Tag: Featured

Stories featured at the top of tobaccoreporter.com

Prime Minister asks BAT to Stay in Croatia

Photo: TDR
The government of Croatia is trying to convince British American Tobacco (BAT) to stay in Kanfanar, reports SeeNews. In June, reports surfaced that the company might relocate its Croatian factory to another country.
“We are holding talks; I am sure that we will reach a quality agreement that will enable them to stay in Croatia,” Prime Minister Andrej Plenkovic said in a press release on Tuesday.
BAT acquired the cigarette factory in 2015 when it acquired Tvornica Duhana Rovinj. At the time of its entry into Croatia, BAT signed a deal to stay in the country at least five years, according to Plenkovic. In 2018, BAT announced a €40 million investment in its Kanfanar facility.
The factory in Kanfanar currently produces 12 billion cigarettes per year. Its production capacity is 20 billion units.
In June, Glas Istre reported that some 500 employees could lose their jobs if the tobacco giant moved its Kanfanar production abroad.
September 10, 2020
Criminals Embedded in Supply Chain After Ban

Photo: Tobacco Reporter archive
Dismantling the criminal networks that sprung up during South Africa’s ban on tobacco and alcohol sales may take years, according to Edward Kieswetter, the country’s revenue service commissioner.

The ban, aimed at managing the health impact of the Covid-19 pandemic, has allowed illegal operators to gain a foothold in the market, Kieswetter said in an online address to tax practitioners.

Having marketed themselves to previously honest smokers and drinkers during the ban, illegal and criminal operators are now embedded in the supply chain, according to Kieswetter.

Tobacco and liquor remained readily available through the black market after the ban took effect on March 27. Producers and retailers complained the restrictions have resulted in thousands of job losses and encouraged illegal trade.

National Treasury data show the government lost out on ZAR9.5 billion ($568 million) in alcohol and tobacco taxes in the first four months of the fiscal year. A 2018 report published by Tobacco Institute showed South Africa was already one of the world’s biggest markets for illicit cigarette sales at the time.

While the bans were lifted in the middle of August, shops are still only allowed to sell alcohol four days a week, and the authorities have warned they could reinstate the curbs if needed.

September 9, 2020
ITSHub Canceled as Coronavirus Spikes

Photo courtesy of Messe Dortmund
Messe Dortmund has canceled its ITShub event, which was scheduled to take place Nov. 3-4, 2020, at the Dortmund Exhibition Center in Dortmund, Germany.
Messe Dortmund announced ITShub hybrid platform earlier this year, as an interactive substitute for the InterTabac and InterSupply trade fairs, which have been postponed to 2021 because of the coronavirus pandemic.
Rising virus infections around the world have now prompted the organizers to call off ITShub, as well.
“The way infections have been trending over the last few weeks has unfortunately made our plans for this successful ITShub pilot considerably more difficult to achieve,” said Sabine Loos, managing director of Westfalenhallen Unternehmensgruppe, in a statement.
“Feeding the online part of a hybrid event with content for virtual visitors naturally requires a panoply of physical events, but the travel associated with being physically present remains a real challenge—especially for international participants—and in the end this is what led to the event being cancelled.”
September 9, 2020
Turning Point Submits PMTAs for 250 Products

Photo: Bacho | Dreamstime
Turning Point Brands (TPB) has submitted to the U.S. Food and Drug Administration (FDA) premarket tobacco product applications (PMTAs) for 250 products.
The PMTAs cover a broad assortment of products in the vapor category including multiple proprietary e-liquid offerings in varying nicotine strengths, technologies and sizes. They also include proprietary replacement parts and components of open system tank devices, along with a closed system e-cigarette.
According to TPB, the filings provide detailed scientific data to demonstrate that the products are “appropriate for the protection of public health,” as required by law.
The applications are supported by five pharmacokinetics studies, a likelihood-of-use study, and a patterns-of-use study, in addition to a toxicological review. Data throughout the applications underline that TPB products do not appeal to never users, youth or former users; that an extremely small percentage of users are never users, youth, or former users; that a significant majority of users have completely ceased use of combustible cigarettes; that a low percentage of users engage in dual or poly use; and that the products are substantially less harmful than combustible cigarettes and comparable to other products in the vapor category.
TPB has also provided a detailed marketing plan to illustrate how it will continue to prevent youth exposure to the products.
“We look forward to engaging with the FDA as it reviews our submissions,” said Larry Wexler, president and CEO of TPB.
The FDA deadline for submitting PMTAs is today.
September 9, 2020
Universal Buys Silva International

Photo: Jerzy Górecki from Pixabay
Universal Corp. has entered into a definitive agreement to acquire Silva International, a privately held, natural, specialty dehydrated vegetable, fruit and herb processing company, for $170 million in cash. Following the close of the transaction, Silva will operate as part of Universal’s plant-based ingredients platform, which includes FruitSmart and Carolina Innovative Food Ingredients.
Founded in 1979, Silva procures over 60 types of dehydrated vegetables, fruits and herbs from more than 20 countries around the world. In addition to sourcing, the company specializes in processing natural raw materials into custom designed dehydrated vegetable- and fruit-based ingredients for a variety of end products. Headquartered in Momence, Illinois, Silva employs more than 200 people and has a 380,000 square foot manufacturing facility.
George Freeman
“We’re excited to have reached this agreement with Silva as we continue to diversify our offerings and generate new opportunities for value creation,” said George C. Freeman III, chairman, president and chief executive officer of Universal Corp. “This acquisition builds on our investment in FruitSmart and expands our plant-based ingredients platform. With this acquisition, we expect these businesses to represent 10 percent to 20 percent of our EBITDA by fiscal year 2022, ahead of our previously stated target outlined as part of our capital allocation strategy.”
Universal Corp. expects the transaction to close in October of this year, subject to customary closing conditions. The company anticipates its acquisition will be accretive to earnings in the first fiscal year following closing and expects to fund the transaction with cash on hand and borrowings under its committed revolving credit facility.
September 9, 2020
Vaping Soars in U.S., According to New Study

Photo: Lorendiz Gonzalez from Pixabay
Nearly 14 million U.S. adults vaped in 2018, up from just over 11 million adults in 2016, according to a new study published online Sept. 8 in JAMA Internal Medicine.
“An increasing number of individuals are using e-cigarettes, especially in the younger age groups, which suggests that more individuals are becoming addicted to e-cigarettes rather than just experimenting with them, making the increased uptake among tobacco-naive individuals even more concerning,” said lead researcher Olufunmilayo Obisesan, a postdoctoral fellow at Johns Hopkins Ciccarone Center for the Prevention of Cardiovascular Disease, in Baltimore.
Between 2016 and 2018, young adults aged 18 to 24 years old were the fastest-growing population to start using e-cigarettes. E-cigarette use in that age group increased from 9 percent in 2016 to 15 percent in 2018, Among students, e-cigarette use increased from 6 percent in 2016 to 12 percent in 2018.
E-cigarette use even increased among people who had never smoked traditional cigarettes—from more than 1.4 percent in 2016 to 2.3 percent in 2018, the findings showed.
The increase was seen in all socioeconomic groups, the researchers found.
For the study, the researchers collected data on more than 1 million Americans who took part in the Behavioral Risk Factor Surveillance System for 2016 to 2018.
September 9, 2020
Tobacco to Dominate Vapor Business Post-PMTA

Photo: Ethan Parsa from Pixabay
Tomorrow’s deadline for the submission of premarket tobacco product applications (PMTAs) to the U.S. Food and Drug Administration (FDA) marks the start of a new era for the e-cigarette industry, according to an article published by The Motley Fool.

Companies who fail to apply for marketing authorization by the deadline will be required to remove their hardware and e-liquids from store shelves, and The Motley Fool expects many e-cigarette companies to exit the business.

Because the cost of complying with the regulations is staggeringly high, many manufacturers will not be able to make it over the hurdle, and the e-cigarette market will be left largely to the tobacco giants.

Although the FDA estimates a single PMTA costs anywhere from $117,000 to $466,000, those figures are considered low by the industry. The Rocky Mountain Smoke-Free Association estimates a single PMTA costs between $8.6 million and $11.1 million per stock keeping units. It forecasts 14,000 small vape businesses employing 166,000 workers will be destroyed, representing $24 billion in economic activity.

Deep-pocketed Philip Morris International, by contrast, already has four separate PMTAs approved: one for its IQOS heated-tobacco device and three for flavors of its disposable HeatSticks.

As of Aug. 31, the FDA had received applications for around 2,000 deemed products, of which around 40 percent have been resolved, according to Mitch Zeller, director of the agency’s Center for Tobacco Products.
September 8, 2020
Taat Seeks Patent Protection

Photo: Taat Lifestyle & Wellness
Taat Lifestyle & Wellness has filed a patent application with the U.S. Patent and Trademark Office for the proprietary refinement process of the base material for Beyond Tobacco cigarettes. This process contributes to the tobacco flavor and aroma of Beyond Tobacco cigarettes, which is the product’s hallmark feature as a tobacco-free and nicotine-free alternative to tobacco cigarettes.
“Patents are of incredible importance in this industry because when you consider that the global market for tobacco is worth more than $800 billion, you’re not just protecting years or decades of research and hard work, you’re also protecting the ability to recover your investment and earn a profit,” said Taat CEO Setti Coscarella.
“The company has been on the path to commercialization for just a matter of months, which followed a lengthy period of research and development for Beyond Tobacco cigarettes. As confident as I may be that the truly ‘magic’ parts of this product would be nearly impossible for anyone to duplicate, anybody who has worked in this industry knows that patents can be extremely cost-effective, given how expensive not having a patent can be in some cases.”
To help smokers quit tobacco, Taat has sought to closely replicate the experience of smoking a tobacco cigarette.
September 8, 2020
Ireland: Call to Strengthen Menthol Ban

Photo: Miriam Doerr | Dreamstime.com
The government of Ireland wants to strengthen the four-month-old EU ban on menthol cigarettes to stop tobacco companies side-stepping it. The Health Service Executive (HSE) is investigating tobacco companies over the issue.

Introduced on May 20, the EU measure aims to prevent “characterizing flavors” in cigarettes to make them less attractive to children and help smokers quit.

Japan Tobacco International (JTI) has admitted it still adds some menthol to products, including a new Silk Cut Choice Green that was among a suite of new brands it introduced into the Irish market after the ban. However, JTI insists it is in full compliance with the ban because, it claims, the additive doesn’t make its new brand taste or smell of menthol.

JTI’s new brands scooped up 5 percent of Ireland’s €1.8 billion ($2.12 billion) cigarette market in their first month, according to industry data.

After complaints from anti-smoking groups and rival tobacco companies that retired their menthol blends, the HSE said in June it would cooperate with European authorities on the issue.
Across Europe, tobacco companies have been introducing alternatives to their discontinued menthol brands. Governments have criticized tobacco companies for trying to get around the ban.

Health Minister Stephen Donnelly noted the directive is being reviewed at EU level and said he would strongly support any revisions to the directive that would ensure that the provision in relation to the menthol ban is “robust.”

The market for menthol cigarettes was worth €250 million prior to the ban.
September 8, 2020
RAI Concludes PMTA filings for 2020

PHoto: RAI
Reynolds American Inc. (RAI), has filed its final premarket tobacco product application (PMTA) submissions with the U.S. Food and Drug Administration (FDA) to allow its Vuse and Velo brands to remain on the market in the United States.
Submitted Sept. 4, the filing concludes an 11-month process for RAI. The company has filed six applications for its Vuse Solo, Vuse Ciro and Vuse Vibe vapor products, as well as for its Velo nicotine lozenge and modern oral pouch products. Across the six applications, more than 530,000 pages of scientific data and more than 8,600 scientific documents have been submitted as part of the filings.
RAI parent company BAT says it is committed to reducing the health impact of its business with a multicategory approach that offers consumers a wide range of enjoyable and lower-risk alternatives to cigarettes. With noncombustible nicotine products now available in more than 40 countries, the group’s ambition is to exceed 50 million noncombustible consumers by 2030.
Kingsley Wheaton
“The U.S. is the world’s largest vaping market and so the completion of our PMTA filings is a really important step for us as we transform our organization, drive a step change in our ‘new categories’ business, and increase our non-combustible consumer base and revenues,” said Kingsley Wheaton, chief marketing officer of BAT.
“Our transformation is progressing very well and in the first six months of 2020 we attracted an additional 2.7 million new noncombustible consumers compared to the same time last year. Globally, we now have nearly 12 million regular noncombustible consumers and the U.S. will play a large part of our ambition to grow this number to at least 50 million by 2030.
“We remain fully committed to building a better tomorrow and reducing the health impact of our business by offering consumers a range of enjoyable and lower risk products including vapor, tobacco heating and modern oral nicotine products.”
The FDA’s PMTA deadline is Sept. 9.
September 7, 2020