5 Highlights From Smoker Friendly Conference
By Angel Abcede on Aug. 26, 2019BROOMFIELD, Colo. — Acronyms including IQOS, CBDs and the ever-present FDA drew much attention at the recent Smoker Friendly conference and tobacco festival in Broomfield, Colo., with manufacturers and retailers assessing the near-term and long-term outlook for the category.
Officials with the National Association of Tobacco Outlets (NATO) contributed to the event with a half-day seminar the morning of Aug. 22, which included tobacco analysts and researchers. At that seminar, speakers focused on product sales and movement data, as well as predictions about emerging products such as New York-based Philip Morris’ heat-not-burn device IQOS and the fast-evolving area of cannabidiol (CBD) products.
Here are a few of highlights from those discussions …
IQOS anticipation
With Richmond, Va.-based Altria Group having received authorization from the U.S. Food and Drug Administration (FDA) to market and sell IQOS in the United States, Judy Hong, managing director of Goldman Sachs, New York, said anticipation is running high among retailers as Altria prepares for initial testing in the Atlanta market.
She raised the idea of how IQOS would compare to the established success of the e-cigarette brand Juul. With San Francisco-based Juul just launching internationally and IQOS bringing the success it has had in several countries outside the United States, Hong said, “It’s not a zero-sum game.”
With global penetration for these products in the single digits, she said, “There’s a huge pool of consumption that they [both] can go after."
FDA update
Providing a regulatory update, Tom Briant, executive director of Lakeville, Minn.-based NATO, said that in the case of FDA deadlines for premarket tobacco applications (PMTAs), the FDA has changed the final date five times in recent years due in part to litigation.
The most recently set deadlines for manufacturers to submit PMTAs is May 11, 2020, but a new lawsuit is asking a federal court to move that deadline yet again. In that lawsuit filed Aug. 14, the Vapor Technology Association (VTA), Washington, alleges that the FDA set the May 2020 deadline in response to a federal court’s direction that did not involve proposing the new deadline through the required rulemaking process under the law.
“The VTA asked the court to let the FDA file a new guidance to fully explain what needs to be included in a completed PMTA application, as the current guidance did not provide all the information needed,” Briant said at the Aug. 22 seminar. “Let the FDA finish its guidance document, then change the May 2020 deadline to a reasonable date in future. Otherwise the deadline will be here and products will have to come off the market.”
Briant also said the FDA’s recently produced draft guidance on graphic warning labels may see challenges in the courts because the FDA’s first set of graphic cigarette health warnings proposed in 2010 were struck down as a result of a manufacturer lawsuit. The new proposed warning labels mirror European paradigms, visually depicting the illnesses that can result from habitual tobacco use.
Tobacco, CBD users overlap
On the emerging category of CBDs, Don Burke, senior vice president of Management Science Associates (MSA), Pittsburgh, said the target audience for CBD products are on the younger side, male, childless and liberal, which coincides with much of the tobacco demographic. “The tobacco consumer is highly likely to these [CBD] products vs. typical consumers,” Burke said. “You have that person coming to your store who’s most interested in CBDs.”
From January 2019 to July 2019, MSA recorded a 156% increase in the consumption of CBD products, with dollar sales increasing 208% in the same six months. “That may be stronger than the growth of vaping,” he said.
Hemp farming
With the growing interest in CBD products among retailers, Boulder, Colo.-based Smoker Friendly, which manufactures, distributes and sells tobacco products, has embarked on its own CBD journey, investing in and operating a hemp farm just outside of Broomfield, where it hosted the tobacco conference and festival.
Two buses of conference attendees traveled to the farm, where officials described their growing and manufacturing processes. Many family members who own and operate Smoker Friendly have invested into the Solari Hemp field and its products, as well as its farm-to-shelf concept. Its focus is with on-premise growing, harvesting, extraction, distillation, testing and product development.
A brochure provided to attendees showed an array of hemp isolate products that include tinctures, topicals, drinkable “shots,” soft gels and gummies.
A look at kratom
Similar to the way nutritional supplements made their way into the market years ago and CBD products are maneuvering now, kratom—another type of natural, plant-based remedy—is navigating regulatory and legal hurdles to potentially make its way into convenience stores.
Much in the way hemp, a basic material for CBD products, had to achieve legal status on the federal level, kratom had to avoid classification as a Schedule 1 drug (on par with heroin) in the eyes of the law, said Charles “Mac” Haddow, senior fellow on public policy for the American Kratom Association, Haymarket, Va.
Speaking Aug. 23 at the Smoker Friendly conference, Haddow said his lobbying effort on behalf of the kratom association included addressing multiple FDA assertions in fall 2017 that kratom led to 44 deaths worldwide. By asking for details on each case, Haddow said kratom lobbyists were able to debunk each instance, leading to further discussion over any potential ban on the product.
In one of those cited deaths, Haddow said the person drank tea with kratom but later died of two gunshot wounds. “This is not the way to do the public’s business,” Haddow told about 300 attendees during a morning general session.
Having had similar experiences with nutritional supplements as they made their way to market, Haddow said similar roadblocks exist for kratom, as well as CBDs. Ultimately, the main concerns are adulterated products and those supplied from the black market, he said, noting that the best regulatory solutions protect the public health.