s decision. “VPR is pleased that the court found Elf is a strong trademark and granted the injunction,” said Joel B. Rothman of Sriplaw, which represented VPR in the case. “The injunction will allow VPR to move quickly against infringers and counterfeiters in the marketplace.”
An attorney for Shenzhen Weiboli said the company intends to appeal the order.
February 24, 2023
Hong Kong Hikes Cigarette Prices

Photo: B Photography
The average price of a pack of cigarettes in Hong Kong increased to HKD73.75 ($9.40) on Feb. 22, following a 31 percent tax hike, reports the South China Morning Post.
With the increase, the city government aims to boost its coffers and cut the number of smokers by 100,000 in the next three years.
“Increasing tobacco duty is recognized internationally as the most effective means to reduce tobacco use,” Financial Secretary Paul Chan Mo-po said in his budget speech. “A rise in cigarette price will increase the incentive of smokers to reduce or quit smoking.”
The government estimates the price increase would bring in an extra HKD1 billion a year in revenue.
The prevalence of smoking in Hong Kong has dropped from 23.3 percent of the population in 1982 to 9.5 percent at present. With the new measure, authorities hope to bring the figure down to 7.8 percent by 2025, or reduce the number of smokers from about 580,000 to 480,000.
Tobacco taxes now account for 68 percent of the pack price. This is higher than the 62 percent prior to the tax hike but still lower than the 75 percent rate recommended by the World Health Organization.
By comparison, tax makes up 67.1 percent of the price of a pack of cigarettes in Singapore, 73.9 percent in Australia and 82 percent in New Zealand, according to figures from 2020.
A government representative said that an increase in tobacco tax had led to more inquiries to the Department of Health’s smoking cessation hotline in the past. After the tobacco tax was raised by 50 percent in 2009, calls to the hotline rose by 257 percent.
February 23, 2023
Scandinavian to Acquire Alec Bradley Cigars

Scandinavian Tobacco Group has agreed on the terms and conditions for the acquisition of substantially all assets of Alec Bradley Cigar Distributors Inc. and associated companies, according to a company press release.
The transaction is valued at $72.5 million (DKK500 million) on a debt and cash-free basis (the enterprise value) and is expected to be closed shortly. The acquisition will be fully financed by cash at hand and debt.
The Alec Bradley brand is a material addition to the company’s portfolio of premium cigars.
Based in Fort Lauderdale, Florida, Alec Bradley reported annual net sales in 2021 of $25 million and an EBITDA margin before special items of 24 percent. Both net sales and EBITDA margin improved during 2022.
CEO of Scandinavian Tobacco Group Niels Frederiksen said, “The acquisition of the Alec Bradley cigar business is another important step toward our ambition of becoming the undisputed and sustainable global leader in cigars.
Through this bolt-on acquisition, we will expand our portfolio of highly regarded premium cigars in the U.S. and international markets, delivering material value to our shareholders. We will also leverage the Alec Bradley brand portfolio to deliver increased excitement to the handmade cigar category through product innovation and brand activations, benefitting both the cigar enthusiasts and our trade partners.”
The transaction is expected to be margin accretive, EPS accretive and ROIC accretive when fully integrated. The company leverage ratio (net interest-bearing debt/EBITDA) will, when the transaction proceeds to completion, increase by less than 0.2x.
At the end of the third quarter of 2022, the company’s leverage ratio was 1.9x. Further details of the expected financial impact of the acquisition will be communicated in connection with the announcement of Scandinavian Tobacco Group’s full-year 2022 results on March 8, 2023.
February 23, 2023
Vaporesso Launches Luxe XR Max

Vaporesso, one of the largest open-system vaping hardware manufacturers in the world, launched its new 80W Pod Mod, the Luxe XR Max during this year’s Total Product Expo (TPE) 2023 in Las Vegas, held from February 22 to 24 at the Las Vegas Convention Center.
The China-based subsidiary of Smoore International, the largest vaping company in the world, said that the XR Max is the latest member of Luxe X family and is fully compatible with other Luxe X products.
The Luxe products combine the core features SSS leak-resistant technology, and COREX, an innovative heating and flavor-boosting technique developed by Vaporesso, and is powered by the company’s signature Axon Chip,
The Luxe XR MAX offers an easier-than-ever user interface to help vapers get the best possible performance out of their vaping devices. The chip also equips Vaporesso’s products with a smart use mode.
As part of the new design, the Luxe XR MAX adopts the classic clear, futuristic shape of the Luxe X series, and offers users a heightened vaping. Its SSS leak-resistant design, coupled with the brand’s COREX heating technology effectively increases the flavor and the lifespan of GTX coil.
The new model also has a longer battery life, making it an ideal fit for direct-to-lung (DTL) users, according to Vaporesso.

February 23, 2023
PMI Struggles to Sell its Russian Business

Photo: alex83ch
Philip Morris International’s attempts to sell its Russian business have stalled due to the challenge of leaving the country on favorable terms, according to an article in the Financial Times.
Discussions with at least three “serious” potential buyers have gone nowhere in part because of the strict government requirements, according to PMI CEO Jacek Olczak.
Kremlin rules make it difficult for companies to exit Russia without taking a huge financial hit. Among other provisions, the government reserves the right to dictate the valuation of foreign companies’ Russian assets as well as the new owners’ dividend and access to cash flow.
Olczak told the Financial Times he had a duty to shareholders to recover value, adding he would “rather keep” the business in Russia than sell on stringent Kremlin terms. While the asking price was not disclosed, PMI has $2.5 billion worth of assets in the country, according to company filings.
Many western companies vowed to exit Russia immediately after last year’s invasion of Ukraine, but less than 9 percent of EU and G7 groups in the country had left by the end of December, according to research by the International Institute for Management Development.
Russia has historically been a huge market for the tobacco industry because of high smoking rates and consumer willingness to switch to vapes and heated-tobacco products. Together with Ukraine, it accounted for 8 percent of PMI’s $31.7 billion revenues last year.
Imperial Brands sold its Russian operations to a local partner soon after the invasion, taking a $463 million hit to annual profits.
Japan Tobacco does not plan to leave and BAT has struggled to get a sale over the line, although it said this month it was in “advanced talks.”
February 23, 2023