The WS-23 cooling agent has limited impact on the experiment animals at the tested dose, according to a study performed by RLX Technology and published in the Journal of Applied Toxicology.
The RLX Technology study showed that there were no deaths in any of WS-23 treated groups in the acute and subacute inhalation studies, with no remarkable changes occurred in body weight, organ weight, hematology and serum biochemistry and no toxic effects in the histopathologic analysis.
It was the first study published on the Science Citation Index (SCI) indexed journal conducted by the Chinese e-cigarette industry.
WS-23 is a well-known artificial synthesis cooling agent widely used in foods, medicines and tobaccos. As a common cooling agent in e-cigarette liquids, WS-23 has led to concerns about the inhalation toxicity with the proliferation of e-cigarettes in recent years. The study shows that at the tested dose level, inhalation of WS-23 will not bring toxic side effects to test animals.
“Product safety has always been RLX’s top concern, and it is also the direction and commitment in our research and development,” said Xingtao Jiang, head of RELX Lab, which is part of RLX Technology, in a statement. Before the study was published, RELX Lab conducted vitro tests to prove the aerosol-containing WS-23 is safe to use in the products.
RELX International will launch its next-generation e-cigarettes, the Infinity and Essential, in Colombia this month. The Infinity features RELX International’s latest innovations in product design, vapor quality, mobility and overall user experience. The Essential allows users to experience key elements of the Infinity’s design at a more accessible price point.
According to RELX, Infinity and Essential feature a full flavor and smooth puff due to the independently developed Super Smooth Performance technology. With more than a year dedicated to the design process, this data-driven technology was developed by defining five key elements that constitute the perfect puff. This technology was perfected through 76 sensory tests and repeated refinements of the parameters measuring RELX Super Smooth Performance.
The design of the Infinity device was optimized more than 40 times, and more than 12,000 pods were tested to ensure leak resistance and high-quality standards. Patent applications have been submitted for more than 50 innovations used in the device, including its leak-resistant design, e-liquid pods and wireless charging case. In March 2020, the Infinity was awarded the Red Dot Award: Product Design 2020.
Our goal is to help smokers who cannot or do not want to quit to transition to a better alternative with confidence.
“I’m proud of the entire RELX global team for creating this beautifully designed Infinity device with superior technology and with a dedication to innovation that we are now known for worldwide,” said RELX International CEO Bing Du in a statement. “Ultimately our goal is to help current smokers who cannot or do not want to quit to transition to a better alternative with confidence. The more budget-friendly Essential device also allows users to experience RELX’s premium quality features.”
The Chinese government wants to overhaul the rules governing the market for electronic nicotine-delivery systems (ENDS), according to the South China Morning Post.
Draft regulations posted online by the Ministry of Industry and Information Technology (MIIT) suggest it will seek to regulate these products like traditional cigarettes. The ministry is seeking public comments on the draft regulations until April 22. With an estimated 300 million smokers, China is the world’s largest market for tobacco products and the largest potential market for ENDS.
The news caused the share price of RELX, China’s largest e-cigarette brand, to plunge. At 2:45 p.m. today, its value on the New York Stock Exchange was down nearly 45 percent to $10.69 per share after a recent high of $19.46 per share on March 19.
RLX Technology raised $1.4 billion during its initial public offering (IPO) in January this year. It sold 116.5 million shares with a target price of between $8 and $10 a share. Its market debut turned its 39-year-old founder, Wang Ying, into a billionaire overnight with an estimated net worth of $24.8 billion.
In its prospectus, RLX stated that vaping products only have a 1.2 percent penetration rate in China compared with 32.4 percent in the U.S. According to the China-based Electronic Cigarette Industry Committee, China’s 2020 e-cigarette sales were an estimated CNY14.5 billion ($2.2 billion), an increase of 30 percent from 2019. The U.S. e-cigarette market in 2019 was worth $5.34 billion, according to Grandview Research, which expects the U.S. market to reach $6.50 billion in 2020.
RELX recently announced a partnership with 110 authorized distributors to supply its products to more than 5,000 RELX-branded partner stores and more than 100,000 other retail outlets nationwide, covering over 250 cities in China, according to its prospectus. Revenue for the company nearly doubled in the nine months ended Sept. 30, 2020, to $324 million, with a net income of $16 million, the latest figures available at the time of this writing.
Under scrutiny
Vapor companies are increasingly facing scrutiny from regulators in China. In 2018, the country made it a crime to sell a vapor product to anyone under 18 years of age. In November 2019, an online sales ban was implemented in order to further prevent youth initiation. In 2020, the country passed the Law of the People’s Republic of China on the Protection of Minors. That law is aimed at preventing parents or other guardians from “indulging or instigating minors” to smoke or vape.
The China National Tobacco Corp. (CNTC), which holds a monopoly of tobacco manufacturing in China, is a major source of funding for the Chinese government. Its contribution accounted for an estimated 5.45 percent of the country’s tax revenue in 2018. That amounts to CNY10.8 trillion, according to media reports. The vapor industry in China, by contrast, remains largely in private hands. If CNTC were to enter the vapor market, the monopoly’s existing 5 million domestic retail outlets could present a major challenge for private vape shop owners.
RLX Technology is looking to raise as much as $1.17 billion from a U.S. initial public offering, reports Bloomberg.
The Chinese vapor company, known for its RELX-branded devices in China, had earlier considered Hong Kong as a listing venue, but it ultimately opted for the U.S.
Founded in 2018, RLX is China’s largest e-cigarette maker. The vaping industry has boomed in China even as the country banned online sales of e-cigarettes just over a year ago.
China is the world’s largest potential vaping market, with an estimated 286.7 million adult smokers in 2019, RLX said in its prospectus. But vaping products only have a 1.2 percent penetration rate, compared with 32.4 percent in the U.S.
RLX’s revenues increased to CNY2.2 billion ($340 million) in the first nine months of 2020 from CNY1.14 billion a year earlier. It started turning a profit in 2019 and recorded net income of CNY109 million in the nine months to Sept. 2020.
The company plans to price the IPO on Jan. 20 after the U.S. market closes, according to a term sheet. Citigroup and China Renaissance are joint bookrunners for the offering.
Earlier reports suggested the company planned to raise up to $100 million in its IPO.
