Tag: Featured

Stories featured at the top of tobaccoreporter.com

  • Juul Labs Submits PMTA for Juul system

    Juul Labs Submits PMTA for Juul system

    Photo: Juul

    Juul Labs has submitted a Premarket Tobacco Product Application (PMTA) to the U.S. Food and Drug Administration (FDA) for the company’s Juul system, an electronic nicotine delivery system (ENDS) product. The company’s submission includes comprehensive scientific evidence for the Juul device and Juul pods in Virginia Tobacco and Menthol flavors at nicotine concentrations of 5.0 percent and 3.0 percent, as well as information on its data-driven measures to address underage use of its products.

    With its PMTA submission, Juul Labs has provided a scientific foundation for the FDA to evaluate whether these products are “appropriate for the protection of the public health” with respect to the risks and benefits to the population as a whole. The application includes detailed scientific data from over 110 studies totaling more than 125,000 pages evaluating the product’s impact on both current users of tobacco products and nonusers, including those who are underage.

    As part of the PMTA process, Juul Labs has built a comprehensive research program focused on examining the public health impact of the Juul system. This includes research addressing the harm reduction potential of the product, including its ability to convert adult smokers from combustible cigarettes. This research is supplemented with information on the controlled design and repeatable manufacturing processes associated with the Juul system, as well as data-driven measures to limit unintended consequences to the overall population, including initiation among nonusers.

    “In order to earn a license to operate in society, we need to be a science and evidence-based company, engage in open and transparent dialogue with our stakeholders, and take methodical and responsible actions to advance the potential for harm reduction for adult smokers while combating underage use. Our PMTA submission is a key part of that approach,” said Juul Labs CEO K.C. Crosthwaite.

    “Juul Labs has committed all necessary resources to deliver the best possible PMTA based on rigorous scientific research and data-driven measures to address underage use,” said Joe Murillo, chief regulatory officer at Juul Labs. “We respect the PMTA process and believe it is the right forum to determine the role ENDS products can play in transitioning and completely switching adult smokers from combustible cigarettes to potentially less harmful alternative products while combating underage use.”

    Late last year, the company, under Crosthwaite’s leadership, committed to resetting the vapor category and seeking to work cooperatively with regulators, legislators, attorneys general, public health officials, and other stakeholders to combat underage use and transition adult smokers from combustible cigarettes. As part of that process, the company reduced its product portfolio, halted television, print, and digital product advertising, built up its science and evidence-based capabilities, and supported the U.S. Administration’s final flavor policy for ENDS products, while taking a methodical approach to its global presence.

    Juul Labs has built up its science and evidence-based capabilities and will use its research and data to explore additional pathways in other countries. The company will continue to share its research with regulators and the public health community globally through peer-reviewed journals, conferences, and one-on-one meetings.

  • Japanese Cigarettes Unaffected by Boycott

    Japanese Cigarettes Unaffected by Boycott

    Photo: okaybuild from Pixabay

    Sales of Japanese cigarettes have remained resilient in South Korea despite a consumer boycott against Japanese products, reports The Korea Bizwire.

    The Korea Customs Service reported that South Korea imported 4,220.6 tons of cigarettes from the Philippines between July last year and June of this year, which was merely 2.79 percent lower than the volume of imports during the same period in the previous year.

    Among the top four cigarette companies dominating the South Korean market, Japan Tobacco International (JTI) is the only company with a production plant in the Philippines. All cigarette imports from the Philippines, therefore, are de facto produced by JTI.

    Sales of Japanese cars and beer, by contrast, have declined significantly in Korea because of the boycott, which was sparked by a deepening dispute over the countries’ wartime legacy.

    Experts say tobacco consumers tend to be more brand loyal than users of other products. What’s more JTI’s share in South Korea has been comparatively small, lowering the chance of being affected by the boycott movement.

  • RJR Remains Liable for Litigation Payments

    RJR Remains Liable for Litigation Payments

    A Florida state appeals court ruled that R.J. Reynolds (RJR) owes the state $100 million from a 1997 settlement.

    RJR argues that it should not have to make payments for the Salem, Winston, Kool and Maverick brands as RJR sold those brands to ITG Brands in 2015.

    “We find, simply put, that a contract is a contract and that Reynolds continues to be liable under the contract it signed with the state of Florida,” said the court’s decision, written by Chief Judge Spencer Levine.

    “The FSA (Florida Settlement Agreement) required that Reynolds make annual payments to the state of Florida in perpetuity, with no condition of termination, in exchange for the release of liability for past and future medical costs incurred by the state of Florida,” Levine wrote.

  • Juul Appoints New Board Members

    Juul Appoints New Board Members

    Juul Labs CEO K.C. Crosthwaite will also become chairman of the company’s board, succeeding co-founder Adam Bowen, reports Bloomerg. Bowen, who became Juul’s first chairman when Crosthwaite joined the company last fall, will head up the product committee.

    Juul also appointed Teresa Sebastian, an executive with financial and compliance expertise, to join its board as the company seeks to reset its business and diversify its ranks.

    Sebastian is the first black member of the company’s eight-person board. In May, Juul added former Canadian Health Minister Rona Ambrose as an independent director, making her its first female board member.

    The changes come at a pivotal moment for Juul, with corporations under pressure to promote diverse voices and Juul trying to shore up its finances and win regulators’ permission to keep selling its e-cigarettes in the U.S.

    “We are all aware that our company is entering a critical period,” Bloomberg quoted Crosthwaite as saying. “With the support and oversight of our increasingly robust board, we will deliver our first PMTA submissions to the FDA, while continuing the work of combating underage vaping and transitioning adult smokers all around the world from combustible cigarettes.”

    Applications with the Food and Drug Administration are due Sept. 9.

  • WHO Remains Skeptical About Heating Products

    WHO Remains Skeptical About Heating Products

    Photo: Tobacco Reporter archive

    The World Health Organization (WHO) has reminded its member states of their tobacco obligations under the Framework Convention of Tobacco Control (FCTC) in relation to heat-not-burn products (HNB).

    “Heated tobacco products are tobacco products, meaning that the WHO FCTC fully applies to these products. [Rules] obliges Parties, to prohibit ‘all forms of tobacco advertising, promotion and sponsorship that promote a tobacco product by any means that are false, misleading or deceptive or likely to create an erroneous impression about its characteristics, health effects, hazards or emissions,” the health body wrote in a statement.

    The WHO claims that reducing exposure to harmful chemicals in HNB products does not render them harmless, nor does it translate to reduced risk to human health. “Indeed, some toxins are present at higher levels in [HNB] aerosols than in conventional cigarette smoke, and there are some additional toxins present in [HNB] aerosols that are not present in conventional cigarette smoke,” the WHO wrote. The organization also claims that the health implications of exposure to HNB products are unknown.

    The WHO statement comes after the U.S. Food and Drug Administration (FDA) authorized Philip Morris International to make a modified exposure claim about its IQOS HNB device in the United States.

    The WHO says there is no proof that HNB products are safer than cigarettes. “Given that health may be affected by exposure to additional toxins when using [HNB], claims that [HNB] products reduce exposure to harmful chemicals relative to conventional cigarettes may be misleading.

    “Moreover, the relevant orders grant a temporary market authorization within the U.S. and are based on factors specific to the US, which is not a Party to the WHO Framework Convention on Tobacco Control.”

  • Altria Reestablishes 2020 EPS Guidance

    Altria Reestablishes 2020 EPS Guidance

    Photo: Altria

    Altria Group announced its 2020 second-quarter and first-half business results and reestablished 2020 adjusted diluted earnings per share (EPS) guidance. It also announced an increase in its quarterly dividend ahead of its previously scheduled dividend declaration date.

    Net revenues were down 3.8 percent to about $6.4 million from the second quarter of 2019.

    “Over the first half of 2020, we believe Altria showed resilience in volatile market conditions, growing adjusted diluted earnings per share by 8.5 percent, driven by the outstanding financial performance of our core tobacco businesses,” said Billy Gifford, Altria’s CEO. “We’ve also hit key milestones and made steady progress behind our noncombustible product portfolio.”

    “With a better understanding of Covid-19 impacts on adult tobacco consumer purchasing behavior and an additional quarter of ABI earnings contributions, we’re reestablishing full-year 2020 adjusted diluted EPS guidance.”

    Altria expects its 2020 full-year adjusted diluted EPS to be in a range of $4.21 to $4.38, representing a growth rate of 0 percent to 4 percent from an adjusted diluted EPS base of $4.21 in 2019.

    “We’re pleased to announce that yesterday, our board declared a quarterly dividend of $0.86 per share, representing a new annualized dividend rate of $3.44 per share and an increase of 2.4 percent from the previous annualized rate of $3.36 per share,” said Sal Mancuso, Altria’s chief financial officer. “This dividend increase marks the 55th dividend increase in the past 51 years.”

    To date, Altria recorded net pre-tax charges of $50 million, directly related to costs for disruptions caused by, or efforts to mitigate the impact of, the Covid-19 pandemic. These pre-tax charges included premium pay, personal protective equipment and health screenings, partially offset by certain employment tax credits.

    Altria said its tobacco businesses have not experienced any material adverse effects associated with governmental actions to restrict consumer movement or business operations but continue to monitor these factors. Most retail stores in which their products are sold, including convenience stores, have been deemed to be essential businesses by authorities and remain open.

  • Sales and Profit up at Turning Point Brands

    Sales and Profit up at Turning Point Brands

    Photo: Tobacco Reporter archive

    Turning Point Brands (TPB) announced its second-quarter results and increased its 2020 guidance.

    Net sales increased 12.5 percent to $105 million, and gross profit increased 16.8 percent to $48.1 million. Net income decreased $4 million to $9.2 million, reflecting the inclusion of expensing premarket tobacco product application (PMTA) costs incurred during the current quarter compared to the net gain related to a settlement from the V2 winddown in the previous year’s quarter. Adjusted EBITDA increased 24.8 percent to $22.8 million.

    Absent any further acquisitions, the company projects 2020 net sales to be $370 million to $382 million (up from previous guidance of $338 million to $353 million). It projects 2020 adjusted EBITDA of $78 million to $83 million (up from previous guidance of $69 million to $75 million). Its projections assume no upside from the PMTA process in 2020.

  • KT&G Aims for No. 4 Position

    KT&G Aims for No. 4 Position

    Photo: KT&G

    KT&G has stated that by 2025, it aims to become the fourth largest tobacco company in the world.

    “KT&G aims to increase the number of exporting countries from 80 to over 200 by 2025,” the company said in a statement. “Through this, we set the new goal of becoming the No. 4 tobacco company in the global market by then.”

    KT&G was the No. 5 tobacco maker in the world by sales volume and market share in 2016, according to Euromonitor International. To reach its No. 4 goal, the company has been exploring new markets and plans to increase investments in its global subsidiaries’ distribution network and marketing infrastructure.

    KT&G’s global ambitions were also highlighted in Tobacco Reporter‘s July 2020 issue.

  • BAT: Illicit Traders Have Taken Over South Africa

    BAT: Illicit Traders Have Taken Over South Africa

    Photo: BAT

    British American Tobacco South Africa (BATSA) declared today that the entire domestic cigarette market is now controlled by illicit suppliers. BATSA added that the nation’s lockdown of legal cigarette sales during the Covid-19 pandemic has cost the country ZAR4 billion ($241.7 million) in lost excise tax revenues and 30,000 industry jobs lost.

    “With an already overstretched consumer, further increasing the cost of tobacco products will simply mean they default to the illicit market, which is now significantly cash-flush and can now afford to significantly reduce their prices,” said BATSA spokesperson Johnny Moloto.

    “This means that tax-compliant manufacturers like ourselves continue to be at a disadvantage while the state is losing around ZAR35 million [$2.1 million] every single day in excise taxes.”

    Moloto added, “These illicit supply chains will be so entrenched that it will be difficult for SARS (South African Revenue Service] to be able to reverse this or deal with this within a short period of time.”

  • Vietnam Struggling With Smuggling

    Vietnam Struggling With Smuggling

    Photo: Tobacco Reporter archive

    Vietnam loses VND8.5 trillion ($366.4 million) in tax revenue each year to tobacco smuggling, according to a recent article in Vietnam News.

    Tobacco use among those in Vietnam is more than 45 percent, with a constant increase in young people taking up smoking. Vietnam is one of 15 countries with the highest rate of smokers, according to the World Health Organization. Tobacco-smuggling brings high profits, according to Nguyen Mahn Hung, chairman of the Vietnam Consumer Protection Association.

    “Smuggling can bring profits of up to 400 percent while official imported cigarettes are subject to import tax of between 100 percent and 202.5 percent and value added tax of 10 percent,” he said. Vietnam is third in the region for illegal tobacco trading, with 21 billion sticks of illegal tobacco products. 

    In related news, Health experts and anti-smoking advocates met at a conference by the Ministry of Information and Communications in Ho Chi Minh City, on July 23 to express their concerns about the rising incidence rates of vapor and heat-not-burn (HNB) tobacco products among youth.

    Phan Thi Hai, deputy director of the Vietnam Tobacco Control Fund under the country’s Ministry of Health, noted that while his ministry has worked hard to decrease cigarette consumption in recent years, it has been outflanked by the large rise in vapor and HNB tobacco product users.

    Hai said that the makers of these products use “compact, eye-catching designs and various flavors” to entice new users, whether they are smokers or nonsmokers.

    Le Thi Thu from HealthBridge Canada urged the Vietnam government to develop a legal framework to control vapor and HNB tobacco products with authorities to make extra efforts to inspect and prevent production, imports, marketing and sales of these products.