Tag: Zyn

  • Consumer Files Suit for Alleged Overcharging for Zyn

    Consumer Files Suit for Alleged Overcharging for Zyn

    VV Archive Photo

    Swedish Match North America is being sued for allegedly overcharging U.S. customers for its popular tobacco-free Zyn nicotine pouches.

    The class action lawsuit, filed on Monday in federal court in Richmond, Virginia, alleges that the Philip Morris International subsidiary is violating federal and state antitrust laws concerning the market for modern oral nicotine pouches.

    The plaintiff, a resident of Florida, claimed that Swedish Match illegally gained monopoly power through various business practices aimed at eliminating rival Dryft from the market, Reuters reports.

    Swedish Match now has an estimated 80 percent of the market for nicotine pouches, which the company sells in different flavors and strengths for about $6 a tin, according to the lawsuit.

    In a statement, Philip Morris, which was not named as a defendant, said, “We believe the plaintiff’s claims are without merit, and we intend to vigorously defend against them.

    Marlboro maker Philip Morris, in 2022, acquired the Swedish tobacco and nicotine products company for $16 billion. Philip Morris has stated an ambition to move away from health-harming cigarettes.

    The consumer lawsuit seeks class action status for Zyn consumers and damages of more than $5 million.

  • Zyn Adds 450 Jobs, $232 Million Investment in Kentucky

    Zyn Adds 450 Jobs, $232 Million Investment in Kentucky

    Credit: PMI

    The expansion will deliver $277 million annually in regional economic impact and increase the plant’s workforce by 40 percent.

    Philip Morris International’s Swedish Match affiliate is announcing an investment of $232 million to expand the production capacity of its manufacturing facility in Owensboro, Kentucky.

    The expansion is expected to create an additional 450 direct jobs with an ongoing annual economic impact of $277 million and 410 indirect jobs for the Commonwealth of Kentucky. The facility produces ZYN nicotine pouches to help meet the growing demand from legal-age consumers switching from cigarettes or other traditional tobacco products.

    “Philip Morris International’s Swedish Match affiliate has been an important partner and job creator in this region for many years, and I’m excited to see this incredible new investment and the 450 great job opportunities it is creating for families in Owensboro and the surrounding region.”

    Kentucky Gov. Andy Beshear

    “Philip Morris International’s Swedish Match affiliate has been an important partner and job creator in this region for many years, and I’m excited to see this incredible new investment and the 450 great job opportunities it is creating for families in Owensboro and the surrounding region,” Kentucky Gov. Andy Beshear said. “Our economy continues to set records, and today’s announcement shows we’re bringing jobs to our people instead making our people move to the jobs. I want to thank and congratulate company leadership for doubling down here in the Commonwealth and look forward to many more years of prosperity.”

    Construction of the expanded facility is already underway, including adding more production space. Progressive production increases are expected during the project, which is targeted for completion by the second quarter of 2025. The construction phase alone is expected to create nearly 2,800 jobs and have an economic impact of about $414 million.

    Career opportunities at the facility cover a wide range of skill levels, including positions such as engineers, production staff, technicians, and quality control. Career opportunities can be found here.

    In addition to facility expansion and ongoing optimization of processes to increase capacity progressively over the coming quarters, the Kentucky facility will move from a 24-hour, five-days-per-week schedule to a 24-hour, seven-days-per-week schedule to boost production starting in the fourth quarter of this year.

    The Swedish Match Owensboro facility currently has about 1,100 employees. The ongoing expansion of the facility in Kentucky is expected to provide around 900 million cans of capacity by 2025.

    In July, PMI announced an investment of $600 million over the next two years through its U.S. affiliate to open a nicotine pouch manufacturing facility in Aurora, Colo. The Aurora facility and Owensboro expansion are designed to provide the capacity needed in the near and mid-term to meet ZYN’s current growth rate with U.S. legal-age nicotine consumers.

  • PMI to Invest Millions in Colorado Zyn Production

    PMI to Invest Millions in Colorado Zyn Production

    Photo: PMI

    Philip Morris International will invest $600 million in a factory in Aurora, Colorado, to help meet U.S. consumers’ growing appetite for the company’s Zyn nicotine pouches. The factory is poised to begin operations by the end of 2025 with regular production starting in 2026.

    “PMI and its U.S. affiliates are accelerating their mission to move adults who smoke away from cigarettes in the U.S. by investing in new U.S. manufacturing capacity to meet the increasing demand for nicotine options that are scientifically substantiated as better alternatives,” said PMI Americas President and U.S. CEO Stacey Kennedy in a statement.

    “We believe Colorado is likeminded in its commitment to innovation, economic opportunity and public health, and we’re eager to work with the state and its talented workforce as we expand our U.S. manufacturing presence.”

    Sales of Zyn jumped 80 percent in the first quarter, leaving PMI struggling to keep up with demand. Retail stores have been experiencing Zyn shortages, with some even limiting the number of cans customers can buy each month.

    Supply was further constrained after the company decided to halt online sales nationwide in June following a subpoena in the District of Columbia asking for information on the sale of flavored pouch products that are banned there.

    PMI is also increasing production of Zyn at its factory in Owensboro, Kentucky. In addition to meeting U.S. demand, the investments will also help create capacity for exports, according to PMI.

    Zyn accounted for more than 70 percent of the $8.6 billion nicotine pouch market in 2023, according to sources. Given the relatively young age of the category, there is little brand loyalty, and analysts believe continued supply constraints may prompt some consumers to defect to other brands.

  • PMI Suspends Online Zyn Sales Due to DC Probe

    PMI Suspends Online Zyn Sales Due to DC Probe

    Photo: Swedish MAtch

    Philip Morris International halted sales of Zyn nicotine pouches on its U.S. website as Washington, D.C., officials investigate the company’s compliance with the district’s ban on the sale of flavored tobacco products, reports The Wall Street Journal.

    On June 17, the company’s Swedish Match North America division announced it had received a subpoena from the District of Columbia’s attorney general, requesting among other things information about the unit’s compliance with local restrictions on flavored tobacco.

    A preliminary investigation by the company indicated that there had indeed been sales of flavored nicotine pouch products in the district. According to PMI, these related predominantly to certain online sales platforms and some independent retailers.

    Swedish Match is currently conducting a full review of its sales and supply chain arrangement in D.C. and other U.S. localities where flavor bans apply.

    Pending the investigation, PMI has suspended all online sales on Zyn.com. Sales on this platform have represented “a very small” percentage of the company’s U.S. Zyn volumes, according to PMI.

    In the March quarter, Philip Morris’ shipment volumes of oral smoke-free product volumes surged by 40 percent, mainly driven by Zyn nicotine pouches in the U.S., where shipment volume reached 131.6 million cans.

    Zyn has been available in the U.S. since 2014, but its sales have skyrocketed over the past year and a half, and its parent company is investing in Zyn capacity in the U.S.

    Philip Morris bought Swedish Match in a $16 billion deal in 2022 as the company looked to reduce its reliance on cigarettes amid stricter regulations and a consumer shift toward alternatives to tobacco and traditional cigarettes.

  • PMI Sees IQOS Surpass Marlboro Brand in Revenue

    PMI Sees IQOS Surpass Marlboro Brand in Revenue

    Photo: Arkadiusz Fajer

    Philip Morris International reported net revenues of $9.05 billion for the fourth quarter and net revenues of $35.17 billion for fiscal year that ended Dec. 31, 2023. On a reported basis, the figures were up 11 percent and 10.7 percent, respectively, over the comparable 2022 periods.

    Performance was driven by revenue growth in both the combustible cigarette business, where pricing offset reduced volumes, and the company’s smoke-free operations, which continued to increase their share of the company’s business mix.

    “We are pleased that smoke-free products reached nearly 40 percent of our total net revenues and over 40 percent of our gross profit in the fourth quarter,” said PMI CEO Jacek Olczak in a statement.

    “This was led by the continued growth of IQOS, which has now surpassed Marlboro in terms of net revenues, confirming its position as the leading premium nicotine brand less than 10 years from launch. The fourth quarter also marked the first anniversary of our combination with Swedish Match, which delivered very strong results in 2023 driven by the stellar U.S. performance of ZYN.”

    PMI shipped 116.3 million cans of ZYN in the fourth quarter of 2023, representing growth of 78.2 percent versus fourth-quarter 2022 Swedish Match shipments of 65.3 million cans.

    “We are entering 2024 with strong momentum, and we expect it will be another year of excellent performance underpinned by an acceleration in organic smoke-free net revenue and profit growth,” said Olczak.

    PMI also expects to benefit this year from a recent settlement with British American Tobacco that resolves all ongoing patent infringement litigation between the parties related to heated tobacco and vapor products. The deal allows each party to innovate and introduce product iterations.

  • VTA Buys Ads Targeting Senator Over Zyn Comments

    VTA Buys Ads Targeting Senator Over Zyn Comments

    vta-logo-square

    The Vapor Technology Association (VTA) announced the launch of a cable news ad buy targeting Sen. Chuck Schumer and his proposed ban on Zyn nicotine pouches. The ad runs this week on FOX News and FOX Business during key programming slots, including “FOX and Friends,” “Kudlow,” and “The Five.”

    Sen. Charles Schumer

    The ad connects a proposed ban on e-cigarettes with a ban on all less harmful, tobacco-free nicotine products, such as Zyn nicotine pouches. The ad also calls out entrenched bureaucrats at the Food and Drug Administration’s Center for Tobacco Products (CTP), led by Brian King, for repeatedly blocking access for millions to e-cigarettes as harm reduction tools that the science has proven are the most effective product on the market to help people quit smoking cigarettes, according to an emailed press release.

    “Sen. Schumer and the FDA are simply wrong: wrong on e-cigarettes, wrong on Zyn, and wrong on the science,” said Tony Abboud, executive director of VTA. “Rather than give adult smokers broader access to a greater number of lower-risk alternatives, the FDA and CTP have instead imposed a de facto ban on e-cigarettes – and Zyn is next.”

    The ad states that Schumer’s proposed Zyn ban precisely mimics his attempts to eliminate e-cigarette use nationwide, amounting to an assault on Americans’ personal freedom to choose lower-risk, tobacco-free nicotine products that overwhelming scientific and medical data demonstrates are effective at helping adults quit smoking.

  • VTA Stands up for Lower-Risk Alternatives

    VTA Stands up for Lower-Risk Alternatives

    The Vapor Technology Association (VTA) today announced the launch of a cable news ad buy in the U.S. targeting Senator Chuck Schumer and his proposed ban on Zyn nicotine pouches. The ad runs this week on FOX News and FOX Business during key programming slots, including “FOX and Friends,” “Kudlow,” and “The Five.”

    The ad connects a proposed ban on e-cigarettes with a ban on all less harmful, tobacco-free nicotine products, such as Zyn nicotine pouches. The ad also calls out officials at the Food and Drug Administration’s Center for Tobacco Products (CTP) for repeatedly blocking access for millions of Americans to e-cigarettes as harm reduction tools.

    “Sen. Schumer and the FDA are simply wrong: wrong on e-cigarettes, wrong on Zyn, and wrong on the science,” said Tony Abboud, executive director of VTA, in a statement. “Rather than give adult smokers broader access to a greater number of lower-risk alternatives, the FDA and CTP have instead imposed a de facto ban on e-cigarettes—and Zyn is next.”

    The ad states that Schumer’s proposed Zyn ban mimics his attempts to eliminate e-cigarette use nationwide, amounting to an assault on Americans’ personal freedom to choose lower-risk, tobacco-free nicotine products that overwhelming scientific and medical data demonstrates are effective at helping adults quit smoking.

     “Why is the FDA denying access to a wide range of less harmful alternatives to combustible cigarettes that could otherwise be used by millions of adult smokers trying to quit?” asked Abboud.

    “Cigarettes kill. Rather than even acknowledging the settled science in support of e-cigarettes and other less harmful, tobacco-free nicotine products in recent years, the CTP has instead authorized nearly 900 new cigarettes for Americans’ use—but Sen. Schumer thinks it’s Zyn you need to be worried about.

    “The anti-nicotine FDA and congressional establishment has simply lost its bearings on the strategy of harm reduction, which it applies to every public health crisis, yet refuses to apply to the annual crisis of nearly half a million Americans dying from smoking every single year.”

     “VTA is running this ad buy because Americans deserve to know that less harmful nicotine products exist that can help adult smokers trying to quit. VTA supports Americans’ freedom to choose,” said Abboud.

  • Activists Protest ‘Misguided’ Zyn Pouch Probe

    Activists Protest ‘Misguided’ Zyn Pouch Probe

    Photo: Swedish Match

    U.S. Senate Majority Leader Chuck Schumer’s call on the U.S. Food and Drug Administration and Federal Trade Commission to investigate the marketing practices and health effects of Philip Morris International’s Zyn nicotine pouch brand provoked a backlash among advocates of tobacco harm reduction.

    “The American people have seen this movie before with less harmful e-cigarettes,” said Tony Abboud, executive director of the Vapor Technology Association (VTA).

    “Congressional leaders yell at unelected bureaucrats at the FDA who scurry to remove products from the market that offend their sensibilities—even though those products are less harmful than traditional cigarettes, and have been proven to help people quit smoking deadly cigarettes altogether.

    “These misguided actions deprive American adults of less harmful, non-combustible, and non-tobacco nicotine products that are a proven alternative to combustible cigarettes and that the largest clinical trial in the U.S. has found to cause them to quit smoking even if they have no intention to quit cigarettes.

    “There is already a de-facto ban on e-cigarettes. Sen. Schumer simply wants this ban extended to other products he and the Washington establishment deem undesirable.

    “As with e-cigarettes, Sen. Schumer falsely asserted that Zyn products are popular with younger users. Yet, the National Youth Tobacco Survey data demonstrates that only 1.5 percent of youth have even tried nicotine pouches. When will the federal government stop hiding behind an excuse that has been disproven by their own data? 

    “VTA stands with Zyn, and the makers of modern oral nicotine pouches, in the fight against arbitrary and capricious government action. Because cigarettes remain the No. 1 cause of preventable death and disease in the U.S., VTA insists on broad access to a wide variety of non-combustible products to preserve freedom of choice for adults who want to use nicotine – and to provide access to proven harm-reduction and smoking-cessation options essential for saving American lives.”

    Earlier, Schumer’s call for an investigation prompted PMI to publish a video clarifying its marketing practices.

  • Schumer Wants Crackdown on Zyn Nicotine Pouches

    Schumer Wants Crackdown on Zyn Nicotine Pouches

    Image: Tobacco Reporter archive

    U.S. Senate Majority Leader Chuck Schumer is calling for a crackdown on Zyn nicotine pouches, arguing that the product will be the next “trend in addiction for teens,” according to USA Today. He has asked the U.S. Food and Drug Administration and the Federal Trade Commission to take action on the company’s marketing practices and the product’s health effects.

    “Amid federal action against e-cigs and their grip on young people, a quiet and dangerous alternative has emerged, and it is called Zyn,” said Schumer. “I am delivering a new warning to parents because these nicotine pouches seem to lock their sights on teens and use social media to hook them.”

    “The amount of nicotine is highly addictive, and much more needs to be done to understand and communicate the health risks for young people,” Schumer said.

    Zyn’s parent company said that it both meets and exceeds industry regulations.

    “The FDA remains concerned about any tobacco product that may appeal to youth,” said Brian King, director of the FDA’s Center for Tobacco Products, in response. “The FDA uses a variety of surveillance tools to monitor the evolving tobacco product landscape and to identify emerging threats to public health.”

    King noted that the FDA closely monitors “those in the supply chain for compliance with federal law.”

    “As always, we are committed to holding those accountable who sell unauthorized tobacco products, including those labeled, advertised and/or designed to encourage youth use,” said King.

    The Federal Trade Commission did not comment, noting that it “does not publicly speculate on external requests for investigations or comment on letters from member[s] of Congress,” according to USA Today.