Blog - Tobacco Reporter

Illegal Cigarette Factory Dismantled in Slovenia

French and Slovenian authorities have dismantled a cigarette factory in Slovenia that was supplying millions of counterfeit cigarettes to France, according to Europol.

Initiated in October 2020, the investigation focused on an organized crime group involved in the illicit production and distribution of cigarettes. After two successful actions in France in April and May 2021 targeting the criminals involved in the distribution of these counterfeit cigarettes, the Slovenian authorities started a mirror investigation aimed at arresting the suspects responsible for the production of these illegal products.

On Jan. 25, more than 100 officers from the Slovenian National Police Force and Financial Administration simultaneously raided 11 sites, including industrial premises and private residences. They were assisted in the field by officers from the French Gendarmerie as well as French magistrates from the Bordeaux Interregional Specialized Court and Europol officers.

This action uncovered several production sites established in warehouses located in remote areas of Slovenia. In total, more than 26 tons of tobacco were seized in Slovenia as well as 29 million filters, several cigarette-making machines and 10 tons of printed papers for packaging. The seized equipment was capable of producing cigarettes with a value of €13 million on the French market.

Leaders of the criminal network were arrested in Croatia and Slovenia. They will be handed over to the judicial authorities in Bordeaux.

In November 2021, the Slovenian Financial Administration seized an additional 12 tons of cut tobacco.

January 29, 2022

FDA Looking for New CTP Director

The U.S. Food and Drug Administration is now accepting applications for the position of director of the Center for Tobacco Products (CTP). The current director, Mitch Zeller, plans to retire in April.

The CTP director is responsible for planning, managing, directing and coordinating major tobacco program objectives to implement the Tobacco Control Act and related regulations.

This senior-level FDA position advises the FDA commissioner, senior FDA officials and others on all matters involving tobacco product regulation that have an impact on policy development and execution and long-range program goals. The director develops and executes the strategies for compliance outreach, enforcement, regulations and guidance formulation, science-based application review and other product regulation activities.

The individual selected for this position will represent the agency and establish/maintain relationships in meetings and conferences with top level FDA and Health and Human Services officials, national industry representatives, members of Congress, and counterparts from federal, state, local and foreign governments.

Candidates must complete their applications by 11:59 p.m. on Feb. 25, 2022.

January 29, 2022

New Technology to Help Reduce Dependency

VapeAway has developed a technology designed to help reduce vaping dependency. According to the company, the VapeAway filter attaches to an existing e-cigarette pod, automatically working to remove toxins found in e-cigarettes with minimal impact on the quality of the vaping experience.

The patented VapeAway filter is said to stop nicotine before it enters the body by gradually reducing nicotine intake in levels, beginning at 25 percent and increasing to a 75 percent reduction over the course of nine weeks, thus reprogramming the brain to decrease cravings and reduce dependency.

“Every e-cigarette, regardless of its type, flavor or contents, contains dangerous chemical toxins,” says Ike Sutton, the founder of VapeAway. “VapeAway offers the first patented filter that removes those toxins. Until now, those who were dependent on nicotine have been directed to nicotine patches or gum as their recovery solution, both of which use nicotine to satisfy cravings and with that comes a laundry list of warnings and side effects.

“VapeAway’s patented technology does the opposite and does not administer a drug to help people quit a drug. Our filters stop the nicotine directly at the source and reduce the intake of harmful chemicals while users continue to vape, all the while ultimately helping people quit in the long term if they choose to do so.”

VapeAway says its Vapor Freeze 2.0 technology consists of a proprietary blend of military grade, nontoxic fibers that freeze potentially harmful toxic chemicals on contact, protecting vapers and others around them from unwanted chemicals and toxins entering their lungs.

The technology has been tested to ensure it meets VapeAway’s stated use cases and it effectively and consistently performs to achieve the stated impact for its users. Preliminary tests were conducted by Enthalpy Laboratories.

According to SGS North America, the VapeAway filter is 100 percent nontoxic.

January 29, 2022

UKVIA Anticipates Busy Year for Vaping

The U.K. Vaping Industry Association (UKVIA) anticipates a busy year for the sector, the industry group noted at the publication of its 2021 annual report.

Among other activities, the association looks forward to launching its first Economic Impact Report, which will be used to highlight the vaping industry’s significant contribution to the British economy and support engagement with policymakers and the media.

The UKVIA also plans to roll out of a levelling-up campaign designed to achieve recognition for the important role that vaping plays in reducing health inequalities across the U.K.

In addition, the group intends to build on the launch this year of the UKVIA’s healthcare campaign, which has included the development of a dedicated online advice hub for healthcare professionals and patients with smoking conditions.

This year will also witness the conclusion of the review of the U.K. Tobacco and Related Products Regulations, which will shape the future of the industry for years to come, according to the UKVIA.

Coinciding with the UKVIA’s annual vaping industry forum, planned for June 2022, the group is planning a new awards event to recognize the high standards within the industry.

January 29, 2022

Cerulean Debuts Snus Test Station

Cerulean has launched Orion, the world’s first automated test station for snus.

The Orion can handle oral pouches of all commercially available size formats, including mini, large, maxi and slim.

The instrument measures pouch weight, length, width, end seam width, longitudinal seam overlap width and pouch tensile strength. According to Cerulean, the Orion requires only a few minutes to configure and perform the test. The instrument is equipped with an intuitive user interface that provides key information, graphical representation of process capability and stores the data in a network accessible SQL database. A powerful vision system takes images of both sides of every pouch that are used to measure the pouch dimensions, seams width and longitudinal seam position.

The Orion test station reduces the number of operators per line and provides fast, consistent and repeatable users’ independent testing process with real time visualization of the test results, configurable report generators and readily available connectivity to LIMS and MES systems.

According to Cerulean, the Orion saves operator time and improves quality through independent, fast, consistent and repeatable testing of pouches. With a real time visualization of test results and configurable report generation, the Cerulean test station guarantees that the production process is always in control.

January 29, 2022

Lil Inducted Into Korea Brand Hall of Fame

KT&G’s Lil heat-not-burn device has been named as an excellent e-cigarette brand in the Korea Brand Hall of Fame for the fourth consecutive year.

Supervised by South Korea’s Industrial Policy Research Institute, the Korea Brand Hall of Fame is an annual award event that selects the brands most loved by consumers.

Launched in 2017, Lil has been well received by the consumers, who bought more than 1 million units in the first year.

After this initial success, KT&G released line extensions, such as Lil Plus, Lil Mini, Lil Hybrid and Lil Solid. By 2021, the cumulative sales of Lil exceeded 4 million units in Korea alone.

Lil performed well internationally too. In January 2020, KT&G signed a supply contract with Philip Morris International for overseas marketing and sales of Lil, which subsequently secured a bridgehead for expansion in the global cigarette market.

KT&G started selling Lil in Russia, Ukraine and Japan in 2020 followed by product launches in Central Asia and Europe. In November 2021, KT&G launched Lil in Guatemala. Today, KT&G exports Lil to 23 counties.

“We built the brand Lil on the identity of ‘practical minimalism’ together with systematic technological innovation,” said Lim Wang-seop, head of KT&G’s next-generation product business unit, in a statement. “We’ll make the brand recognized by the world consumers through developing the products that meet their needs and tastes.”

January 29, 2022

Promotions at Keller and Heckman

Keller and Heckman, a law firm specializing in the tobacco and vaping industries, has promoted Neelam Gill to counsel and Eric Gu to senior regulatory counselor.

A resident in the firm’s Washington, D.C., office, Gill practices in the area of food and drug law and tobacco and e-vapor law. In her tobacco and e-vapor practice, she advises tobacco, e-cigarette and e-liquid manufacturers, distributors, retailers, suppliers and trade associations on FDA, state and global regulatory compliance issues.

In the food and drug arena, she assists clients with a variety of FDA regulatory matters and labeling issues. Gill advises clients on preparation of FDA submissions, including premarket tobacco product applications, substantial equivalence reports, tobacco product master files and quality issues pertaining to the entire tobacco and nicotine product lifecycle.

A resident in Keller & Heckman’s Shanghai office, Gu practices in the area of food and food packaging law. He counsels clients on food labeling, food ingredients and food packaging compliance matters. In addition, he counsels clients on regulatory issues with respect to other products, including cosmetics, drug/drug excipients, tobacco and e-cigarettes and other consumer products.

Gu frequently assists clients in obtaining important premarket approvals and permits, including approvals of new food packaging substances, the food production license and the drug excipient registration. Gu’s regulatory experience extends to China, Hong Kong, Taiwan, Japan, Southeast Asia, the European Union and the United States.

January 29, 2022

First Vapor Industry Trade Show of 2022 Opens in Vegas

The first industry trade show of the year opened its doors yesterday in Las Vegas. The Tobacco Plus Expo (TPE) runs from Jan. 26-28 and brings together representatives from several segments of the vapor, tobacco and alternative product industries. The number of exhibitors this year increased significantly compared to last year’s show, which was held in May after being postponed for four months, rising to 425 exhibitors compared to 350 in 2021.

Attendance for the first day of the show was an estimated 4,000 visitors, according to a TPE representative. That’s a nearly 30 percent increase from opening day for last year’s event which drew an estimated 2,500 to 3,000 visitors. The show didn’t “feel” like there were that many attendees, however, it’s such a large floorplan it would be impossible to guess an estimate.

There was a noticeable reduction in the number of nicotine vaping companies showing on the floor. The impact of premarket tobacco product applications (PMTAs) and PACT Act regulation was evident. There were only an estimated 12–14 e-liquid vendors, including Coastal Clouds, BLVK E-liquid, Bantam, Pacha Mama and Ripe Vapes. There were eight to 10 hardware manufacturers, including Mi-One Brands, Myle, First Union and Vaporesso, and most of the manufacturers produced their own brands.

There were also a few e-liquid brands selling products that have already received a marketing denial order (MDO) from the FDA. One company told Vapor Voice that there really isn’t much enforcement and getting warning letters is the only thing that has happened to them.

There were, however, a very large number of disposable synthetic nicotine brands. One new brand at the show, Hook’d – with its tagline “one puff and you’re Hook’d” – seemed to take taunting the U.S. Food and Drug Administration to another level according to Kim, a show attendee who asked not to use her last name. “Why would you put a brand out there like that,” she said. “It’s just disappointing.” A person working the Hook’d booth, when asked why the Hook’d name, told Vapor Voice the name was “just catchy.”

Next year’s TPE is scheduled to take place Feb. 22-24, 2023. While most likely not an issue for vapor and alternative industry representatives, the TPE’s cigar segment may find itself split in several directions. Not only is that week traditionally when Procigar, the Dominican Republic’s cigar festival, takes place, it also may be competing against the Festival del Habano—Cuba’s cigar festival— that typically takes place in late February (traditionally the week after Procigar).

In 2019, both festivals took place during the same week and were scheduled to take place the same week in 2022 before the Habanos festival was cancelled due to Covid concerns. Neither Procigar nor the Festival del Habano has announced dates for 2023.

January 27, 2022

Altria Group Reports Full-Year Results

Altria Group earned net revenues of $26.01 billion in 2021, down 0.5 percent from its 2020 net revenues. Net revenues net of excise taxes was up 1.3 percent to $21.11 billion in 2021. For the fourth quarter of 2021, Altria Group reported net revenues of $6.26 billion, down 0.8 percent over those reported in the comparable 2020 period. Revenues net of excise taxes were up 0.6 percent to $5.09 billion for the fourth quarter.

“Altria delivered outstanding results in 2021 across our businesses, including strong financial performance, progress toward our vision and advancements in our ESG efforts,” said Altria CEO Billy Gifford in a statement.

“We returned more than $8.1 billion in cash to shareholders in 2021 through dividends and share repurchases. This total represents the third-largest single-year cash return in Altria’s history and the largest annual return since 2002.

“Our plans for the year ahead include a continuation of our strategy to balance earnings growth and shareholder returns with investments toward our vision. We expect to deliver 2022 full-year adjusted diluted EPS in a range of $4.79 to $4.93, representing a growth rate of 4 percent to 7 percent from an adjusted diluted EPS base of $4.61 in 2021.”

Altria’s heated-tobacco business suffered a setback when the U.S. International Trade Commission imposed an importation ban on the IQOS device, Marlboro HeatSticks and infringing components following an intellectual property dispute with Reynolds American Inc. As a result, the IQOS system is no longer available for sale in the U.S.

Atria says it remains focused on returning IQOS to the U.S. market.

January 27, 2022

PMI Included in 2022 Gender Equality Index

Philip Morris International has been included in the 2022 Bloomberg Gender Equality Index (GEI) for the second year running. This is in recognition of the progress PMI has made in increasing gender equality globally. Currently, 39.2 percent of management positions are held by women, an increase of more than 10 percent since 2014 and still growing.

“I am delighted that PMI has made the GEI for the second year running, particularly given that the threshold for inclusion within this index has grown since last year,” said Silke Muenster, chief diversity officer at PMI, in a statement. “While we still have a long way to go, I am very proud of the progress we have made to date, and I am confident about achieving more in the future.”

As part of PMI’s commitment to gender parity, a global company-wide target was set to improve gender balance to at least 40 percent female representation in management by the end of 2022 and measuring and reporting progress against it.

Other achievements and initiatives to further gender equality by PMI have included: becoming the first EQUAL-SALARY globally certified company; addressing gender bias in talent assessments; introducing global inclusive parental leave guidelines; celebrating top female talent; and launching a women in leadership program.

The GEI is a modified market capitalization-weighted index that aims to track the performance of public companies committed to transparency in gender data reporting. It measures gender equality across five pillars: female leadership and talent pipeline, equal pay and gender pay parity, inclusive culture, anti-sexual harassment policies, and pro-women brand.

“We are proud to recognize PMI and the other 417 companies included in the 2022 GEI for their commitment to transparency and setting a new standard in gender-related data reporting,” said Peter T. Grauer, chairman of Bloomberg and founding chairman of the U.S. 30 Percent Club. “Even though the threshold for inclusion in the GEI has risen, the member list continues to grow. This is a testament that more companies are working to improve upon their gender-related metrics, fostering more opportunity for diverse talent to succeed in their organizations.”

All companies included in this year’s index scored at or above a global threshold established by Bloomberg to reflect disclosure and the achievement or adoption of best-in-class statistics and policies.

January 26, 2022