(Reuters) – Tobacco giant Philip Morris International (NYSE:) said on Monday it will suspend online sales on Swedish Match North America's ZYN.com website nationwide as nicotine pouch maker Zyn responds to a recall from the District of Columbia (D.C.). ).
Philip Morris bought Swedish Match in a $16 billion deal in 2022 as the company looked to reduce its reliance on cigarettes amid stricter regulations and a consumer shift toward tobacco alternatives and traditional cigarettes.
Swedish Match North America received a subpoena from the D.C. Attorney General requesting information about its compliance with D.C.'s 2022 ban on the sale of all flavored tobacco, the company said.
In October 2022, DC banned the sale of all flavored tobacco, including flavored synthetic nicotine products.
Philip Morris said it intends to comply with DC's request and that in the event of an unfavorable outcome related to this matter, it could reasonably be held liable.
The company said that its initial investigations indicate that there are sales of flavored nicotine pouch products in the capital, most of which are linked to certain online sales platforms and some independent retailers.
“Swedish Match is conducting a full review of its sales and supply chain arrangements in D.C. and other U.S. regions where the flavor ban may apply, and is temporarily suspending all sales on ZYN.com until this evaluation is completed,” a Philip Morris spokesperson told Reuters.
Philip Morris has benefited from strong demand for its “Zen” nicotine pouches in the United States, which the company says do not contain tobacco.
In its first-quarter results, announced in April, Zyn nicotine pouch shipments increased nearly 80% compared to a year ago. Sales on ZYN.com represent “a very small percentage of ZYN's nationwide sales volume,” the company added Monday.
