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Tag: Philip Morris International

  • Mass production of ZYN nicotine pouches now underway in Aurora

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    Philip Morris International has begun ramping up production of its increasingly popular ZYN nicotine pouches at a new factory in Aurora, south of Denver International Airport.

    PMI markets ZYN pouches as a much cleaner and safer method for obtaining nicotine than smoking cigarettes or chewing tobacco, although FDA restrictions prevent the company from marketing its pouches as a smoking cessation product.

    In January 2025, the Food and Drug Administration authorized ZYN as the first nicotine pouch cleared for marketing in the U.S, stating it is “appropriate for the protection of public health.” But the FDA didn’t “approve” the pouches, given that it still considers all nicotine products harmful and potentially addictive.

    Instead, the company uses terms like “no smoke,” “no spitting,” and “no tobacco leaf.” That last term is key.

    Brian Erkkila, PMI’s senior adviser of scientific engagement, said that smoking remains the leading preventable cause of death and disease in the U.S. Nearly 30 million Americans continue to smoke, and each year, 500,000 people die from cigarette smoking.

    Smokers expose themselves to 1,000-plus compounds and carcinogens every time they light up. Some of the most damaging items on that long list are carbon monoxide, polycyclic aromatic hydrocarbons, nitrosamines, formaldehyde, benzene, acrolein, hydrogen cyanide and ammonia.

    The dangerous compounds are a leading cause of multiple cancers, including lung, mouth, throat, and esophageal. Smoking contributes to a variety of cardiovascular diseases and is the primary cause of bronchitis, emphysema and reduced lung function. The nicotine addiction is so compelling that smokers make a dangerous trade-off, shortening their lives and harming those around them.

    Enter the ZYN pouches, which come in 6-milligram and 3-milligram sizes. Flavors include Chill, Menthol, Cinnamon, Peppermint, Citrus, Smooth, Coffee, Spearmint, Cool Mint and Wintergreen. Users typically ingest four or more a day, tucking a pouch in between the upper or lower lip and gums.

    The pouches contain pharmaceutical-grade nicotine, extracted from tobacco leaves but without the toxins. The nicotine, which is shipped to the Aurora plant, is mixed with a proprietary plant-based filler and flavorings and then piped down to the factory floor. Rows of machines place it into small pouches, which are weighed and scanned to ensure they have the right content. Fifteen pouches are placed into a can. Cans are stacked in groups of five, wrapped and eventually placed into boxes for shipping to retailers.

    The process is fairly straightforward and largely automated. Workers monitor the machines and the conveyor lines to make sure things are flowing smoothly, but they aren’t stuck with repetitive motions for hours on end. Quality control workers dart in and out to grab product samples for frequent quality control tests.

    Production and worker training are underway in the completed sections as 800 construction workers push hard to finish the remaining sections at the 600,000-square-foot facility. Between capital spending and construction wages, PMI, through its Swedish Match subsidiary, will invest about $1 billion in the Aurora plant.

    Aurora will provide $7.1 million in tax rebates to PMI, while the Colorado Economic Development Commission approved $4.5 million in Job Growth Incentive Tax Credits and Adams County has agreed to chip in another $4.3 million in incentives.

    The company has hired about 120 of the 500 workers it plans to eventually employ in Aurora, which is the location of its second U.S. ZYN plant after one in Owensboro, Ky.  An online portal is available for those interested in applying for a position. The average wage is expected to be $90,000 a year.

    The project has come together quickly since it was announced in July 2024, a rapid schedule driven by soaring demand. ZYN sales have grown by triple-digit rates in recent years, and the brand now accounts for an estimated 70% to 80% of nicotine pouches sold in the U.S.

    ZYN pouches, and the plant itself, are not without opposition.

    Public health officials argue that switching to alternative delivery methods for nicotine, even ones with fewer toxic compounds, doesn’t address the core issue of addiction. In the debate between harm reduction versus abstinence, they argue that the latter is both achievable and the only genuine solution.

    Even in its purest form, nicotine comes with cardiovascular impacts, including an increased heart rate, temporary rises in blood pressure and constriction of blood vessels. Nicotine pouches are relatively new, meaning long-term impacts are still to be determined.

    Users who don’t stop smoking can find themselves in worse shape than when they started using pouches, warned Arnold Levinson, a clinical professor and professor emeritus in the Department of Community and Behavioral Health at the University of Colorado School of Public Health.

    “If you want to quit smoking, don’t think you’ll do it by ‘switching’ to ZYN – you’re likely get hooked on ZYN but keep smoking anyway,” said Levinson, who has done extensive research on tobacco use and smoking cessation and has played an important role in shaping the state’s tobacco policies.

    A container of ZYN nicotine pouches at the office of Phillip Morris International’s facility in Aurora on Tuesday, Feb. 3, 2026. (Photo by Hyoung Chang/The Denver Post)

    Erkkila, who is a former lead toxicologist at the FDA’s Center for Tobacco Products, counters that half of ZYN users no longer smoke and many of the remainder smoke less.

    “People do move away from cigarettes in a meaningful way,” he said.

    ZYN pouches offer a slower nicotine absorption rate, which results in lower dopamine spikes. Pouches also come with fewer “habit loops,” such as lighting up, inhaling, and grinding down a stub, and they are less ritualistic and social in their usage.

    Luke Niforatos, executive vice president of Smart Approaches to Marijuana, an advocacy group based in Washington, D.C., said pouches are “extremely addictive, given their high nicotine content, and bear risks for cardiovascular and oral health.”

    The public health community is especially worried about the impacts on underage users and young adults, he said. He and Levinson both argue that efforts to limit those under 21 from purchasing and using tobacco products are far from foolproof and safeguards are often circumvented.

    Underage users may view pouches as a “healthier” and harder-to-detect way to get a nicotine buzz. And as with vaping products, flavors tend to have a greater pull on younger users. Denver voters, by a wide margin, banned the sale of flavored nicotine products in November. The law took effect at the start of the year, meaning most of the ZYN product lines won’t be available in the city.

    “No one has ever kept kids from getting tobacco products — ZYN is another path to nicotine addiction and health problems for young people. The investment in ZYN manufacturing would have been much better spent elsewhere,” Levinson said.

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  • Meet the Suspicious 8: Dividends Over 6% With Plenty of Problems

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    Meet the Suspicious 8: Dividends Over 6% With Plenty of Problems

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  • FDA urges child-resistant packaging for nicotine pouches

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    The U.S. Food and Drug Administration is urging nicotine pouch manufacturers to use child-resistant packaging on their products. This comes as a rise in nicotine pouch exposure cases has been reported among young children – with some causing nicotine poisoning.In an announcement Tuesday, the FDA called on manufacturers to use child-resistant packaging to reduce the risk of these “accidental” and “harmful” exposures.”I am concerned about rising reports of nicotine exposures in young children caused by nicotine pouches,” FDA Commissioner Dr. Marty Makary said in the announcement. “The fruity flavors and bright, colorful designs of nicotine pouch products could resemble candy and seem attractive to children. Manufacturers should consider what steps they can take to prevent accidental exposures and ingestion.”The FDA noted in its announcement that it has authorized 20 nicotine pouch products, all of which use child-resistant packaging. The FDA gave marketing authorization to certain nicotine pouches for the first time in January.”ZYN is the only nicotine pouch authorized by the FDA as appropriate to protect public health. In making that conclusion the agency noted that ZYN’s packaging is designed to be child resistant – and has been since its launch 11 years ago,” Philip Morris International, which owns nicotine pouch brand Zyn, said in a statement Tuesday.But several brands of pouches on the market have not received FDA authorization, and not all have child-resistant packaging.The FDA urged manufacturers to contact the agency if they have a pending premarket application for a nicotine pouch product and intend to incorporate child-resistant packaging or other measures to mitigate the risk of accidental exposure to children.Nicotine pouches are small packets, filled with a powder made of nicotine, flavorings and other ingredients, that users can tuck between their lip and gum, where the nicotine is absorbed through mucous membranes.From April 2022 through March 2025, the number of reported nicotine pouch exposure cases reported to U.S. Poison Centers steadily climbed, according to the FDA, and about 72% were in children younger than 5.The FDA warned in its announcement that the concentrated nicotine in these products can be harmful or potentially fatal to young children, even in small amounts. In young children, ingestion of doses as low as 1 to 4 milligrams of nicotine has been associated with “toxic effects,” according to the FDA.Symptoms of nicotine poisoning can include abdominal cramps, confusion, seizures, loss of consciousness, headache and vomiting.The FDA offered information for consumers in its announcement on how to properly store nicotine pouches and prevent accidental exposure to children.”Parents and caregivers should safely store all nicotine products, including pouches, in secure locations away from children in original packaging and seek immediate medical attention if accidental ingestion occurs,” the agency said. And if anyone of any age eats a nicotine pouch, accidental or not, the best first step is to immediately call Poison Control at 1-800-222-1222.”The recent rise in accidental exposure to nicotine pouches is deeply troubling, especially when it involves our youngest and most at risk,” Kathy Crosby, CEO and president at the Truth Initiative, a nonprofit focused on preventing youth and young adult nicotine addiction, said in a statement.”To help safeguard young people from the preventable harms of these products, it’s critical for manufacturers to prioritize child-resistant packaging and that the FDA consider risks of accidental exposure and packaging safety when reviewing new products,” Crosby said. “The FDA can also immediately reduce the likelihood of accidental exposure by ensuring that only authorized products are on store shelves.”Nicotine pouches have become the second most-used nicotine product among young people, according to the US Centers for Disease Control and Prevention.A report released Thursday by the Truth Initiative says that oral nicotine pouch use among high school students has nearly doubled, increasing from 1.3% in 2023 to 2.4% in 2024.Still, the overall user base remains small. Just 0.5% of Americans use nicotine pouches, compared with 9% who smoke cigarettes and 3% who vape or use e-cigarettes, according to U.S. Census Bureau data.

    The U.S. Food and Drug Administration is urging nicotine pouch manufacturers to use child-resistant packaging on their products. This comes as a rise in nicotine pouch exposure cases has been reported among young children – with some causing nicotine poisoning.

    In an announcement Tuesday, the FDA called on manufacturers to use child-resistant packaging to reduce the risk of these “accidental” and “harmful” exposures.

    “I am concerned about rising reports of nicotine exposures in young children caused by nicotine pouches,” FDA Commissioner Dr. Marty Makary said in the announcement. “The fruity flavors and bright, colorful designs of nicotine pouch products could resemble candy and seem attractive to children. Manufacturers should consider what steps they can take to prevent accidental exposures and ingestion.”

    The FDA noted in its announcement that it has authorized 20 nicotine pouch products, all of which use child-resistant packaging. The FDA gave marketing authorization to certain nicotine pouches for the first time in January.

    ZYN is the only nicotine pouch authorized by the FDA as appropriate to protect public health. In making that conclusion the agency noted that ZYN’s packaging is designed to be child resistant – and has been since its launch 11 years ago,” Philip Morris International, which owns nicotine pouch brand Zyn, said in a statement Tuesday.

    But several brands of pouches on the market have not received FDA authorization, and not all have child-resistant packaging.

    The FDA urged manufacturers to contact the agency if they have a pending premarket application for a nicotine pouch product and intend to incorporate child-resistant packaging or other measures to mitigate the risk of accidental exposure to children.

    Nicotine pouches are small packets, filled with a powder made of nicotine, flavorings and other ingredients, that users can tuck between their lip and gum, where the nicotine is absorbed through mucous membranes.

    From April 2022 through March 2025, the number of reported nicotine pouch exposure cases reported to U.S. Poison Centers steadily climbed, according to the FDA, and about 72% were in children younger than 5.

    The FDA warned in its announcement that the concentrated nicotine in these products can be harmful or potentially fatal to young children, even in small amounts. In young children, ingestion of doses as low as 1 to 4 milligrams of nicotine has been associated with “toxic effects,” according to the FDA.

    Symptoms of nicotine poisoning can include abdominal cramps, confusion, seizures, loss of consciousness, headache and vomiting.

    The FDA offered information for consumers in its announcement on how to properly store nicotine pouches and prevent accidental exposure to children.

    “Parents and caregivers should safely store all nicotine products, including pouches, in secure locations away from children in original packaging and seek immediate medical attention if accidental ingestion occurs,” the agency said. And if anyone of any age eats a nicotine pouch, accidental or not, the best first step is to immediately call Poison Control at 1-800-222-1222.

    “The recent rise in accidental exposure to nicotine pouches is deeply troubling, especially when it involves our youngest and most at risk,” Kathy Crosby, CEO and president at the Truth Initiative, a nonprofit focused on preventing youth and young adult nicotine addiction, said in a statement.

    “To help safeguard young people from the preventable harms of these products, it’s critical for manufacturers to prioritize child-resistant packaging and that the FDA consider risks of accidental exposure and packaging safety when reviewing new products,” Crosby said. “The FDA can also immediately reduce the likelihood of accidental exposure by ensuring that only authorized products are on store shelves.”

    Nicotine pouches have become the second most-used nicotine product among young people, according to the US Centers for Disease Control and Prevention.

    A report released Thursday by the Truth Initiative says that oral nicotine pouch use among high school students has nearly doubled, increasing from 1.3% in 2023 to 2.4% in 2024.

    Still, the overall user base remains small. Just 0.5% of Americans use nicotine pouches, compared with 9% who smoke cigarettes and 3% who vape or use e-cigarettes, according to U.S. Census Bureau data.

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  • Big tobacco companies reach tentative multibillion-dollar settlement with Canada

    Big tobacco companies reach tentative multibillion-dollar settlement with Canada

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    TORONTO (AP) — Three large tobacco companies would pay nearly $24 billion to settle a long-running legal battle in Canada, according to a proposed deal.

    Philip Morris International said Friday that a court-appointed mediator had filed the proposed settlement with its Canadian affiliate, Rothmans, Benson & Hedges, over tobacco product-related claims and litigation in Canada. Similar deals were also filed covering JTI-Macdonald Corp. and Imperial Tobacco Canada Ltd.

    “After years of mediation, we welcome this important step towards the resolution of long-pending tobacco product-related litigation in Canada,” Philip Morris International’s CEO Jacek Olczak said in a statement.

    The three tobacco companies had sought creditor protection in Ontario in early 2019 after they lost an appeal in a landmark court battle in Quebec.

    The Canadian Press reported that under the $32.5 billion Canadian dollar ($23.53 billion) deal, Canadian provinces and territories would get a combined CN$24.8 billion; members of the class action would get CN$4.25 billion; Canadian victims from provinces outside Quebec would receive CN$2.5 billion; and the three tobacco companies would also pour more than CN$1 billion into a foundation to fight tobacco-related diseases — that amount includes CN$131 million taken from the money allocated to the Quebec plaintiffs.

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  • 1 Stock Yielding 8.6% vs. 1 Stock Yielding 5.2%: Which Is Better for Passive Income Investors?

    1 Stock Yielding 8.6% vs. 1 Stock Yielding 5.2%: Which Is Better for Passive Income Investors?

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    Many people are searching for investments that create passive income — assets that will distribute cash to them on a regular basis, hopefully in growing amounts over the years. You can achieve passive income from your stock market investments by buying shares of companies that pay dividends. The problem is, most stocks have fairly meager dividends today, or don’t pay them at all.

    Illustrating that point, the average dividend yield for the stocks in the broad-market S&P 500 index is only 1.35%. If you want more passive income than that, you might be better off buying short-term U.S. Treasuries or parking cash in a high-yield savings account. To build a passive income dividend portfolio, investors need to pick individual stocks with durable and high dividend yields.

    Two stocks with high dividend yields today are Altria Group (NYSE: MO) and Philip Morris International (NYSE: PM). Both are tobacco giants and, funnily enough, used to be parts of the same company back in the day. One stock yields 8.6%, while the other yields 5.2%. But which is a better passive income play now?

    Altria Group: High yield from legacy tobacco

    Altria Group owns Philip Morris USA, which is a leading tobacco/nicotine company in the United States. Tobacco stocks have been some of the market’s strongest performers over the last few decades due to how cash-generating the cigarette business is. The company has had to deal with declining sales volumes in the cigarette business, but it has counteracted the impact of that by steadily raising cigarette prices. Last quarter, Altria management estimated that industrywide, total estimated domestic cigarette industry volume fell by 9% year over year. But Altria’s revenues net of excise taxes only fell by 2.2% year over year.

    The combination of price hikes and volume declines has led to consistent earnings growth. Free cash flow per share has grown by 122% over the last 10 years. One driver of this has been Altria’s stock-buyback program, which helps juice free cash flow per share. The number of shares outstanding has fallen by 13.4% over the last 10 years, and the company has accelerated its repurchases in recent quarters.

    Free cash flow is what companies prefer to tap for dividend payments, and it has fueled the growth of Altria shareholders’ payouts. Currently, its annual dividend payment is $3.88 per share, well below its trailing free cash flow of $5.09 per share. That dividend yields an appetizing 8.6% at the current share price.

    MO Dividend Per Share (TTM) Chart

    MO Dividend Per Share (TTM) Chart

    Philip Morris International: Growth in new nicotine products

    The international part of the Philip Morris operation is owned — unsurprisingly — by Philip Morris International. The company sells cigarettes and tobacco products essentially everywhere but the United States. However, unlike Altria Group, Philip Morris is not experiencing huge volume declines in its cigarette business. Last quarter, its combustibles sales volume only shrank by 0.4% year over year.

    On top of this, Philip Morris International is the leader in new-technology nicotine products. It owns the top heat-not-burn tobacco brand, Iqos, which is growing like wildfire in Europe and Japan. In the United States, it has the Zyn nicotine pouch brand, which has grown volumes from essentially zero six years ago to 443 million cans over the last 12 months. These developments drove overall shipment volumes up 3.6% last quarter, and revenue rose by 11% due to price hikes.

    The company currently pays a dividend of $5.17 per share, which is only slightly below its free cash flow of $5.76 per share. That narrow gap is something that income investors should consider. At current share prices, the stock’s dividend yields about 5.2%.

    PM Dividend Per Share (TTM) ChartPM Dividend Per Share (TTM) Chart

    PM Dividend Per Share (TTM) Chart

    Which is the better dividend stock?

    Altria and Philip Morris International both have positives and negatives for income investors. Altria has a higher yield and more room to raise its dividend, based on its free cash flow numbers. However, it is facing faster volume declines in the United States market.

    Philip Morris International pays a smaller dividend and only has a little room to grow it based on its free cash flow. Despite this, I think Philip Morris International is the better stock to buy for dividend investors over the long term. Sales of new-technology nicotine products are growing quickly, and should start generating healthy amounts of cash flow for Philip Morris over the next few years. Cigarette consumption outside the United States is much more durable as well, which should allow it to achieve better revenue and earnings growth. This combination should lead to faster dividend growth for Philip Morris International over the long haul.

    Altria Group should do fine for investors for the next five to 10 years. But the better passive income bet that you can “set and forget” in your portfolio is Philip Morris International.

    Should you invest $1,000 in Altria Group right now?

    Before you buy stock in Altria Group, consider this:

    The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Altria Group wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

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    Brett Schafer has no position in any of the stocks mentioned. The Motley Fool recommends Philip Morris International. The Motley Fool has a disclosure policy.

    1 Stock Yielding 8.6% vs. 1 Stock Yielding 5.2%: Which Is Better for Passive Income Investors? was originally published by The Motley Fool

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  • Potential Bids for U.S. Steel Keep Getting Weirder

    Potential Bids for U.S. Steel Keep Getting Weirder

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  • Alibaba, Dice, Arcellx, Avis, PayPal, and More Stock Market Movers

    Alibaba, Dice, Arcellx, Avis, PayPal, and More Stock Market Movers

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