Tobacco Update

Black-market woes, e-cig booms, dollar-store growth and more news from the tobacco category

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“They had no data on daily usage, no data on addiction to e-cigs, no data on progression from e-cigs to smoking. Being truthful is not necessarily just about saying true things, if that truth is misleading,” he said.

Unfortunately, many public-health groups have been leery of—if not outright opposed to—electronic cigarettes.

“It’s hard to let go of an enemy who’s killed so many people,” said Scott Ballin, a tobacco and health policy consultant who has worked with groups such as the American Heart Association. “It’s something that’s ingrained, but I think we have to get over it.”

Supplier Updates
Altria Group Inc. announced late last year it has entered into a series of agreements with Philip Morris International Inc. (PMI) addressing the intellectual property licensing, regulatory engagement and contract manufacturing of e-cigarettes and other products—which could greatly impact the company’s place in the e-cig category. Altria is providing PMI with an exclusive license to commercialize Altria’s e-vapor products internationally. PMI is providing Altria, on an exclusive basis, two of PMI’s heated tobacco products for commercialization stateside.

“This could have a significant positive financial impact, particularly for [Altria], since [its] licensing arrangement with PM allows [Altria] to participate in the global e-cig category, which we continue to anticipate will generate substantial growth and profits,” said Wells Fargo’s Herzog at the time of the announcement.

“Although PM will be licensing the MarkTen technology internationally, it may use the MarkTen brand name and/or it could choose to brand this technology as something else, including an existing brand such as Marlboro.”

Vapor Corp. unveiled in January the working prototype of the Vapor X personalized, rechargeable vaporizer unit with patent-pending fingerprint lock technology at the Consumer Electronics Show in Las Vegas. The technology will allow for security as well as personalization.

The company said it will be available in the second half of 2014 to consumers online and through authorized dealers nationwide, retailing for $199 to $299.

“The next trend in alternative smoking devices is the personalized vaporizer that incorporates the technology that we expect from our high-end tech devices,” said Kevin Frija, CEO of Vapor Corp., in a release from the company. “Much like the fitness mobile app technology we have seen gain recent popularity, vaporizer users will soon be able to download their ‘vaping’ statistics through a corresponding mobile application in order to track exactly how often they use the device.”

R.J. Reynolds Vapor Co. is rolling Vuse out in Utah in January; it plans national distribution by mid-2014. Vuse was launched in “test” July 1 in Colorado. Since then, it has achieved a roughly 62% market share in Colorado, with 72% of sales coming from cartridges, indicating repeat purchases.      

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