Category: Featured

Altria to Acquire NJOY Holdings

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Altria Group has entered into an agreement to acquire NJOY Holdings for approximately $2.75 billion in cash. The transaction terms include additional $500 million in cash payments that are contingent upon regulatory outcomes with respect to certain NJOY products.
“We believe we can responsibly accelerate U.S. adult smoker and competitive adult vaper adoption of NJOY Ace in ways that NJOY could not as a standalone company,” said Altria CEO Billy Gifford in a statement. “We believe the strengths of our commercial resources can benefit adult tobacco consumers and expand competition. We are also excited to welcome NJOY’s talented employees to Altria at closing.”
“As a result of this transaction, Altria’s enhanced smoke-free portfolio will include full global ownership of products and technologies across the three largest smoke-free categories and a joint venture with JT Group for the U.S. commercialization of heated tobacco stick products.”
“We are excited to add NJOY’s e-vapor intellectual property as a new platform that we believe we can build on to help more adult smokers transition to smoke-free alternatives,” said Olivier Houpert, Altria’s new chief innovation and product officer.
Altria will hold a conference call at 9 a.m. Eastern Time on March 6, 2023. Access to the live webcast is available at. A replay of the webcast and a transcript will be available on the same website following the event.
In 2022, the U.S. vapor category comprised nearly 14 million U.S. adult tobacco consumers, including 9.5 million exclusive adult vapers, according to Altria. The segment generated approximately $7 billion in U.S. retail sales and represented approximately 15 percent of total estimated equivalized U.S. tobacco volumes and more than 50 percent of total estimated equivalized smoke-free tobacco volumes.
To date, the U.S. Food and Drug Administration has approved the marketing of 23 vapor products and devices. In 2022, NJOY received marketing granted orders for the NJOY Ace device, along with several tobacco-flavored pods. The regulatory agency is still reviewing NJOY’s premarket tobacco product applications for several NJOY menthol-flavored e-vapor products.
Altria said it had multiple sources of funding for the deal, including cash from a $2.7 billion agreement with Philip Morris International last year for the IQOS Tobacco Heating System.
The NJOY deal follows an announcement by Altria that it would exchange its entire minority investment in embattled Juul Labs for a nonexclusive global license for certain of Juul’s heated tobacco intellectual property.
March 6, 2023
22nd Century Group Secures Financing

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22nd Century Group announced a new $21 million senior secured debenture financing to support increased working capital needs related to the significant growth outlook in both its VLN and GVB business lines. The new three-year financing was issued at a 5 percent original issuance discount, will bear cash interest at a rate of 7 percent per year and commence principal amortization in the second year at a rate of 2 percent of the original balance per month. The company has the option to redeem the facility early starting in the second year.
“We anticipate significant revenue growth in both of our core business lines and believe this financing will provide the appropriate working capital for the year ahead,” said Hugh Kinsman, chief financial officer, in a statement. “New retail partners already in talks to launch VLN in additional states as part of our national-scale distribution capabilities are expected to increase our manufacturing and inventory requirements. Additionally, the continued growth in customer demand at GVB has increased our capital needs for bulk ingredients and inventory going forward.”
In conjunction with the new credit facility, 22nd Century has also extended the maturity of $2.7 million in legacy seller notes assumed with its acquisition of GVB Biopharma to mid-2024. The company will file a Form 8-K with the Securities and Exchange Commission with complete details of the new debt facility and the terms of the refinanced legacy seller notes.
March 6, 2023
Webinar on FDA Warning Letters
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The U.S. Food and Drug Administration has posted a new webinar to help manufacturers and vape shop owners respond to warning letters from the agency’s Center for Tobacco Products (CTP).
The webinar outlines the appropriate items for a response to a warning letter, which should be received by FDA within 15 business days. The webinar also includes an explanation of proper documentation concerning corrective actions that entities have taken.
In the webinar, participants will learn about:
Preparation for a response to CTP
Important items to include in a response
Additional compliance resources
March 6, 2023
Habano Festival Concludes With Gala

Photo: Timothy Donahue
The 23rd Habano Festival culminated March 3 with the gala dinner held at the Pabexpo Fairgrounds in Havana. Around 1,200 attendees enjoyed the night complemented by national and international music, dance and indoor fireworks. The gala was also honored by the presence of Cuban President Miguel Diaz Canel, who attended the event along with other government authorities.
The evening paid tribute to the Partagas brand with the launch of the Linea Maestra, the brand’s most premium line, made up of three new vitolas: Origen (46 ring gauge x 154 mm length), Rito (52 ring gauge x 168 mm length) and Maestro (56 ring gauge x 132 mm length). Each of these vitolas will reach the market in a special case containing 20 units.
For the first time in the history of the brand and the Habanos portfolio, the vitolas of this new Partagas line will be made with 100 percent tobacco grown in San Luis, in the Vuelta Abajo plantations located in the Pinar del Rio region.
The gala night also featured a Hall of Fame that illustrated the great work of the people who have made the Habano what it is today.
One of the highlights of the evening was the auction of the exclusive humidors dedicated to the six global Habanos brands: Cohiba, Montecristo, Romeo y Julieta, Partagas, Hoyo de Monterrey and H. Upmann. The proceeds reached a total of €11,220,000 ($11,965,309) and will be donated to the Cuban public healthcare system.
March 6, 2023
Altria Exchanges Juul Stake for HTP License

Photo: Juul Labs
Altria Group has exchanged its entire investment in Juul Labs for a non-exclusive, irrevocable global license to certain of Juul’s heated tobacco intellectual property.
“We believe exchanging our Juul ownership for intellectual property rights is the appropriate path forward for our business,” said Altria CEO Billy Gifford in a statement. “Juul faces significant regulatory and legal challenges and uncertainties, many of which could exist for many years. We are continuing to explore all options for how we can best compete in the e-vapor category.”
As of Dec. 31, 2022, the carrying value and estimated fair value of Altria’s Juul investment was $250 million. Altria will record the financial impact of the agreement in the first quarter of 2023 and intends to treat any such amounts as a special item and exclude it from its adjusted diluted earnings per share.
“The return of Altria’s equity stake and termination of underlying agreements affords us full strategic freedom—we are no longer limited by the terms of those agreements to pursue other strategic opportunities and partnerships,” wrote Juul in a statement. “We are free to take advantage of a range of options to maximize the value of our company while we continue to advance our leading product technology and innovation pipeline.”
In late 2018, Altria paid nearly $13 billion for a 35 percent stake in Juul. “We have long said that providing adult smokers with superior, satisfying products with the potential to reduce harm is the best way to achieve tobacco harm reduction,” said Altria’s then-CEO Howard Willard at the time. “Through Juul, we are making the biggest investment in our history toward that goal. We strongly believe that working with Juul to accelerate its mission will have long-term benefits for adult smokers and our shareholders.”
Over the years that followed, however, regulatory scrutiny and litigation relating to Juul’s marketing practices severely eroded Juul’s valuation. On June 23, 2022, the U.S. Food and Drug Administration ordered Juul Labs to pull its e-cigarettes from U.S. store shelves, saying the e-cigarette manufacturer had submitted insufficient evidence that they were “appropriate for the protection of the public health.” After Juul challenged the marketing denial order (MDO), the FDA agreed to take another look at the company’s pre-market tobacco product application.
The agency said it had determined that there are scientific issues unique to the Juul application that warrant additional review.
In early September, Juul Labs agreed to pay nearly $440 million to settle a two-year investigation by 33 U.S. states into the marketing of its vaping products, which critics have blamed for sparking a surge in underage vaping.
On Sept. 30, Altria announced it was ending its noncompete agreement with Juul. The tobacco giant is reportedly in talks to buy Njoy Holdings for at least $2.75 billion. Njoy has a roughly 2 percent of the U.S. vape market by volume, according to Jefferies. Juul, by contrast, accounts for around a quarter of American vapor product sales. Unlike Juul, however, Njoy has FDA permission to sell its products in the U.S.
“While our appeal of FDA’s now-stayed MDO remains pending, we remain as confident in our science and evidence to support the continued marketing of Juul products,” Juul wrote after Altria announced the exchange of its investment for a license. “We also continue to pursue future applications for new products to accelerate our mission and progress for the adult smoker, public health, and an end to combustible cigarettes.”
March 4, 2023
Growers Discuss Tobacco’s Prospects

Photo: ITGA
Tobacco growers’ representatives from Argentina, Brazil, Colombia, the Dominican Republic and the United States gathered in Salta, Argentina, to discuss the challenges and opportunities facing their sector during the International Tobacco Growers’ Association (ITGA) 2023 Americas Meeting.
In addition to dealing with the Covid-19 pandemic, tobacco growers have struggled with skyrocketing production cost, stagnating leaf prices and increasing regulatory pressures. To cope with the challenges, ITGA member associations have been urging their respective governments to support the sector. The ITGA urges international institutions to respect tobacco growers and include them in the debates where their future is being decided.
Key discussion points during the regional meeting included the World Health Organization’s Framework Convention on Tobacco Control (FCTC) and the Conference of the FCTC Parties (COP), which is scheduled to take place in Panama this year. ITGA representatives deplored the COP’s lack of transparency and resistance to include industry representatives in its deliberations. Since COP4 in 2010, meetings have not been held in public.
ITGA President Jose J. Aranda highlighted the steps Argentinian growers have taken to ensure the livelihoods of local farmers. Aranda underlined the multitude of threats facing tobacco, including cost of production and climate issues, and the stigmatization of the sector, which he stressed operates in a legal market and complies with all the regulations imposed on it.
ITGA CEO Mercedes Vazquez recognized the pioneering spirit of Argentinian tobacco growers and their substantial contribution to local economies. She commended Argentina’s Special Tobacco Fund, a unique provision that has enabled tobacco growers to make a dignified profit margin from their work.
Michiel Reerink, director of corporate affairs at Alliance One International, examined the global regulatory environment while Benjamin Dessart, vice president of external affairs at Universal Leaf, reviewed the latest legislative initiatives in the Americas region.
ITGA Manager of Tobacco Industry Analysis Ivan Genov evaluated the threats and opportunities for tobacco growers. These include the rising costs of production, political and economic uncertainty, along with a disequilibrium of supply and demand for tobacco leaf.
ITGA member associations shared the latest crop estimates and discussed the issues in their respective markets. Special attention was paid to the situation in the host country, Argentina, where out-of-control inflation is causing serious obstacles for growers. Argentinian associations also highlighted several sustainability initiatives to tackle social and environmental issues.
The participants in the meeting agreed that they will have to work closely together to tackle the increasing challenges facing the sector.
March 3, 2023
Taat to Acquire Smoking Cessation App

Photo: Gilles Paire
Taat Global Alternatives plans to acquire Break Free, a smartphone application designed to provide smoking cessation strategy recommendations, from Boksburg Ventures, according to a Taat press release. Taat anticipates that Break Free could play a strategic role in the marketplace positioning of its flagship product Taat, a nicotine-free and tobacco-free alternative to tobacco cigarettes.
Break Free uses a holistic approach to ﬁrst monitor and track smoking-related habits of adult tobacco users, analyze the habits and then suggest customized changes that are speciﬁc to each adult smoker to ensure personalized care and attention.
The Break Free mobile app uses state-of-the-art technologies, including a companion diagnostics module to help adult smokers personalize and customize the use of currently available U.S. Food and Drug Administration-approved smoking cessation devices, augmented and virtual reality mental health simulations, and circadian rhythm sensors to monitor actigraphy, sleep/wake cycles and snoring.
The app has not yet been made available to consumers and remains subject to further development. Upon completion of the proposed transaction, Taat plans to complete the development of the app for use by consumers on the Android and iOS smartphone platforms by integrating additional features that are currently under patent applications with the U.S. Patent and Trademark Office.
Subject to approval by at least two-thirds of the votes cast at Boksburg’s shareholders meeting scheduled on April 10, 2023, Taat has agreed to issue to Boksburg on closing an aggregate of 17 million common shares of Taat at a deemed value of $0.3225 per consideration share and $3.6 million of working capital.
March 3, 2023
Researchers Propose New Definition of COPD

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While smoking plays a key pathogenic role in chronic obstructive pulmonary disease (COPD), other factors play a role as well, according to the authors of the 2023 Global Initiative for Chronic Obstructive Lung Disease (GOLD) report.
To better reflect the varied contributors to COPD, the report proposes a new definition of COPD.
The GOLD 2023 report defines COPD as “a heterogeneous lung condition characterized by chronic respiratory symptoms (dyspnea, cough, expectoration, exacerbations) due to abnormalities of the airways (bronchitis, bronchiolitis) and/or alveoli (emphysema) that cause persistent, often progressive, airflow obstruction.”
“The updated definition focuses on patient characteristics that then allows us to go into etiology and diagnostic criteria in more detail separately,” said MeiLan Han, chief of pulmonary and critical care medicine at the University of Michigan and a co-author of the GOLD 2023 report, in a statement. “This is important because we now can better emphasize all of the factors that can contribute to COPD beyond tobacco exposure.”
In low-income and middle-income countries, which contribute to over 85 percent of all COPD cases worldwide, “nonsmoking COPD may be responsible for up to 60 [percent] to 70 percent of cases,” noted the report’s authors. Other risk factors, they said, include environmental factors, such as indoor and outdoor air pollution; lung development and aging; socioeconomic status; asthma and airway hyper-reactivity; and infections.
March 3, 2023
BAT Releases Combined Annual and ESG Report

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BAT has issued its first Combined Annual and ESG Report, which embeds detailed information on sustainability and environmental, social and governance (ESG) into its statutory annual report.
New and updated targets have also been announced in the report, including: achieving a 30 percent renewable energy target by 2025, two years early, resulting in a revised target of 50 percent renewable energy by 2030; increasing the initial target of 15 percent reduction in waste from BAT’s operations by 2025 to 25 percent; expanding the scope of BAT’s 100 percent reusable, recyclable or compostable packaging commitment, beyond just plastic, by 2025; and setting a new target of zero conversion of natural ecosystems in its tobacco supply chain by 2025.
“BAT is proud to further enhance its sustainability reporting with its first Combined Annual and ESG Report,” said Mike Nightingale, BAT’s chief sustainability officer. “Sustainability and ESG matters are increasingly recognized as having a significant impact both on society and on how well a company performs. A combined report shows our strong commitment to transparent reporting and integrating sustainability and ESG matters into how we manage our business.
“We are making good progress in advancing our sustainability strategy and building ‘A Better Tomorrow.’ We are reducing the health impact of our business and further increasing our ambitions as we drive our business transformation. In 2022, for example, we increased the number of consumers using our noncombustible products to 22.5 million while at the same time reducing Scope 1 and 2 GHG emissions by 15 percent versus 2021. We know we have more to do and look forward to delivering on our ambitious targets.”
This report also includes results of BAT’s first Double Materiality Assessment, an approach to assessing impacts that helps the company to further shape the most important sustainability priorities and actions. Such an approach looks not only at how its business impacts sustainability issues but also how sustainability-related matters impact its business.
March 2, 2023
MEPs Ignorant about New Nicotine Products

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Members of the European Parliament (MEPs) are less aware of key issues surrounding new nicotine products than in previous years despite being asked to vote on important new legislation concerning the topic in the coming months, according to a new survey, reports BusinessWire.
The third annual survey, conducted by business intelligence researcher Tamarind Intelligence, publisher of ECigIntelligence and TobaccoIntelligence, shows that the more MEPs know about new nicotine products (e-cigarettes, nicotine pouches and heated tobacco), the more likely they are to consider that these products are less harmful than cigarettes.
The report shows that: MEPs rarely believe that new nicotine products are as harmful as smoking—only 19 percent of responses, the lowest number since the annual survey was launched in 2020—and a majority believe they are less harmful than smoking; MEPs with no knowledge of new nicotine products are becoming far more likely to acknowledge that they don’t know the risks; MEPs with some knowledge of new nicotine products strongly tend to believe (76 percent of responses) that they are less harmful than smoking; and while very few MEPs consider that new nicotine products should be more restricted than traditional tobacco, and a majority believe online sales should be allowed for adults (with age verification), more MEPs are unsure how they should be regulated than in previous years.
“Our third annual MEP survey results are particularly relevant given the recent launch of the European Commission’s public consultation on evaluating the legislative framework for tobacco control at the end of February 2023 and the adoption by the European Parliament of the BECA committee’s recommendations over a year ago,” said Tim Phillips, managing director of Tamarind Intelligence. “As some of the questions in the commission’s consultation are similar to the ones we asked in our MEP survey, it will be fascinating to see if MEPs’ views on the topic of new nicotine products will be in line with responses to the public consultation.”
The survey was carried out online and anonymously, and all data from it remains confidential other than as used in consolidated analysis. The survey was sent to all MEPs (from all member states and political parties), and responses were obtained from 43 MEPs representing 6 percent of the European Parliament.
March 2, 2023