22nd Century Group: Poised for Growth as FDA Mandates Reduced Nicotine Cigarettes

The U.S. Food and Drug Administration (FDA) has taken a significant step towards reducing the harms associated with smoking by proposing a tobacco product standard to mandate reduced nicotine content in cigarettes. This policy, which has cleared review by the U.S. Office of Management and Budget (OMB), aims to drastically reduce nicotine levels in cigarettes, making them less addictive and potentially helping millions of smokers to quit or reduce their nicotine consumption. 22nd Century Group (NASDAQ: XXII), a tobacco products company leading the fight against nicotine, stands ready to support this policy with its VLN branded low nicotine cigarettes.

The FDA's proposal, if implemented, would require all cigarette manufacturers to meet reduced nicotine standards, potentially forcing them to either license XXII's technology or exit the traditional cigarette market. This regulatory shift could create a significant first-mover advantage for XXII, given its existing FDA authorization and commercial infrastructure. However, implementation challenges, potential legal challenges from major tobacco companies, and the timeline for industry-wide adoption remain critical considerations.



With a market cap of just $2.7 million, XXII is uniquely positioned to capitalize on this regulatory shift. The tobacco industry, valued at approximately $100 billion in the U.S., could undergo a fundamental transformation if the mandate is implemented. XXII could potentially capture significant market share through:

1. Direct sales of VLN branded products: As the only company with FDA-authorized reduced nicotine content cigarettes, XXII is well-positioned to capture market share through direct sales of its VLN branded products.
2. Licensing agreements with major tobacco companies: Major tobacco companies may need to license XXII's technology to meet the reduced nicotine standards, providing XXII with additional revenue streams.
3. Contract manufacturing opportunities: XXII's manufacturing capabilities could be leveraged to produce reduced nicotine content cigarettes for other tobacco companies, further expanding its market reach.

The company's strategy to launch additional reduced nicotine products under other brand labels suggests preparation for market expansion, though execution risks and capital requirements for scaling operations remain key considerations.

FDA Reduced Nicotine Content Proposal Indicated to Have Completed OMB Review as of January 3, 2025

FDA Spokesperson Indicates Policy Could Be Among Most Impactful Population-Level Actions in the History of U.S. Tobacco Product Regulation

MOCKSVILLE, N.C., Jan. 13, 2025 (GLOBE NEWSWIRE) -- 22nd Century Group, Inc. (Nasdaq: XXII), a tobacco products company that is leading the fight against nicotine and believes smokers should have a choice about their nicotine consumption, today announced that it stands ready to support the U.S. Food and Drug Administration’s proposed tobacco product standard to mandate reduced nicotine content in cigarettes, which is indicated to have cleared review by the U.S. Office of Management and Budget on January 3, 2025. The proposal is part of a long-standing effort by the FDA to mandate a drastic reduction in the amount of nicotine in cigarettes, a cornerstone goal of public health experts seeking to reduce the harms of smoking and very much in concert with 22nd Century’s VLN branded low nicotine cigarettes.

“OMB clearance marks a major step in moving this policy forward, and we are excited to see further definitive action by the federal government toward making this scientifically backed, non-partisan smoking harm reduction policy a reality,” said Larry Firestone, Chief Executive Officer of 22nd Century Group. “The FDA has openly stated that this could be the most impactful action for the improvement of public health in reducing the widespread and clearly documented harms of smoking.”

“22nd Century has played a pivotal role in the research, development and numerous federally funded clinical studies underpinning this policy, which has been advanced across multiple administrations since 2009, including action under the first Trump administration. We are also the first and only Company to bring an FDA authorized reduced nicotine content cigarette designed specifically to reduce the harms of smoking to market through the commercial launch of our VLN reduced nicotine content cigarettes. We are now working to launch additional products, including additional reduced nicotine content products using our tobacco but under other brand labels and give greater awareness to low nicotine cigarettes as a separate category in the market. This is a key component as part of our drive to expand the distribution of reduced nicotine content cigarettes manufactured by 22nd Century, increase consumer awareness and expand the VLN® footprint.”

About 22nd Century Group, Inc.

22nd Century Group is the pioneering nicotine harm reduction company in the tobacco industry enabling smokers to take control of their nicotine consumption. We created our flagship product, the VLN® cigarette, to give traditional cigarette smokers an authentic and familiar alternative that helps them take control of their nicotine consumption. VLN® cigarettes have 95% less nicotine than the traditional cigarette and have been proven to greatly reduce nicotine consumption. Instead of offering new ways of delivering nicotine to addicted smokers, we offer smokers the option to take control of their nicotine consumption and make informed and more productive choices, including the choice to avoid addictive levels of nicotine altogether.

Our wholly owned subsidiaries include a leading cigarette manufacturer that produces all VLN® products and provides turnkey contract manufacturing for other tobacco brands both domestically and internationally. The 60,000 square foot facility in Mocksville, North Carolina has the capacity to produce more than 45 million cartons of combusted tobacco products annually with additional space for expansion.

Our proprietary reduced nicotine tobacco blends are made possible by comprehensive and patented technologies that regulate nicotine biosynthesis activities in the tobacco plant, resulting in full flavor and high yield with 95% less nicotine. Our extensive patent portfolio has been developed to ensure we have the only low nicotine combustible cigarette in the United States and critical international markets.

VLN® and Helps You Smoke Less® are registered trademarks of 22nd Century Limited LLC.

Learn more at xxiicentury.com, on X (formerly Twitter), on LinkedIn, and on YouTube.

Learn more about VLN® at tryvln.com.

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