Category: News This Week

  • Malaysia Removes NRT from Poisons List

    Malaysia Removes NRT from Poisons List

    Photo: dalaprod

    Malaysia’s Health Ministry has categorized nicotine-replacement products as nonpoisons to make them more accessible to consumers, reports The New Straits Times.

    Minister Khairy Jamaluddin said the move was done by granting an exemption to nicotine under the Poisons Act 1952 for products in the form of patches or gum registered under the Control of Drugs and Cosmetics Regulations 1984.

    “This exception is expected to help smokers, who are motivated to quit smoking, in dealing with the withdrawal symptoms,” said Khairy.

    At present, smokers who want to quit smoking have limited access to nicotine-replacement products as they are regulated under the Poisons Act 1952.

    Under the law, nicotine is classified as a “Group C poison” and can be dispensed only by licensed pharmacists or registered medical practitioners.

    The New Straits Times article made no mention of nicotine vapor products, which tobacco harm reduction advocates consider to be the most effect nicotine-replacement products on the market.

    Malaysian lawmakers are currently considering the Control of Tobacco Product and Smoking Bill 2022, which, among other measures, would ban the sale of tobacco products, including e-cigarettes, to anyone born after 2007.

  • FDA Issues Warning to Puff Bar, MDOs to Hyde

    FDA Issues Warning to Puff Bar, MDOs to Hyde

    Credit: Puff Bar

    New data from the 2022 National Youth Tobacco Survey (NYTS) shows that 2.5 million U.S. youth use e-cigarettes, according to the published findings in the Morbidity & Mortality Weekly Report released by the U.S. Food and Drug Administration in conjunction with the Centers for Disease Control and Prevention.

    “The FDA remains deeply concerned about e-cigarette use among our nation’s youth. It’s clear that we still have a serious public health problem that threatens the years of progress we have made combatting youth tobacco product use,” said FDA Commissioner Robert M. Califf. “We cannot and will not let our guard down on this issue. The FDA remains steadfast in its commitment to using the full range of our authorities to address youth e-cigarette use head-on.”

    The study shows that about one in 10 middle school (3.3 percent) and high school (14.1 percent) students reported current e-cigarette use; current use is defined as use within the past 30 days. About 85 percent of surveyed students reported using flavored e-cigarettes while 27.6 percent reported daily use. Respondents most commonly used disposables, with Puff Bar being most common (14.5 percent) followed by Vuse (12.5 percent) and Hyde (5.5 percent). Puff Bar and Vuse were pre-specified options on the survey, but Hyde was written in by students as their preferred brand.

    Since methodology changes occurred, including in survey administration and data collection procedures due to the Covid-19 pandemic, comparisons between the 2022 NYTS and previous years is limited.

    Following the release of this data, the FDA has issued a warning letter to Puff Bar for receiving and delivering e-cigarettes in the U.S. without a marketing authorization order. The FDA has requested a response within 15 working days of receiving the letter, detailing how the company intends to address the FDA’s concerns, including the dates on which they discontinued the sale and/or distribution of these tobacco products and plans for maintaining compliance with the Federal Food, Drug and Cosmetic Act. Failure to address the violations puts the manufacturer at risk of regulatory action, such as a civil money penalty, product seizure and/or injunction.

    The Puff products subject to this warning letter are nontobacco nicotine products.

    After reviewing premarket tobacco product applications for 32 Hyde e-cigarettes, the FDA issued marketing denial orders (MDOs) for these applications submitted by Magellan Technology Inc. In conducting its scientific review, the FDA determined that the applications lacked sufficient evidence demonstrating that the products would provide a benefit to adult users that would be adequate to outweigh the risks to youth. No Hyde products have received marketing authorization orders from the FDA.

    “Congress gave the FDA authority to hold manufacturers and retailers who violate the law accountable,” said Brian King, director of the FDA’s Center for Tobacco Products. “FDA is actively working to identify violations and to swiftly seek corrective actions, particularly for products popular among youth. We will use all compliance and enforcement tools available to us, as appropriate, to protect our nation’s youth.”

  • JTI Investing in Philippines

    JTI Investing in Philippines

    Photo: Skórzewiak

    Japan Tobacco International is expanding its operations in the Philippines, hiring additional workers for its global business service center (GBSC).

    The GBSC was established in 2020, at the height of the Covid-19 pandemic, to service JTI’s affiliates in Asia-Pacific and the Americas. In an interview with the Manila Bulletin Business, JTI Philippines General Manager John Freda said the company would be hiring an additional 150 people, bringing the center’s overall manpower to 600.

    Although there are no immediate plans, Freda did not discount the possibility of JTI producing its Ploom heated-tobacco sticks in the Philippines, which serves as the company’s manufacturing hub for the Asia-Pacific region. Ploom is currently produced in Japan and in the EU.

    JTI’s cigarette factory in Malvar, Batangas, exports more than 50 percent of its production mainly to 16 countries in the Asia-Pacific region. The factory employs 800 people with marketing team support of over 4,000 personnel across the country.

    In the interview, Freda also expressed his concern about the growing illicit cigarette trade in the Philippines, which is estimated to account for 16 percent to 18 percent of the market. In some areas in Mindanao, the share of smuggled cigarettes could reach 60 percent of the market.

    Citing the experience of Malaysia as a cautionary example, Freda urged the Philippines to step up enforcement and adopt reasonable rates of taxation.

    “We are paying PHP55 [$0.94] per pack in taxes, and clearly the illicit operator is not paying like that, and as prices increase due to taxation, it becomes even more profitable for smugglers and therefore need[s] strong enforcement measures,” he said.

  • Imperial Announces Share Buyback

    Imperial Announces Share Buyback

    Stefan Bomhard (Photo: Imperial Brands)

    Imperial Brands has announced the start of a multi-year share buyback program.

    The company intends to repurchase up to £1 billion ($1.12 billion) of shares between Oct. 7, 2022, and the end of September 2023. This would represent approximately 5.5 percent of the issued share capital of Imperial Brands based on the Oct. 5, 2022, market close.

    “The launch of our new buyback program is an important milestone in our five-year strategy announced in January 2021,” said Imperial Brands CEO Stefan Bomhard in a trading update. “Over the past two years, increased investment and a more consumer-centric approach have improved delivery in both our priority combustible markets and next-generation product operations. Disciplined capital allocation has strengthened our balance sheet to reach our target leverage levels.

    “Today’s announcement is underpinned by this improving performance and our confidence in being able to continue generating strong cash flows to support growing shareholder returns in the years to come,” Bomhard added. “We are committed to a progressive dividend and an ongoing buyback program to meaningfully reduce the capital base over time.”

    According to Imperial Brands, trading in the year has been in line with expectations. Targeted investment in the company’s five largest combustible markets (which account for around 70 percent of operating profit) has driven an improvement in aggregate market share.

    A stronger price mix accelerated the growth rate of tobacco net revenue at constant currency exchange rates in the second half of fiscal 2022. The recovery of international travel has led to a return to pre-Covid purchasing patterns, with increased volume declines, particularly in Northern Europe, partly offset by volume growth in Southern Europe and duty-free.

    Imperial Brands reported good progress in implementing its refreshed next-generation product strategy. The company’s Pulze and iD tobacco-heating products debuted in Italy, Europe’s largest heated-tobacco market, while gaining market share in Greece and the Czech Republic. The company says its new Blu 2.0 pod-based vapor device was well received during a consumer trial in France.

    Imperial Brands will report its annual results for the year ended Sept. 30, 2022, on Nov. 15, 2022.

  • Speculation Mounting About Juul Bankruptcy

    Speculation Mounting About Juul Bankruptcy

    Photo: andranik123

    Juul Labs may be preparing to file for Chapter 11 bankruptcy, according to reports by Bloomberg and The Wall Street Journal and a tweet by Reorg reporter Harvard Zhang.

    The vaping company has reportedly received inquiries from lenders and will soon formally request debtor-in-possession financing options.

    “We will continue the preparation process for both a restructuring and other strategic options as we determine what path is best for our company,” a Juul spokesman said on Oct. 4.

    Chapter 11 allows a company to continue operating while it works with a court and its creditors to reorganize its finances. It doesn’t necessarily herald the end of the company.

    A pioneer in the vaping business, Juul Labs has gone from dominating the U.S. e-cigarette market to fighting for its survival in a relatively short time.

    Following its initial success, the company quickly came under regulatory scrutiny over its marketing practices. Critics blame Juul Labs for contributing to an “epidemic” of underage vaping.

    Thousands of lawsuits have been filed against Juul over the past several years, alleging that the company marketed its e-cigarettes to children. Juul has said it never marketed to underage users.

    In June, the U.S. Food and Drug Administration ordered Juul’s products off the market, then stayed the decision pending Juul’s appeal.

    Last month, Juul agreed to pay at least $438.5 million in a settlement with more than 30 states.

    The uncertainty over Juul’s ability to remain on the market could make it difficult for the vaping company to raise money or secure traditional loans to pay for legal settlements or court judgments.

    In September, Juul’s largest shareholder, Altria Group, terminated its noncompete agreement with Juul. Altria’s decision gives Juul more options to secure its business, including the freedom to sell itself—or a significant stake—to one of Altria’s competitors.

    The rumors about a possible Juul bankruptcy are not new. Clive Bates, director of The Counterfactual, described them as a “nothing burger with a side of thin air.”

    “It has been obvious since @FDA maliciously denied Juul’s marketing application that Chapter 11 is a possibility,” Bates wrote in a tweet. “The ‘scoop’ is that this has not changed.”

  • Stricter Rules Ahead

    Stricter Rules Ahead

    Photo: michaeljung

    The South African Parliament accepted submission of the Tobacco Products and Electronic Delivery Systems Control Bill, which will replace the Tobacco Products Control Act of 1993, reports Business Insider.

    The bill, which was tabled in 2018, aims “to deter people, especially children and youth, from using tobacco products, encourage existing users to quit and protect nonsmokers from tobacco smoke exposure.” Regulation will cover sale, advertising, packaging and labeling of tobacco products as well as where smoking and vaping are allowed.

    Under the bill, smoking and vaping in enclosed public spaces will be prohibited. Smoking too close to “an operable window or ventilation inlet of an entrance or exit” of “an enclosed public place, enclosed workplace or in or on a public conveyance” is also prohibited.

    The health minister can also prohibit smoking in certain outdoor areas to “reduce or prevent the public’s exposure to smoking.” Smoking in vehicles or enclosed private spaces while in the presence of a child or nonsmoker will be prohibited. Smoking in an enclosed common area of a multi-unit residence will be banned as well.

    The bill will also mandate generic packaging for tobacco products; the packaging “must have a uniform plain color and texture” and be of the same “size, type and shape.” The health minister will be responsible for setting standardized packaging and labeling requirements.

    The only branding allowed on packaging will be brand name and product name in a standard color and typeface. Packages will be dominated by graphic health warnings.

    Additionally, stores will only be allowed to display “a single prescribed notice informing consumers that a list of relevant or related products for sale, along with their prices and quantities, may be requested at the sales counter.” Retailers and wholesalers will no longer be allowed to display tobacco products. They “may make the product available to consumers upon request, provided that the requestor is not a child.”

    This bill could also affect flavored vapor products. The health minister can prohibit “any substance or ingredient that creates a specified color, characterized flavor, smell or effect on the consumer.”

    “The industry wants to be regulated,” said Asanda Gcoyi, CEO of the Vapour Products Association of South Africa. “We have to be regulated.”

    “But we propose that government use [vapes and e-cigarettes] as a tobacco harm reduction product, [and] this bill does not actually go that far.”

  • China: Flavored E-cigarettes Still Available After Ban

    China: Flavored E-cigarettes Still Available After Ban

    Photo: Timothy Donahue

    Many businesses in China continued selling fruit-flavored e-cigarettes after a ban on such products took effect Oct. 1.

    A journalist working for Beijing Youth Daily reportedly found several stores violating the new rules while a small number appeared to have closed.

    In stores that are still in operation, the reporter saw only an estimated six vaping products on display, with only two or three varieties of products. Some stores experienced increased sales of combustible tobacco products.

    In November 2021, Chinese law was amended to bring the vapor industry under control of the State Tobacco Monopoly Administration, which regulates China’s tobacco products.

    Products meant for export will not have to meet Chinese standards unless the destination country does not have its own specific standards.

  • New Date for UKVIA Forum and Dinner

    New Date for UKVIA Forum and Dinner

    The UKVIA Vaping Industry Forum and Celebration Dinner will now take place on Friday, Nov. 18 at the QEII Centre in Westminster, London. The event had been canceled on Sept. 9, the day after the queen’s passing.

    The agenda remains the same, and the UKVIA expects some additional speakers to be part of the lineup.

    “We have had a fantastic response since the event was canceled, and we are looking to accommodate some additional speakers in our program,” said UKVIA Director General John Dunne in a statement. “We would like to thank delegates, sponsors, exhibitors and dinner guests for their patience, and we look forward to seeing everyone in November at what will be the biggest B2B event in the U.K. vaping calendar.

    “The occasion will be particularly poignant as the original planned forum and dinner came the day after the announcement of the queen’s death. The event will allow us to pay tribute to Britain’s longest reigning monarch.”

    While the original event had been at near full capacity, more tickets for the conference and dinner have now been released.

  • PMI Extends Swedish Match Bid Deadline

    PMI Extends Swedish Match Bid Deadline

    Photo: xtock

    Philip Morris Holland Holdings (PMHH) has extended the acceptance deadline of its $16 billion offer for Swedish Match to Nov. 4, 2022, as it awaits merger control approval from the European Commission.

    In May, PMI offered to buy the Stockholm-based company to help accelerate its move to cigarette alternatives. Swedish Match is best known for its oral tobacco products, including snus and the Zyn tobacco-free nicotine pouches that have taken the U.S. market by storm.

    The completion of the offer is conditional upon regulatory approvals. PMHH says it has already received the green light in the United States and Brazil but is still awaiting approval from the European Commission, which started its formal review on Sept. 6, 2022. PMHH decided to extend the deadline because it does not expect the Commission to complete its review until late October.

    This is the second deadline extension. In early September, PMHH extended its initial Sept. 30 deadline to Oct. 11, based on its assessment of the European Commission’s progress with the review at the time.

    According to PMHH, the other terms and conditions of its offer remain unchanged. “We believe our offer remains very compelling—particularly given the current market environment,” said Jacek Olczak, chief executive officer of Philip Morris International, in a statement. “We look forward to completing the transaction while also continuing to actively progress on our strategic alternatives to Swedish Match, should the offer ultimately prove unsuccessful.”

  • Qnovia Raises $17 million for Nebulizer

    Qnovia Raises $17 million for Nebulizer

    Photo: Qnovia

    Qnovia has raised $17 million to continue development of its RespiRx nicotine-replacement product, reports Richmond Business Sense.

    RespiRx is a portable, hand-held nebulizer, a powered medical device that delivers medicine as an inhaled mist and is similar to an inhaler. The device is designed to deliver a nicotine hit more quickly than existing therapies, thus enabling users to better manage withdrawals and, therefore, increase the likelihood of smoking cessation.

    Qnovia was founded in 2018 in Los Angeles by Mario Danek as Respira Technologies and rebranded in September. In May, the company appointed former Altria executive Brian Quigley as CEO and Danek as chief technology officer.

    The company also moved to Richmond, Virginia, in part because that state offers a more business-friendly environment, according to Quigley, whose tobacco career included a six-year stint as CEO of Altria’s U.S. Smokeless Tobacco Co. subsidiary.

    In addition, many of the partners the company works with are on the East Coast. Qnovia contracts with a Boston manufacturer to make its device and a firm in Pennsylvania to create the medicine administered through the device.

    Qnovia will use the newly raised funds to develop a proof of concept for RespiRx as a nicotine-replacement therapy product and move it through an FDA approval process before the anticipated start of human clinical trials in 2023.

    The product is expected to hit the market as a prescription treatment. Qnovia is also interested in exploring how RespiRx can be used for asthma, pain management, vaccines and other uses.