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  • Hear, Hear!

    Hear, Hear!

    Photo: Bertie Watson

    Participants in the Forest Summer Lunch event lament the continuing assaults on personal choice and personal responsibility.

    By George Gay

    And … (slight pause for effect) … the Golden Nanny Award goes to … (rustling of envelope) … Javed Khan!

    Yes, during a ceremony that brought to a close the Forest Summer Lunch and Awards* at the Boisdale of Belgravia restaurant in London on July 5, Khan was recognized for his contribution to the nanny state. The event, which was co-hosted by Forest (Freedom Organization for the Right to Enjoy Tobacco, for the uninitiated) and Ranald Macdonald, managing director of Boisdale Restaurants, was attended by about 60 guests, who included friends of Forest, broadcasters, journalists, parliamentarians and think tank representatives.

    Khan, however, was not in attendance, though he had been invited, so the award, presented by Forest Director Simon Clark, was collected by the editor of the Nanny State Index, Christopher Snowdon, who, unfortunately, was unable to guarantee that it would reach its intended recipient.

    Khan’s absence was a pity because he had been a shoo-in for the award after the publication of his report, Making Smoking Obsolete, which was published June 9 as an independent review into the U.K. government’s smoke-free 2030 policies. The review had been commissioned by then Secretary of State for Health and Social Care Sajid Javid, apparently to help inform the government’s policies aimed at countering health inequalities within England, which are part of its “leveling up” agenda.

    A story on MedPage Today described the Khan review as providing “cutting-edge recommendations with the aim of achieving a ‘smoke-free 2030,’” but to my way of thinking, the review is confusing, blinkered, paternalistic and spiteful in its calls for the further degrading of cigarettes and their packaging and the further impoverishment of smokers. But perhaps worst of all, it is devoid of new ideas, so its general theme is to suggest the way forward through the inflation of the failed policies of the past.

    But perhaps none of this matters. Within three hours of Khan’s award being announced, though, I should emphasize, unconnected with the announcement, Sajid Javid resigned from the front bench in what was to become a government meltdown that, over a couple of days, saw the resignation of almost 60 ministers and culminated in that of the prime minister, Boris Johnson. The ruling Conservative Party is deeply divided, and what happens in respect of the review’s recommendations could well depend partly on who the party picks as its new leader and, therefore, the new prime minister. It should be pointed out, however, that it is unlikely the result of the leadership contest will provide good news for smokers—just varying degrees of bad news.

    Speaking during an after-lunch Q&A session conducted by Mark Littlewood, the director general of the Institute of Economic Affairs, Clark said he was opposed to targets such as the smoke-free 2030 goal. Forest had no problem with the falling smoking rates of the past 50 years. Society had changed, he said. People now knew about the health risks associated with smoking, and many were choosing to switch to products that were less risky than cigarettes. But Forest believed that decisions about quitting smoking should be made on the basis of choice and personal responsibility. It was against people being forced or coerced into giving up smoking, which was a possibility given that the “ludicrous” smoke-free 2030 target could not be achieved on a voluntary basis. If the Khan review was accepted, smokers were going to be coerced into quitting through a range of measures, including the extension of smoking bans from inside hospitality venues to outside those venues, and by pushing up taxes, which would force even more people into poverty.

    In addition, Clark expressed concern that even if the government achieved its target, those opposed to tobacco would not be satisfied. At the moment, many of them said that vaping was a good alternative to smoking, but their long-term goal was not smoke-free—it was tobacco-free and nicotine-free. “These people will never stop, and we have to stand up to them,” he said to loud applause from guests who listened to Clark throughout with respect, interspersed with whoops of delight and cries of “hear, hear!”

    Turning to what he described as Khan’s “so-called independent review,” Clark pointed out that the acknowledgements made in one of its appendices comprised a who’s who of tobacco control. Forest tried to engage with Khan during the review period, but it wasn’t clear whether he had even read its submission because the only response it received was a note saying that, under article 5.3 of the World Health Organization Framework Convention on Tobacco Control, he couldn’t engage with Forest. It was rather pathetic, Clark said, when somebody who was supposed to be conducting an independent review would not engage with representatives of an important stakeholder. Why would you conduct a review if you were not prepared to engage with that important group of people? Such a stance suggested that Khan had no interest in the views of the people who comprised this group, no interest in why they smoked or why they enjoyed smoking and no interest in why they didn’t want to quit.

    Khan, Clark said, had made about 14 recommendations, but it was interesting that, given that it was an independent review, he hadn’t come up with a single original idea. The ideas were all copied from New Zealand, Canada, the U.S. and elsewhere. And they included some bizarre ideas, such as changing the color of cigarettes to dirty green. This was an attempt to take cigarette sticks down the same path as cigarette packaging, which had been turned into “plain packaging.” There was no evidence that plain packaging had made any difference whatsoever to smoking rates, so the idea that smokers were going to give up simply because the color of their cigarettes had been changed was nonsense.

    Currently, cigarette packs carry huge warnings, so everybody is aware that there are serious health risks associated with smoking, but now Khan wants “smoking kills” written on the side of cigarettes. How far was this going to go? Clark mused. This latest review showed how desperate the anti-smoking lobby had become. “We’ve had enough education, we’ve had enough regulation, we’ve had enough legislation; just let it go,” he said.

    It would seem that the public, too, has had enough. Last week, said Clark, on the 15th anniversary of the smoking ban, Forest had carried out a poll in which it asked 2,000 people what the government’s priorities should be, and, of the 10 options given, the top three were tackling the rising cost of energy and gas, tackling rising inflation and improving the health service. Some of the issues that people thought the government should treat as moderately important were helping businesses recover from the impact of the pandemic, addressing care for the elderly and tackling the housing shortage. The topics that were deemed the least important were tackling smoking, tackling the misuse of alcohol, tackling obesity and tackling climate change.

    In fact, the previous paragraph should probably have opened with, “It would seem that the public, too, has for a long time had enough.” Clark said that Forest had been running annual polls for many years, and it had always turned out that people did not consider tackling smoking to be an important priority for this or any other government. “It was time governments started listening,” he said.

    Finally, Clark, who has been at Forest since 1999, was asked what the future held given that the percentage of British people who smoked had dropped from about 40 in 1979, when Forest was formed, to about 14 now. From the Forest point of view, he said, he wasn’t looking forward very far. He didn’t know where we were going to be in 15–25 years, though he believed there would still be a substantial number of people smoking.

    But Clark said that for him, Forest had never been just about smoking, a point that is hinted at in the first two words of the organization’s full name, Freedom Organization for the Right to Enjoy Tobacco, and that is underlined by the guestlists of Forest events, which comprise mostly people who can be described loosely as libertarians, some of whom are smokers. “It’s always been about personal choice and personal responsibility,” he said. “They are the principles that we have been fighting for, and those principles don’t age. And that is why I think there will always be a role for a group like Forest, even if it has to change its name in the future because there are so few actual tobacco smokers. It’s all about choice and personal responsibility, and we need to put those issues, those principles, higher up on the political agenda because in recent decades, politicians seem to have forgotten about them.”

    *Special presentations were made during the awards ceremony to Liz Barber and Pat Nurse, described as two Forest supporters who previously had remained unsung heroes.

    The first award of the afternoon went to the semi-retired Daily Mail columnist Tom Utley, who was painted as a smoker of heroic proportions and who was said to be described by Wikipedia as having made a career out of opposing wokery. Second up was Will Lloyd, the commissioning editor of Britain’s Unheard online magazine, who collected an award on behalf of David Hockney, described as arguably Britain’s greatest living artist and, despite the best efforts of Utley, unarguably its greatest smoker.

    Then, after Snowdon had stood in for Khan, a special award was made to Ranald Macdonald for his longstanding but hitherto officially unrecognized support of Forest, which, over the years, had included hosting numerous events at Boisdale venues.

  • All in the Paper

    All in the Paper

    Photo: RTI

    Republic Technologies strengthens its lead in the world of RYO and MYO.

    By Stefanie Rossel

    While a niche compared to the global combustible cigarette market, the roll-your-own products category continues to grow steadily. Trouve360 Reports valued the global RYO products market at $8.72 billion in 2021 and projects it to reach $10.67 billion by 2028, reflecting a compound annual growth rate of 2.9 percent. The Covid-19 pandemic has boosted the sector, according to Santiago Sanchez, executive president of Republic Technologies International (RTI), a leading supplier of smoking accessories probably best known for its JOB, Zig-Zag and OCB rolling paper brands. “Sales increased a lot in 2020–2021 due to the stocking situation and increasing demand,” he says. “Some retailers overstocked. Now we have a kind of stabilization, which started early this year for our company. Sales have stabilized at a higher level than before Covid.”

    The RYO category also benefits from its unique position in the tobacco industry. “If you look at the U.K., for example, where vaping has become very popular, you will notice that the RYO market has not been shrinking because of people switching to vape products,” says Sanchez. “Whilst we have lost some customers to vaping, we have won new customers who have downtraded from highly taxed factory-made cigarettes.”

    Due to continuing tax increases for cigarettes, Sanchez expects more smokers to switch to more affordable RYO and make-your-own products. Production planning, however, has become more difficult for his company: “Currently, the situation is very dynamic due to inflation and the energy crisis following the Russian war against Ukraine and due to stockpiling; you don’t know what will happen tomorrow,” says Sanchez.

    RTI boasts the largest paper booklet factory in the world. It is located at the company’s headquarters in Perpignan in the south of France and has an output of 1.2 billion booklets annually.

    The company is also present in Barcelona, Spain, where it moved to a new, larger site last year. Here, RTI manufactures filter tubes for Spain, Portugal, France and Italy. With its two tube maker machines, the factory has a capacity of 4 billion tubes a year. With five filter maker machines, the plant also supplies 15 billion filters as a base for the tubes as well as for sale as bagged filters.

    With Austria-based Altesse, RTI has a third production facility in Europe that manufactures tubes and filters for Central Europe; Germany is the main market for tubes in Europe. Top Tubes in Montreal, Canada, supplies the North American market with filter tubes. A plant in North Carolina produces RYO and MYO products as well as pipe tobaccos for the United States, where the RTI operates under the name Republic Brands. Furthermore, five distribution companies in the U.S., Canada, France, the U.K. and Germany are affiliated with RTI.

    Controlled Process

    Santiago Sanchez

    The company sells to 110 countries worldwide and is vertically integrated. Most of the paper it processes is produced by its sister company Papeteries du Leman, which is associated with the privately held Republic Technologies Group. “From cigarette paper to the final product, everything comes from one company,” Sanchez emphasizes. “We also have close ties with the people growing the plants for the raw materials of our products, for example the farmers in Champagne who grow hemp for our hemp papers.”

    RTI has total control of the process, according to Sanchez. To help reduce greenhouse gases, the company tries to source its materials locally as much as possible. “Except for the Arabic gum that is imported from Africa and the bamboo that we source from China, all raw materials and machinery come from within 500 km of our Perpignan site,” says Sanchez.

    Operating in a comparatively small segment of the tobacco industry, RTI does not have available as vast of an array of ready-made manufacturing equipment as the large cigarette companies do. Instead, the smoking accessories supplier has an R&D department with a team of engineers and technicians who design all machinery, which is then custom built. Maximized automation and flexibility are key requirements of the equipment as RTI produces many different paper specifications based not only on cellulose but also on textile fibers such as hemp, flax, bamboo and rice. Traceability is another consideration. Each bobbin is marked with a matrix code so that the paper can be traced back to the machine and even the canal on which it was manufactured. As one measure to protect its products from being counterfeited, RTI embosses its papers with watermarks.

    Counterfeiting is a big issue in the RYO category, according to Sanchez, who observes this threat especially for RTI’s OCB brand, with fakes coming mostly from China. The company says it relentlessly pursues counterfeiters. In March this year, it won a significant legal victory in the U.S. when a jury found that a Georgia-based wholesaler had willfully sold and distributed counterfeit rolling paper products under Republic Brands’ TOP and JOB trademarks. Republic Brands and its affiliates were awarded $11 million in damages from the counterfeiting wholesaler and its owner.

    R&D is Key

    At its headquarters, RTI has a dedicated laboratory that checks the ingredients and raw materials of the company’s products for regulatory compliance. It also analyzes competitors’ products and fake versions of its own trademarks. The lab is equipped to measure all paper characteristics, such as opacity, tensile strength, porosity or thickness.

    R&D is a must for RTI because of legislation, the move toward more environmentally friendly production and other factors, says Sanchez. “Regulation makes work highly complicated. Being delivered to 110 markets, our products have to comply with all the different regulations, health warnings and even plain packaging requirements, as is the case in Israel,” he says.

    RTI’s lab also provides vaping machines and related testing equipment. The company diversified into the vape category in 2014 and has since been selling e-liquids under the E-CG brand. In October 2020, the company acquired French liquid manufacturer Innovative – So Good to expand the scope of its business. Today, RTI is one of the leaders in the French vape market, where its liquids are exclusively sold through tobacconists. All liquids are created at the Perpignan site.

    One of the advantages of rolling papers is that they can be made with naturally occurring fibers and without calcium carbonate and citrate as combustion additives, as is the case with factory-made cigarettes.

    In June 2019, the EU Single-Use Plastics Directive entered into force. Since then, all tobacco products with filters and filters marketed for use in combination with tobacco products in the common market must carry a label that states that the products contain plastic.

    Presently, the RTI’s R&D team develops many products that are more environmentally friendly. RTI has launched a line of biodegradable filters that are made with paper. Touch and filter properties are virtually the same as those of cellulose acetate (CA) filters, explains Sanchez. “It’s the result of a two-year development,” he says. “Technically, it replicates CA. Tests have shown that smoking experience is the same, and from a physical point of view, pressure drop equals that in a CA filter. We are the only ones offering this kind of biodegradable filter for RYO. The paper is the key; it is made from cellulose and viscose. Only few paper manufacturers are capable of producing this.”

    RTI also markets its biodegradable filters in some of its tube products. Environmentally friendly filters today account for 20 percent of the company’s turnover from filters.

    New Base Materials

    Regarding rolling papers, the company has a wide range of products in its portfolio. RTI claims to be the only company selling cigarette papers that contain real rice fibers. “Rice fibers are quite fragile; they tend to break too often on high-speed machines,” says Sanchez. “So many manufacturers stopped making it. We developed a rice paper in 2021 with a mixed blend consisting of 50 percent rice and 50 percent hemp and adopted our manufacturing process to handle the product.” Rice paper is one of the original cigarette paper types; it burns more evenly and reportedly gives more of a natural taste, so many consumers still want it. The rice that RTI processes in its paper comes from the French Camargue region.

    In 2021, RTI also introduced Roor rolling papers with CBD-infused gum, which are distributed in markets where CBD is legal, such as the U.K. and Germany. “Due to Covid, the product has been launched only recently, but it’s doing particularly well in Germany. We also offer variants with rice, organic hemp and unbleached papers,” says Sanchez.

    OCB Bamboo is another newcomer from RTI. “We have developed a full range of bamboo papers, which we are now planning to sell worldwide,” Sanchez says. “OCB Bamboo has been a big success in the U.S. Bamboo is good for the environment; it grows fast and needs no fertilizers. We are trying to find an alternative source to China, for instance, in the Philippines.”

  • Tools Of The Trade

    Tools Of The Trade

    Photo: JTI

    At a summer event in London, JTI showcases some of the devices that may help England achieve its smoke-free ambitions.

    By George Gay

    In his U.K. government-commissioned review, “Making Smoking Obsolete” [in England], Javed Khan said he had seen no evidence of a plan by industry to move toward meeting the ultimatum “for industry to make smoking obsolete,” which was included in the government’s 2019 prevention green paper. I’m not certain what is meant by “industry” here, but assuming it means partly or exclusively the tobacco industry, and perhaps the nicotine industry, this statement seems extraordinary. After all, one of Khan’s reviews, “Critical Interventions,” recommends promoting as effective tools to encourage smokers to quit their habit some of the products that, for well over a decade, the tobacco and nicotine industries have been developing, making available and promoting insofar as they have been allowed to do so.

    The independent e-cigarette industry has arisen almost solely for the purpose of converting as many smokers to vapers as possible—to making smoking obsolete, if you like. That is its raison d’etre. Of course, a purist might complain that individual vaping industry firms also want to make a profit, but making a reasonable profit provides funding for new developments and, more generally, makes the world go round.

    So perhaps the government’s ultimatum was aimed only at the tobacco industry. But even in this case, it seems somewhat uncharitable not to give recognition to the enormous investments and efforts that have been made by tobacco companies in developing what I am comfortable calling lower risk products and, especially, in the scientific validation of their products’ lower risk credentials. And this is not to mention that, as far as I am aware, it was individual tobacco companies that first started to apply the concept of “harm reduction” to tobacco/nicotine consumption and that, in the U.K., first suggested setting a target date for ending smoking: 2027.

    If my memory serves me correctly, the emergence of the tobacco harm reduction principle predated the arrival of vaping products and was based on snus, a product that is without doubt one of the least risky tobacco products of all but one that, inexplicably, was and is banned in the U.K. and one that Khan believes should remain banned. And it is worth mentioning that the country might conceivably have been well on the way to meeting the 2027 target if the government had been more ambitious and reacted more positively in 2017, when the target was suggested, largely based on the use of heated-tobacco products (HTPs). Certainly, I think the U.K. would have been in a better place if e-cigarette companies had been allowed to advertise the consumption of their vaping products as being 95 percent less risky than the consumption of combustible cigarettes, a figure that, to its credit, the government had long accepted.

    Coincidentally, a range of U.K.-market, lower risk products was on display during Japan Tobacco International U.K.’s summer event held at the Mandarin Oriental Hotel in London on July 13, one of which was launched in 2019 and another of which was launched in 2020—so, in line with the government’s ultimatum, though not necessarily in response to it. There were three products in all—a vaping device, an HTP and a nicotine pouch—so, at the very least, JTI U.K. must be given credit for having made a huge effort, if not toward making smoking obsolete per se but toward providing as far as it can the tools and encouragement for smokers to switch to less harmful products. It is, after all, beyond the power of a single company to “make” smoking obsolete; only the government has the power to come close to doing that and, no doubt for good reasons, it has chosen not to do so.

    The summer event, dubbed “Innovating for Tomorrow,” was attended by about 300 people, including those representing trade and retail partners, community investment partners, agencies, think tanks and the media. About 20 politicians from across the political spectrum were also scheduled to attend, though whether they all tore themselves away from the Conservative Party’s leadership hustings in Westminster I don’t know. Given this attendance and an abundance of fine drinks and delicious food, it is not surprising that the evening was devoted, aside from two short speeches—by Charlie Cunningham-Reid, U.K. corporate affairs and communications vice president for JTI U.K., and Gemma Bateson, U.K. sales director—to relaxed discussions around and away from the product displays. On what was for England a hot day, the venue, with its two large, airy rooms and pleasant garden overlooking Hyde Park, lent itself to such discussions.

    One of the products on display was Logic Compact (more information on the products displayed is available at www.jti.com/europe/united-kingdom), a closed-tank e-cigarette that is used with pods of e-liquid available in a range of flavors. At the display stand for these products, much was made of the high level of testing that was carried out on the devices and e-liquids. And, interestingly, a figure from the Office of National Statistics that was on display had it that about 3.3 million people in the U.K. used e-cigarettes, which was something of a testament to the effort that had been made by the vaping and tobacco industries to deliver smoking obsolescence.

    The most recent JTI U.K. reduced-risk product to be made available on the U.K. market and that was on display at the summer event was Ploom, an HTP launched in 2020. Ploom is said to offer an authentic smokeless tobacco experience delivered through the action of an innovative heating technology that causes no combustion and no burning and therefore produces no smoke or tar. Consumers have already embraced e-cigarettes, and the government has largely accepted them, so JTI U.K. will be hoping to see the same level of acceptance for HTPs. These products are certainly likely to appeal to consumers on price, especially those used to paying around £9 ($10.77) for a pack of cigarettes. After an initial outlay of about £45 on a device, consumers pay about £4.50 for a pack of 20 EVO tobacco sticks, which come in a range of flavors and strengths.

    Meanwhile, JTI U.K.’s Nordic Spirit nicotine pouches, which were launched in the U.K. in 2019 and are available in a range of flavors and strengths, are said to comprise a discreet product that can be used at any time since, on consumption, they produce no smoke or vapor and contain no tobacco. Here is a product, I think, that indicates the length JTI U.K. has gone to cut the use of combustible products. When it launched Nordic Spirit, the company could have had little idea how the product was going to be received because there was little knowledge about such products among U.K. consumers, who, after all, had not been allowed to buy snus, a cousin of the nicotine pouch. Surprisingly, perhaps, but encouragingly, participants at the London event were told that sales growth had been good, which is perhaps an indication of the importance of choice in offering alternative products to smokers, who too often are treated as if they comprised one homogeneous group with one set of likes and aspirations.

    The news about the growing interest in nicotine pouches must be good, too, for the environment. This is a pared-back product that must have a low negative impact on the environment, a feature that we are all discovering is hugely important. I have to say, too, that during conversations around the display stands, I heard of the initiatives being undertaken by JTI U.K. to ensure that when alternative devices are no longer operable, they are disposed of properly. There is probably some way to go in regard to this, but you have to say that these efforts are likely to be some way ahead of those of the government. As I am writing this piece, of the five people still standing for the leadership of the Conservative Party and therefore to become the next prime minister, only one was unequivocally backing the government’s net-zero emissions by 2050 target.

    It’s worth noting that a small pamphlet, “JTI U.K. at a Glance,” that was made available to participants at the summer event indicated that JTI is still committed, throughout its global operations, to net-zero greenhouse gas emissions by 2050.

  • Smart Sachets

    Smart Sachets

    Photos: Amplicon

    Amplicon presents the first pouch with controlled nicotine release.

    By Stefanie Rossel

    All nicotine pouch brands presently on the market use a form of cellulose as a carrier material. Powdered cellulose is drenched in a mixture of pharmaceutical grade nicotine, flavors and a pH alignment to bring the product’s pH to the optimum level for nicotine uptake. Although the blend is moistened with polyglycol or glycerol, the pouches are slightly dry. This leads to the user feeling the nicotine effect and perceiving the taste within a few seconds after placing a pouch behind the lip. For some users, the sudden intense nicotine hit is too much—they react physically; sometimes they even get sick. Cellulose has another downside: During consumption, it may dissolve into a slimy lump in the consumer’s mouth, thereby quickly losing its flavor.

    Release of pouch nicotine is controlled mainly by the solubility of the nicotine, which means the size of the pouches also determines the release profile. In nontraditional snus markets, users prefer small pouches. These, however, release nicotine and flavor in a very short time.

    Hakan Engqvist

    A Swedish consumer products company set out to solve these issues. In June, Amplicon presented its Freee nicotine pouches, which it describes as the next generation of oral nicotine. While from the outside the pouches look like those already on the market, they are filled with a powder made of bioceramics. Under the microscope, bioceramic granules look like Swiss cheese, having a porous inner structure. The bioceramics used for the pouches belong to a family of chemically bonded ceramics. The substances can be found in nature. For example, hydroxyapatite, a bioceramic generated in the body by biomineralization, forms the basis of the hard matter of all mammals. For the past 40 years, bioceramics have been used clinically for hard tissue replacement.

    Amplicon’s Freee bioceramic platform also contains water, bulk and the active ingredients nicotine and flavor, which bind to that platform. Substance release takes place through diffusion and dissolution. This allows for a more constant, controlled release of nicotine and flavor and better absorption by the human body. The company uses nicotine salt in its pouches. Water-soluble flavors integrate best with the material, but oil-based flavors can be used as well.

    The technology allows manufacturers to produce pouches that are small but pack the punch of much larger products, says Amplicon founder Hakan Engqvist, who is also a professor in materials science at Uppsala University. “Our technology enables customized nicotine-delivery and a much-improved nicotine and flavor experience, and it allows for pH stability over time. It also maintains the consistency of the pouch better. Feedback from consumer tests has been positive.”

    Current pouch products, he explains, also have an issue with shelf life because their pH levels are less stable than they are in bioceramics.

    Tomas Hammargren

    Intelligence Inside

    The new pouch technology stems from pharmaceutical research. “We have been and are still working on an opioid-based pain relief formulation,” says Engqvist. “Through different routes, we started to work with solid vape to load nicotine into the ceramics and thereby reduce the use of e-liquid and instead just have a tablet. Controlled release of nicotine from pouches then became the next development, quite natural in a snus country such as Sweden.”

    Engqvist has lots of experience with bioceramics. Amplicon’s parent company, Emplicure, which he also co-founded, combines biomaterials with existing pharmaceutical substances to deliver drugs precisely and safely. Its controlled-release technology targets unmet medical needs, especially in opioid-based pain relief where its formulations offer not only improved therapy with less discomfort but also reduce the risk of opioid abuse, according to the company.

    Its patented bioceramic platforms are based on tunable nanostructures that enable the distribution of active substances in bioceramic materials. The active substance is then released to achieve the desired effect by controlled diffusion. The release and dosage of the active substances can be tuned by adjusting the size of the pores, the choice of biomaterial and the excipients.

    Amplicon was established to leverage Emplicure’s technology in the nicotine market. In June, the company filed for a trademark registration for Freee nicotine pouches at the European Intellectual Property Office. The company presently manufactures the pouches in-house at pilot scale but says it is able to scale up production from laboratory volumes to commercial volumes. Control over the making of the ceramic powder will stay with Amplicon, which has received a lot of interest in its technology from both established distributors and pouch manufacturers, says Tomas Hammargren, chairman of Amplicon.

    The product is scheduled to hit the market by mid-2023. Initial target markets will include both new, “non-pouch” geographies, such as Europe, Japan and Korea, and existing pouch markets, according to Hammargren. “To reach all important markets, such as Southern Europe or Asia, a pouch product needs to be as small as possible but has to provide a good nicotine and flavor hit, which is difficult to achieve with cellulose,” he says. “It’s hard to imagine an Italian woman putting a big pouch under her lip. The same is true for Asia. Our product is more urban, metropolitan and attractive to female and new users, hence we are confident that it will also be successful in existing oral nicotine markets. It will be the perfect complement for vapers and users of heated-tobacco products in places where smoking and vaping is banned.”

  • Altria Slashes Juul Value

    Altria Slashes Juul Value

    Photo: steheap

    Altria Group reduced the value of its investment in Juul Labs by about 70 percent, to $1.3 billion, following the Food and Drug Administration’s decision to order the e-cigarette company off the U.S. market.

    The stake for which Altria paid $12.8 billion in 2018 is now valued at $450 million–below a level that allows Altria to exit a noncompete agreement and launch its own e-cigarettes. During a July 28 call with analysts and reporters, Altria said it had opted not to be released from that agreement because the arrangement was still beneficial to Altria.

    On June 23, the FDA 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.”

    A federal appeals court then granted Juul Labs a emergency stay of the order to give the judges time to evaluate the merits of Juul’s appeal. The e-cigarette company separately asked the FDA to stay its own order pending the appeal.

    In court filings last month, Juul said the FDA overlooked more than 6,000 pages of data the company had submitted on the aerosols that users inhale.

    On July 5, the FDA temporarily halted its ban on Juul Labs products, saying there were scientific issues unique to the Juul application that warrant additional review.

    The agency stressed that the stay suspends but does not rescind it the marketing denial order while the e-cigarette maker appeals the agency’s decision.

    Altria’s revenue fell 4.1 percent to $12.44 billion in the first half of 2022, as consumers facing high inflation bought fewer cigarettes or switched from premium to discount brands.

    Despite the challenges, Altria CEO Billy Gifford, was pleased with the results.

    “Our tobacco businesses performed well in a challenging macroeconomic environment for the first half of the year,” he said in a statement. “The smokeable products segment delivered solid operating companies income growth behind the resilience of Marlboro, and our moist smokeless tobacco brands continued to drive profitability.

    “Our financial plans for the year remain on track, and we reaffirm our guidance to deliver 2022 full-year adjusted diluted EPS in a range of $4.79 to $4.93.”

     

     

  • Tobacco Sued Over MSA Payments

    Tobacco Sued Over MSA Payments

    Tom Miller

    Iowa Attorney General Tom Miller accuses Philip Morris USA, R.J. Reynolds Tobacco Co., and 16 other tobacco companies of defrauding Iowa of more than $133 million, according to a lawsuit filed Thursday.

    The lawsuit stems from the 1998 Master Settlement Agreement, which requires tobacco manufacturers to pay billions annually to participating states in exchange for the states agreeing not to sue for health-related damages to citizens. The motion, filed in Polk County District Court, alleges that the companies have withheld a portion of their annual payments to Iowa in bad faith and “through a scheme of false claims and feigned ignorance.”

    The tobacco companies demand that Iowa must go to arbitration to recover each year’s withheld payment. According to Miller, it has taken years to litigate each dispute, creating a long backlog and a growing amount of withheld payments. Iowa has prevailed in every dispute, most recently in September 2021, but the companies still refused to pay the amount they withheld from Iowa.

    “We have fought, and won, these legal battles for years, and there is no end to these disputes in sight,” Miller said in a statement. “We now must escalate the matter and force the tobacco companies to pay what they owe the state of Iowa.”

    The lawsuit seeks to recover actual and punitive damages, plus attorneys’ fees and other costs. Under Iowa’s False Claims Act, the state seeks three times the amount of actual damages.

  • New Packaging for ‘1839’ Cigarettes

    New Packaging for ‘1839’ Cigarettes

    Photo: USTC

    Premier Manufacturing, the consumer products division of U.S. Tobacco Cooperative (USTC), has redesigned the packaging for 1839 cigarettes.

    “Premier developed a premium visual design that showcases updated brand colors, a cleaner overall look and the distinctive 1839 logo; all while maintaining some traditional elements to help make 1839 attractive on stores cigarette fixtures,” USTC wrote in a press note.

    “The bold red and rich blues are just some of the colors used in the packaging design that is anchored by historic 1839 elements such as the silhouette of a farmer with the horse and plow on a field image that simulates a tobacco leaf. The 1839 quality seal refers to the heritage and premium blend of tobacco used in the product and the 1839 date is when the flue-cured tobacco process was discovered in North Carolina.”

    Also incorporated is “A Product of US Farmers” that reflects the brands commitment to USTC’s southeast based tobacco farmers who own the cooperative.

    “We believe our new packaging design better reflects the needs of today’s consumers, while reinforcing the brands strength and heritage across the full line of 1839 cigarettes,” said USTC Senior Vice President Russ Mancuso.

  • Vaping Advocate Greg Conley Joins the AVM

    Vaping Advocate Greg Conley Joins the AVM

    Greg Conley

    Longtime vaping industry advocate Gregory Conley is joining the American Vapor Manufacturers Association (AVM) as director of legislative and external affairs.

    Under the direction of AVM President Amanda Wheeler, Conley will focus on government and media relations, while helping advance public policy supporting the American vaping product industry in its fight for survival.

    “Over the last decade-plus, myself and millions of American adults have given up cigarettes because of vaping,” said Conley. “During that time, I have been proud to advocate for vaping from the perspective of a consumer and harm reductionist. In this new role at AVM, I will continue to push for appropriate regulations to ensure that American businesses are not replaced with a multibillion-dollar illicit market.”

    “Gregory is a critical voice for vaping and understands adult smokers and ex-smokers face dire circumstances because of the FDA,” said Wheeler. “One billionaire is pumping hundreds of millions of dollars into campaigns designed to end the vaping industry. The stakes have never been greater and I am thrilled to have him aboard to work towards a unified industry.”

    Conley has a long history of advocacy for vaping products and tobacco harm reduction, dating back to 2010. While receiving a la and business degree from Rutgers University, Conley served as the pro bono legislative director for the Consumer Advocates for Smoke-Free Alternatives Association.

    Conley then founded the American Vaping Association (AVA), and during his time there he testified before dozens of state legislative bodies, appeared on numerous news networks, and participated in a White House listening session with then-President Donald Trump.

    Conley plans to continue working with AVA as it charts a new path forward focusing on voter education and outreach.

  • JT Reports ‘Robust’ Performance

    JT Reports ‘Robust’ Performance

    Masamichi Terabatake (Photo: JT Group)

    The JT Group reported net revenue of ¥1.27 trillion ($9.55 billion) for the second quarter of 2022, up 10.7 percent over that reported in the comparable 2021 quarter. Core revenue at constant exchange rates increased by 3.7 percent to ¥1. 14 trillion. Adjusted operating profit at constant currency increased by 8 percent to ¥386.7 billion.

    On a reported basis, adjusted operating profit increased by 15.8 percent to ¥414.9 billion. Operating profit increased by 18.9 percent to ¥383 billion. Profit increased by 17.3 percent to ¥264.1 billion.

    “In the first half, the JT Group delivered a robust performance, mainly driven by strong pricing,” said JT Group President and CEO Masamichi Terabatake in a statement. “We are also encouraged by the Ploom X volume and share performance in Japan. In the second half of the year, we will be leveraging learnings from Japan for international Ploom X launches.

    “We have revised our 2022 full year reported adjusted operating profit and profit guidance upwards, driven by favorable currency movements against the Japanese yen. However, the adjusted operating profit at constant FX is revised downwards considering higher input costs impacting our supply chain operations. Dividend per share guidance for full year remains unchanged at 150 yen per share. The interim dividend is 75 yen per share.

    “Regarding Russia, while we continue to manufacture and distribute our products in full compliance with national and international sanctions, the operating environment is becoming increasingly complex. Under these circumstances, the JT Group continues to evaluate various options for its Russia business, including potentially transferring its ownership, and taking necessary decisions to address the changing situation in accordance with the group’s management principle.”

  • Push To End ‘Essential Commodity’ Status

    Push To End ‘Essential Commodity’ Status

    Photo: sezerozger

    The Bangladesh Ministry of Health and Family Welfare has asked the Ministry of Commerce to remove cigarettes from the essential commodities list, reports The Business Standard. The removal is necessary to help the government achieve its “tobacco-free Bangladesh” objectives, according to the health ministry.

    Any product covered by the Essential Commodities Act enacted 66 years ago can be freely promoted for wholesale and retail, and no restrictions can be imposed on the marketing of these products, even under emergency circumstances.

    Workers in the essential commodities sector cannot strike, and no essential commodities can be hoarded. The essential commodities list was created when Bangladesh was still part of Pakistan. Over the years, new products, including palm oils, turmeric and cumin, have been added, but none have been taken off. Other products on the list include typewriters, 35 mm (cine) raw films and sewing machines.

    The law permitted tobacco companies to continue operating through the Covid-19 pandemic, even as other factories, including in Bangladesh’s garment industry—the country’s main export sector—were shut down.

    In 2016, Prime Minister Sheikh Hasina set a goal to make Bangladesh tobacco-free by 2040.

    Because cigarettes are listed as an essential product, however, it is impossible for the government to fully implement the Smoking and Using of Tobacco Products (Control) Act.

    Further complicating matters, cigarettes are the largest source of government revenue. The National Board of Revenue collected BDT278.3 billion ($2.95 billion) in value-added tax and excise duty from cigarettes in fiscal year 2021–2022.

    According to the Bangladesh Cancer Society, the government spent BDT305.7 billion in fiscal year 2017–2018 to treat patients with tobacco-related illnesses.