22nd Century Group Announces South Korea as First VLN® International Market

Rhea-AI Summary

22nd Century Group, Inc. (Nasdaq: XXII) announced the upcoming launch of its VLN® reduced nicotine content cigarettes in South Korea's $1.6 billion tobacco market, targeting the high smoking rate in the country. The first revenue from shipments is expected by the end of March 2022. The government of South Korea has been promoting smoking cessation, enhancing the market potential for VLN®. The company is also proceeding to launch in additional Asian and European markets while leveraging its MRTP authorization in the U.S. to establish a foothold in the $80 billion tobacco market.

Positive

• First revenue from VLN® cigarette shipments expected by March 2022.
• Launch in South Korea aligned with government efforts to reduce smoking rates.
• Expansion plans into additional Asian and European markets.

Negative

• None.

First revenue from shipment to in-market partner expected by end of March 2022

BUFFALO, N.Y., Feb. 28, 2022 (GLOBE NEWSWIRE) -- 22nd Century Group, Inc. (Nasdaq: XXII), a leading agricultural biotechnology company focused on tobacco harm reduction, reduced nicotine tobacco, and improving health and wellness through modern plant science, today announced the $1.6 billion¹ South Korean tobacco market will be the first international market to commence sales of its VLN^® reduced nicotine content cigarettes.

“South Korea is an ideal international launch market in many ways, with a high smoking rate among developed countries and a government strongly committed to smoking harm reduction. We expect the first sale of VLN^® reduced nicotine content cigarettes to our South Korean partner to occur by the end of March,” said James A. Mish, Chief Executive Officer.

“Approximately one in three adult men in South Korea² are smokers, and an estimated 6% of adult women smoke. The government has worked over the past two decades to promote smoking cessation through a variety of means, including heightened tobacco prices, and remains committed to advancing alternative products to help curb smoking activity in the country. We are excited to make VLN^® reduced nicotine content products available in South Korea to help break the nicotine addiction cycle and support this important effort.”

The Company will continue its launch process in additional markets in Asia and Europe with limited regulatory barriers while also leveraging VLN^®’s MRTP authorization toward seeking approval in additional markets with higher regulatory barriers. In addition to its first international launch of VLN^® reduced nicotine content cigarettes in the more than $800 billion global tobacco market, 22nd Century Group is actively moving forward to launch VLN^® in the $80 billion U.S. tobacco market. The U.S. FDA authorized 22nd Century’s VLN^® reduced nicotine content cigarette products on December 23, 2021. The Company is currently executing its 90-day post-authorization plan to launch in its first U.S. pilot market.

In its MRTP authorization press release for 22nd Century’s VLN^® King and VLN^® Menthol King cigarettes, the FDA stated, “We know that three out of four adult smokers want to quit and the data on these products show they can help addicted adult smokers transition away from highly addictive combusted cigarettes.”

About VLN^®
VLN^® is the first and only FDA MRTP authorized combustible cigarette. Utilizing 22nd Century’s proprietary tobacco plant lines, VLN^® cigarettes smoke, smell, and taste just like a conventional cigarette but contain 95% less nicotine. Numerous independent scientific studies, funded largely by the U.S. Food and Drug Administration, the National Institutes of Health, and other U.S. federal government agencies, have demonstrated that using reduced nicotine content tobacco cigarettes like VLN^® helps smokers reduce their nicotine exposure and dependence, smoke fewer cigarettes per day, increase their number of smoke-free days, and double their quit attempts – all with minimal or no nicotine withdrawal symptoms or compensatory smoking behavior. VLN^® helps you smoke less. Learn more at tryVLN.com. 

About 22nd Century Group, Inc.
22nd Century Group, Inc. (Nasdaq: XXII) is a leading agricultural biotechnology company focused on tobacco harm reduction, reduced nicotine tobacco and improving health and wellness through plant science. With dozens of patents allowing it to control nicotine biosynthesis in the tobacco plant, the Company has developed proprietary reduced nicotine content (RNC) tobacco plants and cigarettes, which have become the cornerstone of the FDA’s Comprehensive Plan to address the widespread death and disease caused by smoking. The Company received the first and only FDA MRTP authorization of a combustible cigarette in December 2021. In tobacco, hemp/cannabis, and hop plants, 22nd Century uses modern plant breeding technologies, including genetic engineering, gene-editing, and molecular breeding to deliver solutions for the life science and consumer products industries by creating new, proprietary plants with optimized alkaloid and flavonoid profiles as well as improved yields and valuable agronomic traits.

Learn more at xxiicentury.com, on Twitter @_xxiicentury, and on LinkedIn.

Cautionary Note Regarding Forward-Looking Statements
Except for historical information, all of the statements, expectations, and assumptions contained in this press release are forward-looking statements. Forward-looking statements typically contain terms such as “anticipate,” “believe,” “consider,” “continue,” “could,” “estimate,” “expect,” “explore,” “foresee,” “goal,” “guidance,” “intend,” “likely,” “may,” “plan,” “potential,” “predict,” “preliminary,” “probable,” “project,” “promising,” “seek,” “should,” “will,” “would,” and similar expressions. Actual results might differ materially from those explicit or implicit in forward-looking statements. Important factors that could cause actual results to differ materially are set forth in “Risk Factors” in the Company’s Annual Report on Form 10-K filed on March 11, 2021. All information provided in this release is as of the date hereof, and the Company assumes no obligation to and does not intend to update these forward-looking statements, except as required by law.

Investor Relations & Media Contact:
Mei Kuo
22nd Century Group, Inc.
Director, Communications & Investor Relations
T: +1-716-300-1221
mkuo@xxiicentury.com

Darrow Associates Investor Relations
Matt Kreps
T: +1-214-597-8200
mkreps@darrowir.com

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¹ https://www.statista.com/outlook/cmo/tobacco-products/south-korea
² https://www.statista.com/statistics/645282/south-korea-smoking-rate-by-gender/#:~:text=In%202019%2C%20about%2034.7%20percent,declined%20steadily%20in%20recent%20years.

A photo accompanying this announcement is available at https://www.globenewswire.com/NewsRoom/AttachmentNg/5875eade-e524-411f-930e-283f7a995009

FAQ

What is the significance of the VLN® launch for XXII?

The VLN® launch is significant as it marks the first international market entry for XXII's reduced nicotine cigarettes, expected to generate revenue by March 2022.

When is the first revenue from VLN® expected for XXII?

The first revenue from shipments of VLN® reduced nicotine content cigarettes is expected by the end of March 2022.

Why is South Korea chosen as the first market for VLN® cigarettes?

South Korea was chosen due to its high smoking rates among developed countries and the government's strong commitment to smoking harm reduction.

What is the market potential for VLN® in South Korea?

The South Korean tobacco market is valued at $1.6 billion, making it a significant opportunity for XXII's VLN® cigarettes.

What are the future plans for VLN® after South Korea?

After South Korea, XXII plans to launch VLN® in additional markets across Asia and Europe, taking advantage of limited regulatory barriers.