Category: Featured

  • Imperial on Track to Meet Guidance

    Imperial on Track to Meet Guidance

    Photo: Igor Golovnyev

    Imperial Brands continues to make progress toward its five-year strategy to transform the business and remains confident it will deliver the full-year accelerated adjusted operating profit growth in line with its previously stated medium-term guidance, the company wrote in a press release.

    For the full year, on a constant currency basis, tobacco and next-generation product (NGP) Imperial Brands expects net revenue to grow at a low single-digit rate with group adjusted operating profit growing at a rate close to the middle of the company’s mid-single-digit range.

    Constant currency tobacco and NGP net revenue growth has strengthened over the same period last year underpinned by strong combustibles pricing and growth in the company’s NGP business. In combustibles, focused investment in Imperial’s five priority markets continues to support resilient aggregate market share with gains in the U.S., Spain and Australia, broadly offsetting declines in Germany and the U.K. These results are consistent with Imperial’s medium-term objective to hold or grow aggregate share across these markets. At the same time, Imperial says it has delivered strong pricing, more than offsetting wider industry volume pressures in certain markets.

    The company expects NGP first-half net revenues to grow in the mid-teens to high-teens at constant currency. Imperial is now present in more than 20 European markets and the U.S., and in the first half, Imperial launched innovative products in all three categories, including new single-use formats under the Blu brand, new iSenzia nontobacco heat sticks and entry in the U.S. oral nicotine category with the Zone range of pouches.

    The company projects growth in first-half group adjusted operating profit to be at low single digits on a constant currency basis, reflecting the anticipated second-half weighting of performance. In the first half, constant currency tobacco adjusted operating profit will be ahead of last year with good performances in Europe and Americas more than offsetting a softer performance in the AAACE region, which benefited from a very strong comparator period.

    Imperial says it is also improving its NGP gross margins as it builds scale and is reducing NGP operating losses alongside continued investment in line with the company’s plans. First-half group adjusted operating profit has also benefited from growth in distribution, reflecting performance at Logista, the Spanish-based distribution business in which Imperial has a 50.1 percent stake.

    The interim results for the six months ended March 31, 2024, will be announced on May 15, 2024.

  • Qnovia Expands Scientific Board

    Qnovia Expands Scientific Board

    Photo: Mariakray

    Qnovia has appointed four new members to its scientific advisory board (SAB). The new members are Neal Benowitz, professor at the University of California at San Francisco, Ian M. Fearon, independent consultant, Darla E. Kendzor, professor at University of Oklahoma Health Sciences Center, and Nicole Nollen, professor at University of Kansas.

    “Our newly appointed advisors bring world-class scientific and multi-disciplinary expertise and reaffirm our commitment to advance novel therapies for the millions of people who seek to quit smoking,” said Qnovia CEO Brian Quigley in a statement.

    “We are grateful for the leadership of the chair and founding member of our SAB, Dr. Jasjit S. Ahluwalia, a professor at Brown University, who has been instrumental in shaping the direction of our SAB over the past year. The expansion of our SAB complements the regulatory expertise of our policy and regulatory strategy advisor, Mitch Zeller, who served a prior appointment as director of FDA’s Center for Tobacco Products.”

    Qnovia is a pharmaceutical company developing inhaled therapeutics across a variety of indication areas leveraging its proprietary inhaled drug delivery platform, the RespiRx.

    “Looking ahead, our SAB will serve a critical role as we advance the clinical development of our lead asset, QN-01, towards FDA and MHRA approval,” Quigley said. “We believe our proprietary drug-device combination platform has the potential to be a first-in-class and best-in-class treatment for smoking cessation.

    “Last fall, QN-01 demonstrated a superior pharmacokinetic profile compared to existing nicotine replacement therapies in our first-in-human Phase 1 clinical trial. We plan to submit our IND and CTA to the regulatory bodies and look forward to commencing our Phase 1/2 clinical study this year. Overall, we are highly encouraged by the data we have generated to date and believe that 2024 is going to be a pivotal year for Qnovia,” he added.

  • Pakistan Tobacco Firm Protests ‘Illegal’ Raid

    Pakistan Tobacco Firm Protests ‘Illegal’ Raid

    Photo: sezerozger

    Pakistan’s Walton Tobacco Co. has called on the Azad Jammu and Kashmir government to reopen the company’s offices, alleging that the company has been illegally sealed before Eid-ul-Fiter, the Muslims’ largest religious festival, reports Business Recorder. The closure has resulted in sudden unemployment for more than 400 employees.

    “We urge the authorities to immediately open the company and restore livelihoods of hundreds of workers,” said Arif Zia, spokesperson for the Walton Tobacco Co.

    “We are doing business and paying taxes for the last 18 years,” said Zia, adding that the company is the highest taxpayer in Kashmir. The company stated that it had been illegally raided, products had been seized, and they were threatened with serious consequences by the authorities.

    According to the manufacturer, authorities in Azad Jammu and Kashmir did not issue any “show cause” notices to the company or conduct income tax audits before suddenly sealing all the offices.

    “We will be forced to relocate businesses elsewhere if this trend continues,” the tobacco company said, noting that the government is conducting enforcement action as a show and that law enforcement has not taken any action against illegal cigarette sales.

    Law enforcement seized the company’s trucks during transportation rather than at excise check posts; the company is allegedly missing 200 trucks.

  • Zimbabwe Seed Producer Shuts Down

    Zimbabwe Seed Producer Shuts Down

    Photo: Taco Tuinstra

    Zimbabwe Tobacco Seed Association (ZTSA) has stopped production and is closing down after failing to secure parent seed, reports NewsDay. The company expressed fears that this will affect the billon-dollar tobacco leaf sector.

    “We have not had the chance to get parent seed for the past six years, and it pushed us out of business,” said Mildred Kamusasa, ZTSA executive committee chairperson. “We had over 400 workers as part of the seed production company. Sadly, the company is not relocating, but we are shutting down operations and liquidating.

    “There is no hope that we can come back into play any time soon.”

    “While the closure of ZTSA is disheartening, rest assured that the supply of tobacco seed will continue without any compromise,” said Tatenda Mugabe, public relations and communications officer at Zimbabwe’s Tobacco Research Board.

  • FDA Chief to be Grilled

    FDA Chief to be Grilled

    Robert Califf (Photo: FDA)

    The U.S. House Oversight and Accountability Committee will question U.S. Food and Drug Administration Commissioner Robert Califf as part of an investigation into the agency’s handling of tobacco and nicotine products regulation, among other issues, according to a press release.

    Last year, the committee announced an investigation into the FDA Center for Tobacco Products (CTP). “We have deep concerns that the CTP’s decisions have been influenced by political concerns rather than scientific evidence,” wrote Oversight Committee chairman James Comer in a letter for Califf. “Comments from FDA staff to RUF [the Reagan-Udall Foundation] … reflect such concerns.”

    Other members of Congress have also questioned the FDA’s commitment to fair regulation, with a bipartisan group of senators asking Califf in 2023 to explain the FDA’s premarket tobacco product application process.

    The hearing is scheduled for April 11 at 1 p.m. EDT. It will be live streamed on the committee website and on YouTube.

  • 22nd Century to Eliminate Senior Debt

    22nd Century to Eliminate Senior Debt

    Photo: Photo: Jade

    The step is part of an effort to put the company back on a path to growth, says CEO Firestone.

    22nd Century Group has entered into an agreement with its senior secured lender to eliminate all of its senior secured debt through potential debt for equity exchanges. Additionally, the company has entered into separate definitive agreements for the purchase of common stock and warrants.

    The company also announced the appointment of Daniel Otto as chief financial officer (CFO) and Jonathan Staffeldt as general counsel. Both are currently employed at 22nd Century Group, Otto as corporate controller and Staffeldt as vice president and deputy general counsel. R. Hugh Kinsman, the company’s current CFO, will leave the company on June 1, 2024.

    “We are putting 22nd Century back on a path to growth, and eliminating our debt is another key step in cutting our external operating cash needs,” said 22nd Century chairman and CEO Larry Firestone in a statement.

    “Combined with a new contract manufacturing customer announced last week that is expected to increase our CMO volumes by at least 20 percent and our plans to build a new tobacco harm reduction category around our FDA-authorized VLN products, we intend to become cash positive by the first quarter of 2025.

    “Dan and Jonathan have been key contributors to these turnaround efforts at 22nd Century, helping us to exit the hemp/cannabis business and significantly reduce our quarterly cash use as reported in our year-end results,” Firestone added. “I also want to thank Hugh for his hard work on behalf of 22nd Century, and in particular over the past several months as we worked to transform our financial footprint.”

  • Nepal to Ban Vapes as ‘Tobacco’ Use Spikes

    Nepal to Ban Vapes as ‘Tobacco’ Use Spikes

    Photo: Taco Tuinstra

    Nepal is poised to ban e-cigarettes, according to Bhakta Bahadur KC, information officer at the National Health Education, Information and Communication Center, reports MyRepublica.

    The legislation is a response to rising e-cigarette use among youth. Nepal imported 3.2 million e-cigarettes in 2023. The business is worth an estimated NPR210 million ($1.5 billion).

    Contradicting studies suggesting that vaping is at least 95 percent less risky than smoking. KC said e-cigarettes are as harmful to health as cigarettes.

    In related news, a recent survey by the Nepal Development Research Institute revealed that 34.1 percent of the Nepalese population uses tobacco in one form or another, up from 31.8 percent in 2020.

    Nearly 18 percent of those aged between 15 to 24 use tobacco, with 8.9 percent preferring smoking and 6.3 percent prefer smokeless tobacco. A small percentage (2.7) engages in both practices. Among individuals aged between 25 to 39, tobacco use is at 26.5 percent, with 8.7 percent of them smoking, 13 percent using smokeless tobacco, and 4.9 percent doing both.

    Likewise, 41.6 percent of individuals aged between 40 to 54 use various forms of tobacco products. Within this age group, 11.1 percent smoke, 26.7 percent use smokeless tobacco products and 3.7 percent use both. Similarly, among those aged 55 to 69, tobacco product usage is at 56.7 percent—16 percent smoke, 33.8 percent use smokeless tobacco, and 6.8 percent use both forms of tobacco.

    Among the male population of the country, 55.8 percent of men use some form of tobacco, while 11.2 percent of women use tobacco.

    NDRI researcher Kamal Chaulagain attributed the rise of tobacco consumption to the increasing popularity of hookah and e-cigarettes, which some users view as smoking alternatives, and called for higher taxes.  

    NDRI head Jaya Kumar Gurung, blamed lax enforcement of the Anti-Smoking Act. He emphasized the lack of public awareness regarding the harmful effects of tobacco products.

  • Digital Age Checks Deployed in Netherlands

    Digital Age Checks Deployed in Netherlands

    Similar technology has also been trialed in Italy. (Photo: Innovative Technologies)

    Parts of the Netherlands have implemented face scanners to check consumers’ ages before selling cigarettes to them, according to Dutch News.

    About 100 outlets have opted for face scanners so far. The camera uses artificial intelligence to scan a customer’s face and estimates their age based on features such as skin condition and wrinkles. If the customer is thought to be over 25, the transaction can continue, but if not, the machine will ask to scan the customer’s ID.

    “The process is similar to that at airports,” said Theo Snijders, CEO of H@nd, the scan-making firm.

    The legal framework was devised with product safety organization NVWA, privacy watchdogs and lawyers to ensure that customers’ personal data are not compromised. The scanners do not store data and only record the number of scans. According to Snijders, a scan is not a condition for buying tobacco as that would be illegal.

    Sellers caught not complying with age check requirements could face fines up to €9,000 or a temporary loss of their license to sell tobacco products.

    Beginning July 2024, tobacco products can only be legally sold at specialist stores and gas stations.

    Tech firms and vape stores have been experimenting with digital age-verification tools in various markets. Tobacco Reporter profiled one such project in Italy  in its December 2023 edition. (See “Beyond Face Value”).

  • U.S. Vape Market Tops $2.67 Billion

    U.S. Vape Market Tops $2.67 Billion

    Photo: auremar

    The combined sales of cartridge-based and disposable e-cigarette products to U.S. consumers by nine leading manufacturers increased by approximately $370 million between 2020 and 2021, while the total topped $2.67 billion, according to the Federal Trade Commission’s (FTC) third report on e-cigarette sales and advertising in the United States, which was released on April 3, 2024. E-cigarette companies also spent $90.6 million more advertising and promoting their products in 2021 than in 2020.

    The FTC report examines two main types of e-cigarettes. Some have rechargeable batteries and changeable prefilled cartridges; others are disposable after running out of charge or e-liquid. Reported sales of cartridge products increased from $2.13 billion in 2020 to $2.5 billion in 2021; sales of disposable, non-refillable e-cigarette products increased from $261.9 million in 2020 to $267.1 million in 2021.

    The 2021 report also provides details on some characteristics of e-cigarette products, including flavors and nicotine concentration, as well as the bundling of the components in cartridge systems. The data shows that in 2021, 69.2 percent of e-cigarette cartridges either sold or given away contained menthol-flavored e-liquids, and the rest were tobacco-flavored.

    Disposable e-cigarettes are not covered by the flavor restrictions imposed by the Food and Drug Administration. In 2021 “other” flavored devices made up 71 percent of all disposable devices sold or given away, with the most-popular subcategories being fruit-flavored and fruit & menthol/mint flavored products. These two subcategories alone made up more than half of all disposable e-cigarette devices sold or given away in 2021.

    According to the report, expenditures for the advertising and promotion of e-cigarettes increased from $768.8 million in 2020 to $859.4 million in 2021, with the three largest spending categories being price discounts, promotional allowances paid to wholesalers, and point-of-sale advertising. Together, these three categories accounted for almost two thirds of expenditures in 2021.

    Finally, the report discusses steps that e-cigarette companies took in 2021 to deter or prevent underage consumers from visiting their websites, signing up for mailing lists and loyalty programs, or buying e-cigarette products online. These steps include the use of online self-certification to verify users were at least 21 years old and following state laws requiring an adult signature upon delivery of e-cigarette products.

  • 22nd Signs Contract Manufacturing Deal

    22nd Signs Contract Manufacturing Deal

    Photo: www.akolosov.art

    22nd Century Group has signed a significant new contract manufacturing agreement for the production of branded conventional cigarette products. The contract, which will commence revenue generation in the second quarter of 2024, is expected to increase carton production volumes at 22nd Century’s manufacturing facility by more than 20 percent when fully implemented.

    “We are excited to announce this new contract, the first result of our efforts to profitably grow our contract manufacturing business in North Carolina while also working to build our VLN franchise through the development of a new category focused on tobacco harm reduction,” said 22nd Century Chairman and CEO Larry Firestone in a statement.

    In line with the operating targets outlined on our most recent results call, this agreement helps us to scale revenue, improve gross margin and achieve our goal of breakeven operations by the first quarter 2025.”