Thursday, 26 April 2012

Tobacco company buys e-cig company

Lorillard, the American cigarette manufacturer, has bought the e-cigarette company Blu Ecigs for $135 million.

From their press release...
blu ecigs is extremely proud and excited to announce today our acquisition by one of the largest and oldest companies in America, Lorillard, Inc. Lorillard, through its Lorillard Tobacco Company subsidiary, is the third-largest manufacturer of cigarettes in the U.S and has a long and proud tradition that will compliment the passion of blu ecigs in the emerging electronic cigarette category.

“This is a very exciting move for me and my team. I am particularly excited about what this means for the brand and our customers. It gives us access to the tremendously experienced team and resources at Lorillard and will allow us to move to the next level on our expansion and product development."

Lorillard is best known as the US's biggest manufacturer of menthol cigarettes which the FDA has been attempting - but failing - to prohibit. In recent years, RJ Reynolds has bought the snus company Conwood (2006) and the NRT company Niconovum (2009). British American Tobacco has since set up a company which will sell a yet-to-be-announced reduced harm nicotine product (Nicoventures, 2011). This all suggests that Big Tabs hopes to shift the market towards low risk substitutes.

The Lorillard buy-out is good news, especially if they pump serious money into developing better products. I've said before that e-cigarettes can replicate the sensation of smoking very well but there's room for improvement when it comes to taste (at least to these lips, many thousands of people disagree). I fully expect e-cigarettes to come on leaps and bounds in the next few years unless they are suppressed by the prohibitionists.

Speaking of the devil, as I do, the down-side of this acquisition is that it will enable the pro-death wing of the anti-smoking movement to portray those of us who favour a market-driven shift towards low/zero-risk nicotine products as being stooges of Big Baccy. But since they do that already and always will, it's probably best to ignore their squealing and get on with doing what they have never done, ie. providing realistic alternatives for people who like nicotine but who want to quit smoking, while leaving the rest of us alone.

10 comments:

Anonymous said...

It's about time. With more money devoted to proper R&D ecigs could probably be made nearly the same as regular cigs as far as taste and feel of the product goes and with some big established companies invested into ecig technology, they might actually standardize things so it's not such a hodge-podge of incompatible parts and pieces that sometimes work in combination and in others, won't even screw together nor are compatible. Will be interesting to see if anything comes of it or if it's tobacco companies start buying up ecig companies in order to suppress instead of expand the technology.

Jonathan Bagley said...

That anti tobacco can now point to the involvement of Big Tobacco in the ecig market could well make regulation (massive price increases) more likely. I don't think this is good development. I think ecigs will improve without tobacco company investment.

Steve K said...

I've kinda shared my hesitation to embrace this new era elsewhere. But, something that's been brought up a few times to me...

What's to keep the tobacco companies, once everything quiets down on the regulation front, from adding "secial" ingredients to the e-liquid used in e-cigarettes?

Pat Nurse MA said...

I hope this isn't a sign that tobacco companies are going to abandon those of us who enjoy real tobacco over a lifetime and force us to use E-Cigs or quit.

Steve K - if that worries you and you don't trust the product you are being asked to buy then don't buy it instead of spreading yet more myths and scaremongering about what Big Bad Tobacco "might" do.

Anonymous said...

@Steve, you could always use your own liquids.

In my opinion, it seems there is no evidence the additives ever had much relevance to the harms of smoking. If that were the case, antitobacco would have to concede that smoking additive free tobacco would be safer or less addictive and frankly I don't think there's any evidence of that either.

jredheadgirl said...

"But since they do that already and always will, it's probably best to ignore their squealing and get on with doing what they have never done.."

Well said Chris!!

I look forward to the day where there is an e-cig that doesn't rip my throat apart. There's no doubt in my mind that there will someday (hopefully sooner, rather than later)be several reduced risk products, all with varying levels of risk, available on the market. Progress needs to be made. Like you have so eloquently pointed out, this may be a step in the right direction.

jredheadgirl said...

..One more thing...:-)

I am with Pat in the sense that I hope that combustible cigarettes will continue to be a main part of the overall focus with regards to harm reduction. Many of us simply do not like e-cigarettes..or snus, etc..

For example, scientists from Cornell university have developed a cigarette with lycopene and resveratrol added to the filter. The result was an astounding 70% + reduction in carcinogenic activity. Similar studies have been done with pine bark and turmeric. This is something that we all deserve to know about. ALL paths towards the ultimate goal of harm reduction should be explored (in my humble opinion). In fact, I believe that it is our right to have access to such products, so long as there is someone willing to sell them.

Jonathan Bagley said...

Interesting Juliette. If such a cigarette goes into production, it would surely be unethical to ban it's sale; just as the ban on snus sales in the EU is unethical. Most people wouldn't advocate banning aspirin, even though it hastens death in a smoll number of cases.

kingkinu said...

Lorillard? The company has been in business for 250 years and has shown profit and growth during its entire tenure. It is not the biggest, but it doesn't strive to be. It is a no nonsense company that does the best it can in a challenging industry. The requirements are challenging, but not overly excessive.
The industry continues to shrink and this might limit mobility. However, the company does not "binge and purge," which means the company expansion is consistent with market conditions. The federal government will continue to have a larger role in this industry, but difficult to say how much and how that will affect employees.
@Kingkinu from Alex ecigs reviews

jessica robert said...

The Electronic Cigarettes business is not as easy in a local location. Online seems to attract a nice customer base with enough advertising, great price, and good customer service.