LONDON and MOORPARK, Calif. — British American Tobacco plc said that the U.S. business of the BAT Group (BAT) has acquired the nicotine pouch product assets of Dryft Sciences LLC, a Moorpark, Calif.-based modern oral nicotine product company.
This acquisition expands BAT’s modern oral portfolio in the United States, growing from four to 28 product variants. It follows the acceptance of Dryft’s recent pre-market tobacco product application (PMTA) submission for filing by the U.S. Food and Drug Administration (FDA).
The enhanced portfolio will include a wider range of nicotine strengths and flavors providing adult nicotine consumers with a greater degree of choice, the company said, covering all key consumer preferences. This will significantly strengthen BAT’s portfolio in a fast-growing nicotine category, it said
BAT will rebrand Dryft’s U.S. portfolio under its global modern oral brand, VELO, and expects to accelerate growth through its distribution, marketing and channel capabilities.
“Today’s announcement underscores our societal commitment to accelerate our transformation and build ‘a better tomorrow.’ Our multi-category strategy is key to our transformation,” said Jack Bowles, CEO of BAT. “The addition of Dryft to our U.S. Velo brand is a major step forward, further enhancing our successful vaping and oral portfolio.”
The company said this acquisition further demonstrates its commitment to reducing the health impact of its global business, which involves committing to providing adult consumers with a wide range of less risky products, continuing to be clear that combustible cigarettes pose serious health risks and that the only way to avoid these risks is not to start or to quit and encouraging those who otherwise continue to smoke to switch completely to scientifically substantiated, reduced-risk alternatives.
“We’re proud of the tremendous momentum we’ve built with Dryft and thrilled that our strong product portfolio will now serve to enhance the Velo brand,” said Jason Carignan, president of DRYFT Sciences. “We remain confident that modern oral innovations like Dryft and Velo will continue to find an adult consumer base seeking alternatives to traditional products.”
BAT also said it will track and share progress of this transformation to accelerate the growth of new-category revenues at a faster rate than its total revenue, reaching $3.84 billion in 2025. Its goal is to reach 50 million consumers of non-combustibles worldwide by 2030.
“The modern oral category in the U.S. is developing rapidly,” said Guy Meldrum, CEO of Reynolds American Inc., Winston-Salem, N.C. “We are excited to expand the portfolio of Velo products to meet the evolving preferences of adult consumers. “We are confident that, leveraging our strong in-market execution capability, the new Velo portfolio will contribute to accelerated growth.”
London-based tobacco company BAT’s non-combustible products are available in more than 50 countries.