Charlie's Holdings (OTCQB:CHUC) Developing Patented "Age-Gating" Technology to Address FDA's Concerns over Youth Access to E-Cigarettes

Rhea-AI Summary

Charlie's Holdings (OTCQB:CHUC) is pioneering patented age-gating technology aimed at controlling access to flavored e-cigarettes. This initiative, led by expert Dr. Edward Carmines, seeks FDA recognition as a 'product of merit' to legally market these products in the $7 billion U.S. market while preventing underage access. Engaging Fish & Richardson for patent development, Charlie's aims to align with FDA regulations, positioning its PACHA™ disposable e-cigarettes as potential market leaders. The push comes at a time of heightened scrutiny on e-cigarette sales, following Juul Labs' $1.2 billion settlement related to youth vaping issues.

Positive

• Development of patented age-gating technology could position Charlie's e-cigarettes as one of the few flavored products legally marketable in the U.S.
• Expert leadership from Dr. Edward Carmines enhances credibility in navigating FDA regulations.
• Engagement of top patent law firm Fish & Richardson strengthens the company's intellectual property strategy.

Negative

• The e-cigarette industry faces significant regulatory scrutiny, with many products receiving Marketing Denial Orders from the FDA.
• The ongoing risk of litigation and regulatory challenges related to youth vaping remains high.

Edward Carmines, Ph.D., member of Charlie's Board of Directors and accomplished scientist and regulatory affairs expert, is spearheading Charlie's development of patented "age-gating technology" for Charlie's and potential licensees of the Company.

Charlie's seeks to develop what the FDA may recognize as a "product of merit" so that the Agency could allow the Company and its licensees to market flavored Electronic Nicotine Delivery System ("ENDS") products to adult consumers across the United States.

Aiming to prevent underage access in the $7 billion U.S. e-cigarette market, Charlie's has engaged Fish & Richardson, one of the largest patent law firms in the world, to expand the Company's intellectual property portfolio with key "age-gating" patents.

COSTA MESA, CA / ACCESSWIRE / January 25, 2023 / Charlie's Holdings, Inc. (OTCQB:CHUC) ("Charlie's" or the "Company"), an industry leader in the premium, nicotine-based, vapor products space, today announced a new strategic imperative: developing patented "age-gating" technology to address significant concerns raised by U.S. Food and Drug Administration ("FDA") over the use of Electronic Nicotine Delivery System ("ENDS") products by underage consumers. Charlie's is determined to address this issue. If the Company's "age-gated" nicotine disposable e-cigarettes-in-development are recognized as "products of merit" by the FDA, Charlie's e-cigarettes could emerge among the select minority of flavored e-cigarettes able to be sold legally in the $7 billion U.S. market.

Project leader, Dr. Edward Carmines, is a world-renowned expert in the technical aspects of all types of e-cigarettes, oral tobacco, tobacco-free products, cigars, and cigarettes. Having successfully navigated the FDA's Substantial Equivalence, Premarket Tobacco Application ("PMTA") and Modified Risk Tobacco Product Application ("MRTPA") pathways for literally hundreds of products, Dr. Carmines is developing proprietary technology with Charlie's Research and Development team to enable the Company, upon receipt of an FDA marketing order, to offer a controlled e-cigarette device that is made operable only upon activation by an age-verified adult consumer.

By launching this strategic initiative, Charlie's has endeavored to make the Company's PACHA™ disposable e-cigarette products among the select few - or the only - flavored e-cigarettes able to be sold legally in the United States.

"It is universally acknowledged that adult smokers in the United States who wish to stop using combustible cigarettes show an overwhelming preference for flavored products," explained Dr. Carmines. "However, public health officials and the FDA believe that flavored ENDS products are preferred by the majority of underage ENDS product users as well. Herein lays the greatest challenge - and the greatest opportunity - for the e-cigarette industry."

Charlie's patent-pending technology employs a proprietary "smart activation manager and user verification service." The Company's novel e-cigarette may only be activated after a proprietary "age-gating" technology and procedure enable an age-verified adult consumer to operate the device. In order to pursue the Company's "age-gating" and related Intellectual Property patent initiatives, Charlie's has engaged Fish & Richardson, one of the largest patent law firms in the world.

"At a time when the FDA has issued thousands of Marketing Denial Orders for countless flavored electronic nicotine delivery system products, and Refuse-to-File letters for many millions of other products, we believe the time has come for the proactive development of a truly game-changing solution to the problem of underage vaping," explained Ryan Stump, Chief Operating Officer of Charlie's Holdings, Inc. "In this light, we believe our proprietary 'age-gating' technology will, indeed, enable Charlie's PACHA flavored nicotine e-cigarettes to meet the FDA's statutory standard of 'appropriate for the protection of the public health.'"

"In December, Juul Labs agreed to pay $1.2 billion to resolve approximately 10,000 lawsuits targeting the e-cigarette maker as a major cause of the U.S. youth-vaping epidemic," said Henry Sicignano, Charlie's President. "On the other hand, keeping tobacco products out of the hands of youth is a top priority for the FDA and for Charlie's. Charlie's substantial investments in ‘age-gating' technologies will prevent youth access to e-cigarette products… and, in so doing, will create lucrative sales and licensing opportunities for our Company."

About Charlie's Holdings, Inc.

Charlie's Holdings, Inc. (OTCQBCHUC) is an industry leader in the premium, nicotine-based, vapor products space. The Company's products are sold around the world to select distributors, specialty retailers, and third-party online resellers through subsidiary companies Charlie's Chalk Dust, LLC and Don Polly, LLC. Charlie's Chalk Dust, LLC has developed an extensive portfolio of brand styles, flavor profiles, and innovative product formats. Don Polly, LLC creates innovative hemp-derived products and brands.

For additional information, please visit Charlie's corporate website at: Chuc.com and the Company's branded online websites: CharliesChalkDust.com, Pacha.co, and Pinweel.com.

Safe Harbor Statement

This press release contains "forward-looking statements" within the meaning of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995, including but not limited to statements regarding the Company's overall business, existing and anticipated markets and expectations regarding future sales and expenses. Words such as "expect," "anticipate," "should," "believe," "target," "project," "goals," "estimate," "potential," "predict," "may," "will," "could," "intend," variations of these terms or the negative of these terms, and similar expressions, are intended to identify these forward-looking statements. Forward-looking statements are subject to a number of risks and uncertainties, many of which involve factors or circumstances that are beyond the Company's control. The Company's actual results could differ materially from those stated or implied in forward-looking statements due to a number of factors, including but not limited to: the Company's ongoing ability to quote its shares on the OTCQB; whether the Company will meet the requirements to uplist to a national securities exchange in the future; the Company's ability to successfully increase sales and enter new markets; whether the Company's PMTA's will be granted marketing orders by the FDA, and the FDA's decisions with respect to the Company's future PMTA submissions; the Company's ability to manufacture and produce products for its customers; the Company's ability to formulate new products; the acceptance of existing and future products; the complexity, expense and time associated with compliance with government rules and regulations affecting nicotine, synthetic nicotine, and products containing cannabidiol; litigation risks from the use of the Company's products; risks of government regulations, including recent regulation of synthetic nicotine; the impact of competitive products; and the Company's ability to maintain and enhance its brands, as well as other risk factors included in the Company's most recent quarterly report on Form 10-Q, annual report on Form 10-K, and other SEC filings. These forward-looking statements are made as of the date of this press release and were based on current expectations, estimates, forecasts and projections as well as the beliefs and assumptions of management. Except as required by law, the Company undertakes no duty or obligation to update any forward-looking statements contained in this release as a result of new information, future events or changes in its expectations.

Investors Contact:

IR@charliesholdings.com
Phone: 949-570-0691

SOURCE: Charlie's Holdings, Inc.

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FAQ

What is Charlie's Holdings (CHUC) focusing on?

Charlie's Holdings is developing patented age-gating technology to control access to flavored e-cigarettes and aims for FDA recognition as a 'product of merit'.

Who is leading the age-gating technology initiative at Charlie's Holdings?

Dr. Edward Carmines, an expert in the field, is spearheading the development of age-gating technology at Charlie's Holdings.

What potential market does Charlie's Holdings target with its age-gating technology?

Charlie's Holdings targets the $7 billion U.S. e-cigarette market with its age-gating technology.

Why is Charlie's Holdings developing age-gating technology?

The age-gating technology aims to prevent underage access to e-cigarettes and meet FDA regulations.