BAT has further increased its investments in the cannabis industry.
By Stefanie Rossel
In its endeavor to transform its business, initiated in 2020 under the slogan “A better tomorrow,” BAT is increasingly focusing on the cannabis sector to diversify beyond tobacco and nicotine. Two years after its first venture into the hemp market, the group currently has partial stakes in 13 cannabis startups, more than any other tobacco company, according to Seeking Alpha, a financial services provider.
BAT’s most recent move in this direction is a joint venture with Denver, Colorado-based cannabidiol (CBD) producer Charlotte’s Web Holdings in early April. BAT’s subsidiary AJNA Bio Sciences, a botanical drug development company focused on mental health and neurological disorders, has teamed up with Charlotte’s Web and is contributing $10 million as the joint venture’s initial investor. AJNA was co-founded and is partially owned by its president, Joel Stanley, the former CEO and chairman of Charlotte’s Web, together with other founding members of Charlotte’s Web.
The aim of the cooperation is to develop from propriety Charlotte’s Web hemp genetics a botanical drug targeting a neurological condition and pursue approval by the U.S. Food and Drug Administration. While the joint venture did not disclose the neurological condition, observers suspect that the drug is aimed at the treatment of seizure disorders. Charlotte’s Web is also the name of a hemp strain from which an oil can be made that can be used to treat Dravet syndrome and other epilepsy diseases.
The strain, which contains 17 percent CBD and 0.5 percent of the psychoactive ingredient tetrahydrocannabinol, was bred in 2011 by the Stanley brothers to treat a young girl suffering from a severe form of pediatric epilepsy that did not respond to commonly used anti-epileptic drugs. Encouraged by the patient’s positive response to their CBD oil, the brothers established a nonprofit organization to give seizure patients access to high-quality cannabis with a high CBD content. With their advocacy, they helped change laws and public perceptions relating to plant-based solutions. Nevertheless, their product did not become the first treatment derived from cannabis plants to receive FDA authorization. That honor fell to Epidiolex, which contains only CBD and was approved by the agency in 2018.
The joint venture, in which BAT holds a 20 percent stake and Charlotte’s Web and AJNA have a 40 percent stake each, will be led by representatives of all three companies. Its clinical and regulatory strategy will be led by Orrin Devinsky, who was a principal investor in the FDA approval of Epidiolex. Apart from being AJNA’s chief medical advisor, he is also the director of New York City University Langone’s Comprehensive Epilepsy Center. The joint venture wants to file an investigational new drug application and commence phase I clinical development in 2023.
In November 2022, BAT paid £48.2 million ($60.36 million) for a 19.9 percent stake in Charlotte’s Web, a leading company in hemp extract products and the only publicly traded CBD B Corp-certified company. According to its latest financial reports, Charlotte’s Web generated revenues of $74.13 million in 2022.
In mid-March, a major shareholder urged BAT to move its primary stock market listing from London to New York. About 60 percent of BAT’s profits come from the U.S. while only 1 percent is generated in the U.K. With a move to the U.S., analysts argued, the FTSE 100-listed company would not only gain an investor base with greater appreciation of reduced-risk products but also be better equipped if it wanted to venture into the cannabis markets. U.K. law prohibits a company from listing if its profits are sourced from recreational cannabis, even if they are earned in a jurisdiction where marijuana is legal. Although similar restrictions currently exist in the U.S., analysts expect these issues to be addressed in the near future.
With its recent investments, BAT continues its exploration of the cannabis business, which started in March 2021, when it acquired a minority stake in Organigram Holdings of Canada for CAD221 million ($175 million at the time). Canada legalized cannabis in October 2018. Through a number of acquisitions and organic growth, Organigram has since become the second-largest licensed cannabis producer in Canada.
Stefanie Rossel is Tobacco Reporter’s editorial contributor. An experienced trade journalist, she combines sharp reporting skills with in-depth knowledge of the tobacco and vapor industries. Prior to joining Tobacco Reporter, Stefanie was editor-in-chief at Tobacco Journal International, where she worked for a decade. Fluent in English, German and French, Stefanie covers tobacco news around the world. She is based in Germany.
How the EU’s ambition to overhaul its packaging legislation might impact the tobacco industry.
By George Gay
As I understand things, a human body can be composted, in those places where this practice is legal, within about 30 days. On the other hand, my experience is that some starched-based “fully compostable” packaging can take more than 600 days to break down completely. Such a difference in composting times gives pause, I think, and I have long felt that the messaging around compostable packaging could do with some fine-tuning.
So I was encouraged, at least on behalf of those living in the EU and countries that follow EU packaging rules, to see that the EU Commission, as part of its proposed overhaul of its packaging legislation, is seeking to clear up the confusion around bio-based, biodegradable and compostable plastics.
In an end-of-November press note titled “European Green Deal: Putting an end to wasteful packaging, boosting reuse and recycling,” the commission announced its proposed revision (see https://bit.ly/3F6PRfp) of the EU’s legislation on packaging and packaging waste, saying that while the production and use of bio-based, biodegradable and compostable plastics had been increasing, a number of conditions had to be met for these plastics to have positive environmental impacts rather than exacerbating plastic pollution, climate change and biodiversity loss. “The commission’s new framework clarifies in what way these plastics can be part of a sustainable future,” it added.
In my view, it is important that the proposals, which must now be considered by the European Parliament and Council, are successful in their aims. The commission says a circular economy of packaging will help decouple economic development from the use of natural resources, contribute to achieving climate neutrality by 2050 and halting biodiversity loss, and reduce the EU economy’s dependency on many materials. Specifically, it estimates that by 2030 its proposed measures would bring greenhouse gas emissions from packaging down to 43 million tons compared to 66 million tons if the legislation is not changed. (Detailed impact assessment documents can be accessed at https://bit.ly/42cYEXd.)
Impacting Industry
These proposals, which are said to be aimed at creating a level playing field of packaging that is not more trade restrictive than necessary to fulfill the environmental objectives, will impact all companies working within the EU and those selling into the region, including those working within the tobacco and nicotine industries, though some exemptions apply to small companies. The use of packaging is universal, and the materials covered by the proposals include aluminium, cardboard, ceramics, glass, metal, paper, plastic, porcelain, stoneware, textiles and wood.
But, just to be certain where the tobacco industry would stand, I wrote to the commission asking if I would be correct in assuming that all the proposals finally accepted by the parliament and council would apply to the tobacco industry, in respect of both its leaf tobacco and its product (including new-generation products) packaging.
Interestingly, the commission chose to answer a different but related question by saying, “The tobacco industry would certainly [my emphasis] not be exempt from these rules according to our proposals.” I thought this answer, apart from being a little sniffy, was interesting because it seemed to assume that, despite a history of disadvantages being heaped on tobacco industry packaging, I had been wondering whether the industry could, suddenly and miraculously, expect to be advantaged by being exempted from some of the proposed rules.
In fact, my thoughts had been going in another direction. I had been wondering whether the tobacco industry and its much put-upon consumers might be well served by being treated equally with other industries for once. As I understand it, the commission proposals, in part, are about incentivizing innovation, something the industry might want to examine.
Buying in Bulk
If the proposals applied across the board, the tobacco products industry might, for instance, be encouraged to participate in refillable initiatives, which are mentioned in the proposals as a way of reducing the use of packaging materials. It could be imagined that, under such a scheme, cigarette consumers might buy from their local store cigarettes obtained from bulk packs and taken away in reusable containers. Clearly, with the exception of the bulk packs, which would be seen only by a limited number of people, possibly mainly nonsmokers, this would put paid to the grotesque health warnings that smokers, unlike alcohol drinkers, have to endure.
I cannot imagine the tobacco industry being allowed to apply such a system given that it has in the past been dissuaded, both by external or, rather more shockingly, internal forces, from introducing environmental incentives into its packaging because of the idea that, in the mind of consumers, environmental claims equal health claims. This idea, I suspect, would be impossible to defend, but it persists.
But why should the industry not be allowed to apply such a system? Where is the moral line to be drawn here? Is it right for the commission, despite what it says, to apply exemptions to the tobacco industry? Is it defensible for the commission to hang onto these health warnings, which have dubious moral or practical underpinnings, in an attempt to dissuade smokers from continuing with their habit? Remember, to disallow such a tobacco industry initiative would, in the commission’s view, discourage the use of more environmentally friendly packaging and thereby make the world a riskier place for everybody.
Certainly, if it does decide to disadvantage the tobacco industry, it should do the same with any number of other industries, such as the automotive industry, which destroys lives in much the same way (and other ways) as the tobacco industry is said to destroy lives. Sections of the automotive industry, too, have been deceptive about the risks caused by the use of their products and, in their case, about the extent to which such use endangers the public at large rather than just the users of their products.
Action Needed
Having said that, while I do not work in packaging and cannot speak for the practicality or efficaciousness of individual proposals, it is clear to me that action needs to be taken in respect of the three stated objectives of the proposed revisions. Firstly, to prevent the generation of packaging waste by reducing it in quantity, restricting unnecessary packaging and promoting reusable and refillable packaging.
Secondly, to boost high-quality (“closed loop”) recycling by making all packaging on the EU market recyclable in an economically viable way by 2030. And thirdly, to reduce the need for primary natural resources by creating a well-functioning market for secondary raw materials and increasing the use of recycled plastics in packaging through mandatory targets.
I like the emphasis on preventing wherever possible the generation of packaging, though it is important to note the commission makes clear that packaging plays a vital role in protecting and preserving products.
I also like the commission’s emphasis on having clear and consistent labeling on every piece of packaging to indicate what it is made of and to what waste stream it should go. This is not the case currently. The commission, in its proposals, makes the point that regulatory approaches differ from one member state to another, which means that, for instance, labeling requirements differ.
One concern has to be whether the new rules can be made to work, because previous rules haven’t, at least not satisfactorily. The commission says that its directive on packaging and packaging waste (94/62/EC – PPWD), which, under the latest proposals, is due to be repealed, was a regulatory failure that cannot be remedied simply by better enforcement of the current rules. Moreover, the commission added, the available data hinted that neither measures undertaken by the member states based on the current PPWD nor those based on the ORD [2020 Own Resource Decision] or SUPD [2019 Single-Use Plastic Directive], both of which would be amended under the proposals, were sufficient to ensure that they met all the specific targets for the recycling rates set out in the PPWD.
In trying to make the proposed rules more effective, the commission is aiming for them to be bound up in a regulation rather than in a directive, which seems to be a step in the right direction. Regulations are binding legal acts that must be applied in their entirety throughout every member state whereas directives are legislative acts that set goals that all states must achieve but that allow room for individual states to devise their own laws for achieving those goals.
Finally, the press note included a couple of comments, and in part, Virginijus Sinkevicius, the EU commissioner for Environment, Oceans and Fisheries, made the point that we had all at one time or another received products that, ordered online, had arrived in excessively large boxes. I’m sure there is a lesson to be learned from this claim, but I hope that such knowledge does not lead only to the examination of packaging, which is merely a symptom of a social problem. Tracking back to the cause will show, I think, that we need to examine, too, our buying habits. For those of us lucky enough to be able to do so, we should surely try to buy less stuff and only from shops to which we can walk or cycle carrying reusable containers—including elegant cigarette cases.
George Gay is Tobacco Reporter’s European editor, but his territory spans the globe. Based in London, George has covered the tobacco industry since 1982, initially for a U.K.-based publication and since 2004 for Tobacco Reporter. George’s understanding of industry issues, combined with his keen sense of observation and dry wit, have earned him a loyal following among Tobacco Reporter’s readers.
Tobacco veteran Murray Prince is setting up tobacco operations in the Democratic Republic of the Congo.
By George Gay
Shortly after I had been asked to write a piece about leaf tobacco operations in Uganda and the Democratic Republic of the Congo (DRC), my daily newspaper carried, on the same page, a story on each of these countries. The stories focused on conflicts of various kinds and therefore appeared generally negative, which is not unusual for the coverage many British people would see of these two countries and, in fact, of many other African nations. There is no doubt that, seen from the outside by the person in the street, and, for some marginalized citizens, seen from the inside, the DRC and Uganda have their problems—some of them grievous and seemingly self-imposed.
But, with a few obvious exceptions, businesspeople tend to see things differently. Countries, wherever they are in the world, are seen basically as producers or markets that are more or less attractive than other countries. Conflicts comprise a negative factor when appraising a country, but they are not seen as barriers, providing those conflicts do not impinge directly and oppressively on business interests.
Such an approach can seem to be unethical, but, in one way at least, it can be seen to be the exact opposite. Shifting the focus back to Africa, businesses working within the leaf tobacco industry have been generally good at taking a practical approach and building operations, including, importantly, livelihoods, in places where others might fear to tread.
And so it is that Murray Prince, an experienced Africa-tobacco hand, is in the process of setting up and registering Market Link Services, through which he aims to coordinate various leaf operations in East Africa and the DRC, where he is working with Idi Taban, a businessman based in Kampala, Uganda, whose interests include a tobacco procurement and trading operation in the DRC: GGLC. Taban’s Uganda-based company, KKT, has interests, too, in transport, property and regional trading, and the plan, still being finalized, would see Taban retain overall control of his tobacco business in the DRC while handing over operational control and the day-to-day running of it to Prince.
In this role, Prince would manage all stages of GGLC’s DRC tobacco operations, including leaf production and procurement; he would oversee operations in Uganda, where the DRC tobacco would be processed and packed before being exported; and he would be responsible for marketing, sales and communications.
The Formula
Businesses in the leaf tobacco industry have been generally good at building operations and livelihoods in places where others might fear to tread. |
Photo: Francesca Volpi
The systems necessary to make all this transparent and workable have been put in place during the past 12 months, but, even still, Prince has no illusions about the challenges involved in operating in the DRC and, indeed, readily admits that his previous time there as a trader involved in production and procurement, from 2009 to 2012, was not easy and ultimately ended in failure. Nevertheless, failure is a form of experience that can be turned around, and he is up for the challenge, telling me that part of his role would require him to anticipate the risks and disruptions that, without early interventions, could cause operational challenges.
On the positive side, he has long experience in various African countries, which means, he says, that he is familiar with the strengths, weaknesses and sensitivities of these markets and that he has a “formula” for what needs to be done—by all participating parties—to make a success of the entire operation. His expertise, however, is in two broad areas, one of which encompasses sales, marketing and exports while the other comprises the skills, including those in specialized project development, management and supporting roles, required to set up new projects.
Originally from Zimbabwe, Prince started in the leaf trade in Malawi with Limbe Leaf, which later became part of Universal, before returning to Zimbabwe to work with Standard Commercial and, later, Zimbabwe Tobacco Brokers. He was then involved in or instrumental in three startups: Tobacco Handlers Zimbabwe, which also operated in Malawi, Leaf Buyers Zimbabwe and Southern Leaf Brokers. Since 2013, he has lived in the U.K. from where he has operated a tobacco consultancy and become involved in other trade-related interests.
Building Relationships
So, what are GGLC’s aims? Well, Prince says the first aim is to maintain the stable and sustainable production and procurement system and infrastructure that, for the past 15 years, have operated to the advantage of the company, its employees and the regional community, including tobacco farmers, their employees and families, who have also benefited from additional support services. And using that production and procurement system as a base, the next aim is to establish GGLC as the reliable leaf exporting company operating in the DRC, building long-term, trusted and mutually beneficial relations with international players that recognize the potential of the country’s niche market.
That’s it in a nutshell, but the devil will be in the details. Maintaining the production and procurement system will require ensuring the smooth operation of farmer registrations, agronomy support, input availability, storage and dispersal; and leaf buying, grading and baling. Then, Prince says, to avoid disruption as the tobacco is moved to Uganda for processing, close attention will be paid to logistics, compliance and documentation appropriate for meeting obligations for both the DRC and Uganda as well as internationally.
The plan, he says, is to have, as now, the DRC tobacco processed ahead of export at a facility in Jinja, Uganda, which is run by the Nilus Group, a partnership between Premium Tobacco and Uganda Tobacco Services that between them promote Ugandan Burley and dark-fired tobacco. Once processed, the tobacco will be moved for shipping from Jinja to Mombasa, Kenya, by an independent logistics group, Agrivest Shipping.
Straightening the Hassles
To the layman, this can start to look like a lot of effort for possibly not enough reward. So why do it? After all, even the GGLC DRC target of 10 million kg green weight is a drop in the ocean set against what can be grown in Zimbabwe, where, because of the importance of the tobacco crop, the infrastructure and systems, albeit probably not perfect, have been in place and functioning for years.
So let me see if I can get this right. It is worth the effort if the tobacco fits well into a final buyer’s cigarette blend in respect of both sensory factors and cost. Therefore, once a tobacco has been found to be a right fit, and the generally flavorful tobaccos produced in Africa have been highly prized by manufacturers for decades, it all comes down to price. But there are two prices in play here: the dollar price and the hassle price. Some big players have tried their hands in the DRC and Uganda and left, some having found that the hassle price was too high. The idea is that a smaller, more flexible player with experience in negotiating the inevitable business, industry and political chicanes can straighten out those hassles, which, as mentioned above, is why Prince is getting on board.
Much of what can be said about the DRC also applies to Uganda, where tobacco has been grown since at least the 1920s when BAT was active there but where, since the departure of that company’s stabilizing influence, flue-cured operations are currently said to lack a stable and balanced market. But therein lies an opportunity. Although BAT is no longer directly involved in the Ugandan leaf tobacco market, vestiges of the production expertise it left behind are still present, and so Taban and Prince believe the time is right to grasp the opportunity of entering the market for flue-cured tobacco. Prince told me there was a circularity, almost a natural rhythm to the way that smaller producers came into and went out of operation and that he believed the time was right in the region to take advantage of the moment and engage with grower communities and government departments that were now well disposed to such an initiative.
This seems as though it could be a good assessment of the situation. According to an October 2021 story by Gilbert Mwijuke that was published in the East African newspaper, leaf tobacco production in Uganda peaked at 18 million kg in 2013, when more than 75,000 farmers were said to be engaged in the industry. Since then, however, things have fallen apart somewhat, and by 2020, less than 10 million kg was produced, apparently at least partly because of grower prices. Geoffrey Ozuma, a crop scientist at the National Agricultural Research Organization in Hoima and a former tobacco farmer, was quoted in the story as saying that many farmers had been discouraged by declining prices. When certain companies came into the market, he said, prices dropped because those companies started providing farmers with inputs but then set low prices for leaf tobacco produced with it. “That uncertainty, coupled with rising costs of production due to increasing scarcity of essential inputs such as firewood, forced many farmers to give up,” he said.
How accurate these figures are is not known, and Prince treats most of the figures available with some skepticism. FAO figures tend to suggest that—presumably total—tobacco production in Uganda has been remarkably constant in recent years: 31.688 million kg in 2017, 32.762 million kg in 2018, 31.992 million kg in 2019, 32.277 million kg in 2020 and 32.563 million kg in 2021. Meanwhile, FAO figures for the DRC have been similarly constant: 3.774 million kg in 2017, 3.655 million kg in 2018, 3.562 million kg in 2019, 3.694 million kg in 2020 and 3.667 million kg in 2021.
But I guess that historical data is perhaps not important, providing as it is only a guide to what was possible in the past under the conditions and in the environment that then pertained. What is possible in the future will depend on any number of factors that are not necessarily easy to identify at present. That’s probably why it’s necessary to have people such as Prince and Taban in place. They’ve been there before and seen the changes wrought by business, industry and political upheavals.
George Gay is Tobacco Reporter’s European editor, but his territory spans the globe. Based in London, George has covered the tobacco industry since 1982, initially for a U.K.-based publication and since 2004 for Tobacco Reporter. George’s understanding of industry issues, combined with his keen sense of observation and dry wit, have earned him a loyal following among Tobacco Reporter’s readers.
Dholakia Tobacco is offering Indian smokeless tobacco products that are less hazardous than the country’s most commonly used varieties.
Photos: Dholakia Tobacco
Modern oral nicotine products could help Indian consumers abandon deadly local smokeless tobacco products.
By Stefanie Rossel
When it comes to tobacco, India holds several records: It is the world’s second-largest consumer, third-largest producer and fifth-largest exporter. Its consumption pattern is also remarkable. According to the 2016–2017 Global Adult Tobacco Survey, 266.8 million adult Indians—28.6 percent of the country’s population—use tobacco in some form.
However, with 199.4 million consumers, the most used tobacco product is smokeless (SLT). Only 99.5 million Indians consume tobacco by smoking it. Of these, only 37.5 million smoke cigarettes. Most smokers prefer bidis—cheap, unfiltered cigarettes made of tobacco flakes wrapped in a tendu or temburni leaf that are even more hazardous to health than factory-made cigarettes.
India has the world’s largest number of SLT users. Unfortunately, the type of SLT that prevails here does not reside on the low end of the risk continuum like other smokeless products such as Swedish snus do. A pasteurized oral tobacco with limited negative health effects, snus has helped Sweden achieve the world’s lowest smoking prevalence. Indian SLTs, by contrasts, are considered “uniquely deadly” by experts.
Indian SLTs come in a large variety. The most commonly used variants are khaini, a mixture of tobacco and lime, and gutkha, which comprises tobacco, slaked lime, paraffin wax as well as catechu, an extract of acacia trees and crushed areca (betel) nut. Other local forms of SLTs contain mixtures of betel quid or paan masala. All are highly addictive and full of carcinogens. In addition to the typical ingredients, they can be laced with thousands of chemicals. Available for a few rupees, these SLTs are affordable for low-income groups. Like bidis, they are predominantly consumed in rural areas, where almost 70 percent of the country’s population lives. SLTs are responsible for an estimated 350,000 premature deaths annually in India.
In line with its national health policy, India aims to reduce the number of tobacco users by 30 percent by 2025. The country closely adheres to the World Health Organization’s abolitionist guidelines, but its tobacco control measures are often contradictory. Attempts to curb tobacco use have remained limited to tax hikes on cigarettes rather than bidis and a ban on e-cigarettes and heated-tobacco products. In 2012, all states banned the manufacture, sale and distribution—but not the public use—of pre-packaged gutkha under laws that defined the product as a food. Some states extended this ban to other oral tobacco products, such as paan masala. Enforcement of these bans has been weak, however.
In an interview with The Free Press Journal, Kiran Melkote of AHER, a harm reduction group, outlined the reasons for India’s ineffective tobacco control policy. “Many arms of the government work at cross purposes and implement policies that even on paper are in direct conflict with the WHO Framework Convention on Tobacco Control. The health ministry tries to implement awareness campaigns and maintain zero industry contact norms for its employees while the commerce ministry provides loans and support for tobacco cultivation and the finance ministry bans e-cigarettes and incentivizes bidi manufacturers. All of them generally ignore oral tobacco. The answer therefore lies in understanding that the strategies used in the developed world where the predominant form of tobacco is the cigarette may not really impact tobacco use in India. Here we have a larger population with different problems and an admitted inability to implement existing laws.”
The success of modern oral products in Pakistan is welcome proof that they can replace the deadlier local oral tobacco.
Potential Solution
Perhaps a look across the border might be useful. India’s neighbor Pakistan has a tobacco consumption profile similar to that of India. An estimated 10 million people use SLT, which represents more than 40 percent of the country’s total tobacco market. Recently, Pakistan has seen a remarkable development: In December, BAT announced that its modern oral nicotine brand Velo had achieved a monthly volume of more than 40 million pouches in the country, making it BAT’s third-largest market for nicotine pouches. Modern oral nicotine products consist of pre-portioned bags comprising nicotine applied to a carrier material. They are considered to be a more advanced, cleaner version of Swedish snus.
Could Pakistan’s experience in substituting hazardous SLT products with less harmful varieties serve as a blueprint for India? “The tobacco use patterns in both nations are similar,” says Samrat Chowdhery, director of the Council for Harm Reduced Alternatives, referring to the high share of oral tobacco use. “Nicotine pouches have not been sold on scale before in the South Asian region, hence their substitution potential for the region’s tobacco users, especially the SLT users, was not known. Their success in Pakistan is welcome proof that they can replace the deadlier local oral tobacco—though whether that is indeed happening needs to be better understood.”
Nihar Dholakia, director of next-generation products at Dholakia Tobacco, an SLT company based in Gujarat, India, has been closely monitoring the rise of the modern oral category in Pakistan. “Given that both Pakistan and India have a similar culture of using SLT products, we believe that the success of nicotine pouches in Pakistan could be replicated in India but on a much larger scale.”
In light of the Indian government’s abolitionist strategy and the competitive structure of the local SLT segment, in which two leading companies jointly hold around 40 percent of the market, less hazardous oral products in India could encounter major hurdles, according to Chowdhery. “Nicotine pouches and snus could face opposition from the SLT lobby unless they can be made to see the business potential,” he says. “It would be a major setback if the government banned safer oral nicotine products too.”
Issues are also likely to come up in terms of cultural heritage and consumer education. “Tobacco use, especially oral, has long been part of India’s cultural milieu, just like alcohol is in western nations,” says Chowdhery. “SLT is also available for cheap, and varieties vary across regions. While the social stigma around smoking is beginning to develop, none exists for oral products as there is no secondary harm. Educating users can be challenging given the number of users, with different cultural norms and languages such that it is difficult to design communications.”
“In India, the avenues available for broadly educating consumers about THR and more specifically finessing that message to SLT users may be very limited,” says Dholakia. “The process seems to be largely organic, with consumers themselves becoming aware of the harmful effects and seeking alternatives. This often involved researching THR and exploring a range of reduced-risk products available. Online resources and word of mouth play a significant role in the education process. However, to make a more substantial impact, we require greater consumer advocacy as well as government initiatives to generally raise awareness.”
We believe that the success of nicotine pouches in Pakistan could be replicated in India—but on a much larger scale.
Treading New Paths
Despite the government’s reluctance to admit safer substitutes, not all is lost for THR in India. Dholakia and other manufacturers are beginning to look at snus and nicotine pouches. With the Paz brand, his business recently launched the first Swedish-style tobacco snus brands in India. “In fact, we operate India’s first online platform for snus,” says Dholakia. “However, we face regulatory challenges, such as the requirements of an 85 percent pictorial warning of product packaging, high taxes and restrictions on advertisement and promotion. Nevertheless, despite these obstacles, we have observed a growing trend among consumers who are actively seeking reduced-risk products as a better alternative.”
Dholakia Tobacco caters primarily to the premium SLT category. “However, considering the fact that India has over 220 million smokeless tobacco users who lack access to harm-reduced alternatives, we aspire to make our products more accessible and available to any SLT user. Therefore, we are determined to expand our reach to a broader audience in the domestic market as well through the right forms of direct-to-consumer education and word-of-mouth product awareness.”
Indian consumers have responded positively to Dholakia’s snus products, particularly after switching from traditional chewing tobacco, cigarettes or khaini. “Many customers have reported experiencing a positive change firsthand, indicating their acceptance and awareness of the harm-reduced properties of snus products,” says Dholakia. “These are some of our future ambassadors for risk-reduced products, who will quite naturally be out there to talk with other consumers about their experiences with these new products.”
The company also manufactures a filtered khaini brand, which has become popular in many Indian states recently. Filtered khaini is a modern version of khaini chewing tobacco that resembles western-style, portion pouch-packed snus but has a significantly different toxicological profile. “Traditional filter khaini available on the market is not less harmful than regular khaini,” clarifies Dholakia. “In fact, it can be thought of as a pulverized moist version of khaini packed in an oral pouch.”
Dholakia’s filtered khaini brand is not the same, he insists. “The filter tobacco products we offer are different in composition when compared to traditional filter khaini and commercially available products in India currently. It can be said it is less harmful than other filter products due to the use of low-impact base ingredients, the type of quality tobacco and the novel processes as well as our advanced approach to product integrity and testing infrastructure. As far as affordability and availability is concerned, these filter products are comparable to regular chewing tobacco and khaini products. They are available in a few states and are perceived by khaini consumers as a more sophisticated version of a mainstay khaini product.”
Dholakia Tobacco has also ventured into modern oral nicotine pouches. It was the first company in India to venture into this category. “As pioneers of modern oral nicotine pouches from India, our products are currently available only in the global markets we cater to and have not yet been launched domestically,” Dholakia says.
“However, we are considering and working toward introducing them in India as we firmly believe that they can have a positive impact on public health in the country. We are confident that Indian consumers are ready for such a product. Accessibility, awareness, the right information, a fair regulatory framework and quality control are key factors that need to be addressed for the category. Given that India is in dire need of multiple harm-reduced products, we are committed to making them available in India.”
Stefanie Rossel is Tobacco Reporter’s editorial contributor. An experienced trade journalist, she combines sharp reporting skills with in-depth knowledge of the tobacco and vapor industries. Prior to joining Tobacco Reporter, Stefanie was editor-in-chief at Tobacco Journal International, where she worked for a decade. Fluent in English, German and French, Stefanie covers tobacco news around the world. She is based in Germany.
Tobacco harm reduction initiatives should also cover e-waste management, say experts.
Contributed
E-waste is an emerging unintended environmental consequence of the revolution in electronic nicotine-delivery systems, threatening to undermine a technological innovation in public health. This conversation examines the intersection of regulatory policy, consumer behavior and the vaping products’ industry and hopes to map a sustainable path for the future.
In the discussion below, John Dunne from the U.K. Vaping Industry Association (UKVIA) brings in the vaping industry perspective, Pieter Vorster brings expert views on global tobacco and nicotine industry transformation, and Sudhanshu Patwardhan (Sud), a nicotine expert and health-tech entrepreneur, proposes a broader definition and scope of tobacco harm reduction (THR).
Sudhanshu Patwardhan
Patwardhan: We know that in the U.K. and the European Union, where they are regulated, vapes, or e-cigarettes, are classed as waste electrical and electronic equipment (WEEE). Ideally, consumers in these countries should dispose of vapes at a household recycling center or at the shop where they bought the device. Manufacturers are also required to make recycling options available. Many consumers, however, are unaware that single-use vapes can or should be recycled. Incorrect disposal of these items can potentially release plastic, electronic and hazardous chemical waste into the environment and represent a fire hazard. How big is this issue currently? Does the industry have numbers contrasting sales to recycling?
Dunne: In the U.K., around 459 million e-cigarettes of all kinds are purchased each year, of which 168 million, or 37 percent, are single-use vapes. Approximately 43 percent of all vapes purchased are recycled, although this number is likely much lower for single-use (“disposable”) products:
Twenty-three percent of e-cigarettes are recycled in-store when consumers buy a new one.
Twenty percent are recycled at a local authority recycling center.
On the face of it, the 43 percent recycled figure for e-cigarettes compares favorably with the 31.2 percent of waste electrical and electronic equipment in the U.K. that was recycled or reused in the U.K. in 2021. However, vaping products’ relatively short lifespan means more waste is generated.
Patwardhan: Good to get that broader electronic products-based perspective and the product use life cycle nuance with regards to e-cigarettes. Obviously, there is a still a gap between current practices by consumers versus what would make e-cigarettes environmentally sustainable in the long run. Pieter, do you think there are any good examples of industry players showing some leadership in this?
Vorster: All three tobacco companies that sell single-use vaping products in the U.K.—BAT (Vuse Bar), Imperial (Blu bar) and PMI (VEEBA), for example—advise consumers not to put them in household waste and offer free returns services on their websites. This information is displayed on the webpages where these items are sold. Consumers who don’t buy these products online need to read the package insert. They are advised that the product should not be placed in household waste but collected separately for recovery and recycling. The package insert also directs users to the manufacturer’s website for details of its recycling program. Whether consumers ever read these inserts is open to debate!
Independent U.K. brands are not far behind either; Riot Bar and Blo Bar have also introduced comprehensive recycling schemes. Blo also offers consumers one free Blo Bar for every 10 disposable vapes of any brand sent to them for recycling. Most online retailers in the U.K. offer disposal and recycling advice, and VPZ, the U.K.’s largest vaping retailer, has announced that it is introducing a comprehensive return and recycling program in its stores before the end of March.
Patwardhan: It sounds like manufacturers are, in theory, offering the recycling option to consumers. Do we know if consumers know that these options exist? Perhaps there is an education piece that needs to be carried out by key actors in the supply chain, including manufacturers, as well as by the broader regulatory agencies? Do the regulators need to intervene, or does the industry need to act? Or both, and others?
John Dunne
Dunne: Recycling vapes is not straightforward and needs collaboration between adult vapers, retailers, manufacturers, regulators and companies in the waste management sector, which are involved in the current Producer Compliance Schemes under the WEEE regulations. We are liaising with DEFRA [U.K. Department for Environment Food and Rural Affairs] and the Office for Product Safety and Standards and calling upon our members and the wider industry to innovate products that are easier to recycle.
Patwardhan: Talking about multi-stakeholder initiatives, we are on the cusp of another VApril, an annual British feature in April to showcase vaping as a means to stop smoking. As we have seen with a series of successive publications from U.K. health and related authorities and charities—e.g., the 2016 Royal College of Physicians’ Nicotine Without Smoke report—e-cigarettes/vapes are a potential force for good by helping smokers quit smoking. The THR creds of e-cigarettes in the context of current adult smokers are not in doubt. However, this emerging narrative on environmental harms from disposable vapes presents a unique challenge to those in public health and policy, does it not, Pieter?
Pieter Vorster
Vorster: Indeed, Sud. To date, opponents of tobacco harm reduction have often relied on questionable science that is unlikely to withstand rigorous evaluation, as evidenced by numerous retractions in recent years. On the other hand, the science underlying the potential environmental and health risks posed by the inappropriate disposal of reduced-risk products isn’t subject to the same constraints. Furthermore, the emotional appeal for the “environmental harms” narrative from these products has a much broader and vocal activist constituency—thus threatening to undermine the public health arguments of THR. In short, it represents a potentially potent weaponizable tool for those opposed to THR.
Patwardhan: I can see that the recent developments in Scotland, where an environmental activist highlighted the problem of vape littering, and separately, the decision of a large British supermarket chain to stop selling disposable vapes, signal a change in public perception and attitudes toward the product. It is as if an argument is being built in this narrative about disposables being harmful to the environment and are a lost cause as such, as well as the anecdotal observation that disposables are used by a much younger cohort, possibly those underage as well as those who have never smoked cigarettes before. If true, surely that is one issue to address through stronger regulations, especially with regards to preventing youth access and mandatory recycling requirements and refund schemes, right?
Dunne: Preventing the sale of vaping products to minors is one of the industry’s most fundamental challenges, and our members are united behind this goal. We have recently updated our “Preventing Underage Sales Guide” to give retailers all the information they need so they don’t inadvertently sell to someone under 18. However, we need the support of the government, regulators and enforcement authorities to ensure that unscrupulous retailers who knowingly sell to young people face the full force of the law. We believe that there is a need for increased fines for rogue traders, licensing of vape retailers and a national test purchase scheme. In fact, the UKVIA’s Youth Access Prevention Task Force will propose so to regulators this month. Regarding e-waste, the industry also recognizes its environmental responsibilities, and we are working with regulators, waste management experts, product manufacturers and retailers to find a workable solution.
Patwardhan: This is a most fascinating discussion where we find innovative 21st century nicotine products that have huge positive public health potential getting caught into an orthogonal field of great import in global public policy: sustainability and environment. In concert, responsible behavior by industry and retailers, better regulation and enforcement—and not prohibition—and consumer adoption of e-waste management solutions may well be the answer. In fact, we can go one step further and challenge all stakeholders—industry, regulators, public health and consumers—to embrace proactive e-waste management as another opportunity to reduce harms from a transforming tobacco and nicotine products’ landscape whilst maximizing the societal benefits from this shift in consumer behaviors.
Resource management company Veolia has launched a national vape collection service to help provide safe disposal and recycling routes for the 3 million vapes currently thrown away in the U.K. each week.
Veolia states that it can now facilitate the collection and transport of vaping products from retailers to a recycling facility to extract the valuable materials, including lithium, cobalt, nickel and manganese, inside.
The recycling of these items could save more than 10 tons of lithium that could be recycled into new products from the batteries, which would save up to 72 tons of carbon emissions compared to using raw materials as producing 1 ton of lithium from ore produces around 9 tons of carbon dioxide emissions, according to Scottish Local Retailer.
Collections will be scheduled according to demand, and in order to store and transport these materials safely, Veolia will provide retailers with individual containers of vermiculite, a mineral that will minimize fire risks from the lithium-ion batteries contained within the vapes.
“Two vapes are thrown away every second. They might be called disposable, but they can and should be recycled,” said Donald Macphail, chief operating officer of treatment at Veolia U.K. “Our new nationwide vape collection service will provide a safe recycling avenue to retailers who provide the mandatory takeback schemes for vapes and ensure that we can extract the valuable materials contained within and mitigate any fire and environmental risks.”
The government watchdog group Protect the Public’s Trust filed a complaint with the Department of Health and Human Services over what it says are scientific integrity violations involving the impact of vaping.
The complaint states that the U.S. Food and Drug Administration is promoting public health messages on vaping that appear to be unsupported by its own research and scientific findings, according to Center Square.
Protect the Public’s Trust stated that the FDA was making “scientifically unfounded statements about the vaping industry” contrary to its own research, adding that the agency’s own data appeared to contradict the FDA’s public stance on vaping products.
Protect the Public’s Trust said an FDA report found that “only a subset” of the many harmful compounds found in cigarettes are found in vapes and “at much lower levels” than those in cigarette smoke. That FDA report found that menthol vapes were helping adult smokers quit cigarettes better than fruit flavors, candy flavors or traditional tobacco flavors.
In the complaint, Protect the Public’s Trust stated that former FDA Commissioner Scott Gottlieb presented vaping as comparable to smoking traditional cigarettes because “several of the dangerous chemicals in tobacco smoke are also present in the aerosol of some [vaping] products.”
But the FDA declared that “Vaping is not harmless. It carries real health and safety risks, including addiction and other negative health effects.”
“Many studies suggest e-cigarettes and noncombustible tobacco products may be less harmful than combustible cigarettes. However, there is not yet enough evidence to support claims that e-cigarettes and other ENDS [electronic nicotine-delivery systems] are effective tools for quitting smoking,” the FDA stated on its website.
Protect the Public’s Trust stated that there has been a pattern of the government not following “the science.” Protect the Public’s Trust also claimed in December 2022 that the Centers for Disease Control and Prevention failed to track side effects of taking the Covid-19 vaccine.
“Once again, it appears that federal public health leadership has chosen to sacrifice scientific integrity and the public’s rapidly disappearing trust on the altar of political and special interest agendas,” said Michael Chamberlain, director of Protect the Public’s Trust, in an email to The Center Square. “While we were promised that health officials would follow the science, what we have observed instead is a disturbing trend of ignoring or disregarding scientific research and data that don’t fit their particular biases.”
The Philippines government is set to remove 15,000 more noncompliant electronic cigarette sellers in online marketplaces, reports The Philippine Star.
“We have monitored almost 15,000 sellers online,” said Ruth Castelo, trade undersecretary. “We’ve advised platforms to remove almost 15,000 we observed that were noncompliant. These sellers all have cases already.”
Unregistered vapor products are subject to the Vape Law, which came into effect Dec. 28, 2022, and prohibits flavors, colorful caricatures on packaging and selling products within 100 meters of schools, among other restrictions.
“If online platforms would just strictly follow, there is no need to remove the sale of this product from them,” said Castelo. “It’s already indicated which products they can’t sell, but some still evade detection.”
The newly initiated shisha tobacco marketing season in Zimbabwe has been successful so far, with farmers selling 263 bales worth $97.9 million at an average price of $4.40 per kg and the highest price at $5.40 per kg, reports The Herald.
Some farmers have expressed that they will increase their hectarage next season based on the positive sales so far this season.
“I recommend farmers to grow this type of tobacco; no curing using firewood,” said Victor Mariranyika, president of the Tobacco Farmers Union Trust. “Hence it is cheap to cure. Farmers need to maximize production since air is the major source of the drying energy. Shisha tobacco production is a welcome development.”
Special handling of shisha tobacco is required, however. “The tobacco needs very special attention because the plant or the leaf is very thin, so if you don’t carefully handle it, the leaf itself breaks,” said Jayson Scott, a Marondera farmer. “I have delivered 15 bales, and if everything goes well, I will increase hectarage.”
The Tobacco Industry and Marketing Board (TIMB) has licensed Cavendish Lloyd Tobacco to support shisha production in the country.
This season has been a chance to learn and develop a better shisha crop, according to Chelesani Tsarwe, a TIMB public affairs officer. Tsarwe said the target is to expand shisha production in slow-growing areas and to encourage more growers to produce shisha as it presents better opportunities.
“Desirable shisha tobacco should have a clean leaf, but the produce from fast-growing regions tends to have spots,” Tsarwe said. “Growers in these areas should take agronomic advice seriously in order to improve leaf quality and fetch better prices. Good agronomic practices are key to quality and better productivity.”
Filtered cigarettes are equally as unhealthy as unfiltered cigarettes, a Superior Health Council analysis showed, according to The Brussels Times.
The analysis also stated that filters cause a false sense of security and can cause more carcinogenic substances in cigarette smoke.
“Filters in cigarettes do not actually reduce the harmful health effects of smoking. From a public health perspective, they do not offer any benefit while they pollute the environment,” said the report by the Superior Health Council.
Banning filters could make smoking less attractive as well, as filters are said to have a more “pleasant” mouthfeel, reduce sensory irritation in the airways and prevent tobacco from entering the mouth.
“Instead of protecting against lung cancer, the filters have mainly promoted a shift in lung cancer type over the years,” the Superior Health Council concluded, adding that filters are therefore a “false solution” to the health problem caused by smoking.
The Superior Health Council is asking that filters be considered nondegradable single-use plastic products like disposable plastic bags. The council is also suggesting that a filter ban be implemented across the European Union to give it the best chance of success.
