22nd Century has had more than 20 conversations
with the FDA on matters relating to the Company’s PMT and MRTP
applications
22nd Century will substantially increase
Company’s investment in hemp/cannabis
22nd Century Group, Inc. (NYSE American: XXII), a plant
biotechnology company that is focused on tobacco harm reduction,
Very Low Nicotine Content tobacco, and hemp/cannabis research,
announced today that the Company has issued its annual letter to
shareholders as part of 22nd Century Group’s 2018 Annual Report.
The 2018 letter to shareholders is reprinted below.
In addition, all shareholders of record as of the close of
business on March 15, 2019 are invited to attend 22nd Century’s
annual shareholder meeting on Friday, May 3, 2019, at 10:30AM at
the The Larkin Center of Commerce, 701 Seneca Street, Buffalo, New
York 14210. 22nd Century’s President and Chief Executive Officer,
Henry Sicignano III, will provide a business update.
****************************
Dear Fellow Shareholders:
For 22nd Century Group, 2018 was a year of investment. The
Company invested considerable resources, time, and capital to
accomplish the most important project in our history: submission of
our Premarket Tobacco Product (PMT) application and our Modified
Risk Tobacco Product (MRTP) application for the Company’s
proprietary Very Low Nicotine Content (VLNC) cigarettes to the U.S.
Food and Drug Administration (FDA). At a cost exceeding $10
million, our PMT and MRTP applications actually represent many
years of work.
The culmination of our efforts was the December 2018 submission
of more than 200,000 pages of data – including research from more
than 150 independent studies – to the FDA’s Center for Tobacco
Products. With these PMT and MRTP applications, 22nd Century is
seeking the FDA’s authorization to commercialize the Company’s
proprietary VLNC cigarettes under the proposed brand name “VLN™”
and to advertise to consumers that VLN™ cigarettes contain 95% less
nicotine as compared to the 100 leading cigarette brands in the
United States.
According to FDA Commissioner, Dr. Scott Gottlieb,
“Cigarettes are the only legal consumer product that, when used as
intended, will kill half of all long-term users.”
22nd Century’s proprietary VLNC cigarettes have been designed to
put an end to this madness.
Following our PMT and MRTP submissions, 22nd Century regulatory
specialists and scientists have been in virtually constant
communication with FDA regulators charged with reviewing the
Company’s PMT and MRTP applications. Already, we have had more than
20 conversations with the FDA on matters relating to our PMT and
MRTP applications. The review process by the FDA for our
applications is well underway and we look forward to the approval
and launch of what may very well prove to be the world’s first
Modified Risk Tobacco Product.
Concurrently, the FDA is pursuing its plan to limit nicotine in
ALL cigarettes sold in the United States to minimally or
non-addictive levels. Early in 2018, the FDA issued an Advanced
Notice of Proposed Rulemaking (ANPRM) as the Agency explained the
substantial science behind its plan to dramatically lower the
nicotine in all U.S. cigarettes. Going forward, the FDA will soon
(expected in 2019) issue a Notice of Proposed Rulemaking (NPRM). In
the NPRM, the FDA will spell out the proposed product
specifications and the details for how the Agency will implement
its new nicotine reduction rule. Following the issuance of the NPRM
and a public comment period, the FDA should thereafter move forward
with a final rule and a time schedule for the national
implementation. We believe the FDA is moving at a steady,
deliberate pace in this initiative in order to assist the more than
30 million American smokers who are addicted to conventional
cigarettes and the 2,000 youth – under the age of 18 – across the
United States who smoke their first addictive cigarettes each
day.
While our PMT and MRTP efforts are independent of the FDA’s
planned mandate to limit the nicotine in all cigarettes sold in the
United States to minimally or non-addictive levels, we view the two
initiatives as complimentary and reinforcing. 22nd Century’s VLNC
tobacco is the foundation of our MRTP candidate and, at the same
time, our VLNC tobacco makes possible the FDA’s planned nicotine
reduction rule. It is precisely because of this connection that we
continue to believe that the FDA and public health will benefit
from the approval of 22nd Century’s MRTP application. In this way,
the FDA will have a commercial VLNC cigarette on the market to
prove the feasibility of the FDA’s nicotine reduction plan and to
generate real-world consumer data in support of the FDA’s proposed
new rule.
All of that said, and as important as our tobacco initiatives
are for the Company and for our shareholders, our strategic
initiatives in hemp and cannabis – together with significant recent
legislative changes – have combined to give our biotechnology
efforts a massive boost in the emerging hemp/cannabis industry. By
the end of 2018, more than half of U.S. states had approved the
sale and use of medical cannabis, with another 10 states allowing
adult, recreational consumption. Even more importantly, in an
effort led by U.S. Senate Majority Leader Mitch McConnell, the U.S.
federal government enacted the 2018 Farm Bill in December,
including an important provision to legalize “hemp,” which is
defined as the cannabis plant containing not more than 0.3% THC.
The enactment of this new federal law has accelerated hemp/cannabis
biotechnology developments and spurred a slew of
multi-million-dollar investments in hemp/cannabis production and
extraction. 22nd Century is well positioned to take advantage of
the opportunities represented by these changes in the federal
law.
22nd Century’s mission is to develop proprietary
hemp/cannabis plant lines for important new medicines and robust
agricultural crops in order to improve the health and lives of
people around the world.
Our Company’s genesis in hemp/cannabis research is already well
established. In 2014, a wholly-owned subsidiary of 22nd Century
entered into a worldwide license agreement with Anandia
Laboratories in Canada through which our Company was granted an
exclusive sublicense in the United States and a co-exclusive
sublicense in the remainder of the world, excluding Canada, to
patents and patent applications relating to the hemp/cannabis plant
that are required for the production of cannabinoids, the major
active ingredients in the hemp/cannabis plant. In 2018, when Aurora
Cannabis purchased Anandia Labs, we were able to monetize our 2014
investment – realizing a return on our investment of more than 800%
(and, of course, this return does not even include the value of the
warrant we received to purchase 973,971 shares of Aurora Cannabis
common stock; 22nd Century continues to hold this warrant). Keep in
mind too, the valuable licenses that we received from Anandia in
2014 that allow 22nd Century to manipulate the production of
cannabinoids in the hemp/cannabis plant. These licenses survive
the Aurora Cannabis acquisition of Anandia. What’s more, our
subsequent investments in research with Anandia have already
generated important new cannabis strains – including one with
zero-THC.
Besides our Anandia collaboration, 22nd Century is entering the
third year of a research agreement with the University of Virginia
to optimize our Company’s proprietary hemp plants for growth in the
historical U.S. “tobacco belt states.” In addition, we already
possess a valuable New York State hemp research license for 22nd
Century’s own laboratory in New York. The foundation of any
biotechnology effort is the acquisition of genetic material. To
this end, we have already developed or acquired exclusive rights to
a very significant number of unique and proprietary varieties of
hemp and cannabis plants, each with valuable agronomic traits
and/or exceptional cannabinoid profiles. Further, we are
continually adding to our genetic library. Using genome sequences
from the hemp/cannabis varieties to which we have developed and/ or
acquired exclusive rights, we are in the process of identifying
genes responsible for regulating cannabinoid biosynthesis, drought
tolerance, disease resistance, increased flower production,
increased cannabinoid production, and overall plant growth and
yields.
Going forward, and as our PMT and MRTP applications progress
through the FDA review process, 22nd Century will substantially
increase its investment in the development of hemp/cannabis
intellectual property. While our Company’s molecular biotechnology
laboratory is an important component in achieving our mission of
creating new varieties of hemp/cannabis, our strategy also includes
expanding our network of accomplished hemp and cannabis
researchers, partner companies, and universities. To this end, 22nd
Century is forming a vertically-integrated hemp and cannabis nexus
that combines research, production, and extraction.
As a part of our strategic alliance plans, we are working on
projects to:
1. Create a sophisticated database from the molecular analysis
of approximately 100 hemp/cannabis plant lines for use in
accelerating the Company’s development and licensing of uniquely
characterized lines;
2. Enhance genetic variation to empower 22nd Century’s
production of new GMO and non-GMO hemp/cannabis plant lines;
3. Create a high-resolution map of the cannabis genome to aid
identification of genes for distinctive traits;
4. Compare genomic sequences of multiple cannabis species and
identify shared genetic markers, allowing 22nd Century to produce
improved commercial hemp/cannabis plant lines much more rapidly
than by conventional breeding approaches; and
5. Initiate rapid-cycle generation of hemp/cannabis plant lines
with distinctive cannabinoid and terpene profiles.
At 22nd Century’s own molecular biology lab, our scientists are
making progress in our effort to reproduce cannabinoid
biosynthesis… independent of the hemp/cannabis plant. In this way,
we plan to develop plants that yield single, high-value
cannabinoids instead of the cocktail of cannabinoids produced by
conventional hemp/cannabis plants. Plants that produce high levels
of single, rare cannabinoids would be a boon for our own extraction
activities and for third-party extractors.
Although we do not necessarily intend to enter the complex
regulatory arena of marketing hemp/cannabis-based consumer goods,
we do plan to become a source of highly-coveted hemp/cannabis
genetics, plant varieties, and high-value extracted cannabinoids.
22nd Century is at the leading edge of hemp/cannabis genomics,
pushing the boundaries of what is possible with the hemp/cannabis
plant.
In a similar way, 22nd Century is adding to the prodigious
tobacco technology already possessed by the Company. Much to the
chagrin of “Big Tobacco” companies, 22nd Century’s proprietary VLN™
tobacco – with at least 95% less nicotine than conventional tobacco
crops – has already been grown at commercial scale. Further, in an
effort to address the needs of international markets, in 2019 the
Company will introduce to the world new non-GMO varieties of
drastically reduced nicotine tobacco. With these proprietary
tobaccos and with the Company’s unrivaled technology, 22nd Century
promises to help smokers substantially reduce their exposure to
nicotine.
In short, we are the holders of extraordinary technology. Once
regulatory approvals are secured, we will have the opportunity to
disrupt the entire $80 billion U.S. tobacco industry with exclusive
products that could play a critical role in saving millions of
lives. In hemp/cannabis, we have plans to produce proprietary
plants with extraordinary levels of some of the most sought-after
cannabinoids.
On behalf of the Board of Directors and the 22nd Century Group
management team, we thank you for being part of our family of
shareholders. We look forward to meeting many of you at our annual
shareholder meeting in May and to sharing exciting Company
developments with everyone in the weeks and months to come.
Best regards,
Henry Sicignano IIIPresident & Chief Executive Officer
About 22nd Century Group, Inc.
22nd Century is a plant biotechnology company focused on
technology which allows it to increase or decrease the level of
nicotine in tobacco plants and the level of cannabinoids in
hemp/cannabis plants through genetic engineering and plant
breeding. The Company’s primary mission in tobacco is to reduce the
harm caused by smoking. The Company’s primary mission in
hemp/cannabis is to develop proprietary hemp/cannabis strains for
important new medicines and agricultural crops. Visit
www.xxiicentury.com and www.botanicalgenetics.com for more
information.
Cautionary Note Regarding Forward-Looking Statements: This press
release contains forward-looking information, including all
statements that are not statements of historical fact regarding the
intent, belief or current expectations of 22nd Century Group, Inc.,
its directors or its officers with respect to the contents of this
press release, including but not limited to our future revenue
expectations. The words “may,” “would,” “will,” “expect,”
“estimate,” “anticipate,” “believe,” “intend” and similar
expressions and variations thereof are intended to identify
forward-looking statements. We cannot guarantee future results,
levels of activity or performance. You should not place undue
reliance on these forward-looking statements, which speak only as
of the date that they were made. These cautionary statements should
be considered with any written or oral forward-looking statements
that we may issue in the future. Except as required by applicable
law, including the securities laws of the United States, we do not
intend to update any of the forward-looking statements to conform
these statements to reflect actual results, later events or
circumstances, or to reflect the occurrence of unanticipated
events. You should carefully review and consider the various
disclosures made by us in our annual report on Form 10-K for the
fiscal year ended December 31, 2018, filed on March 6, 2019,
including the section entitled “Risk Factors,” and our other
reports filed with the U.S. Securities and Exchange Commission
which attempt to advise interested parties of the risks and factors
that may affect our business, financial condition, results of
operation and cash flows. If one or more of these risks or
uncertainties materialize, or if the underlying assumptions prove
incorrect, our actual results may vary materially from those
expected or projected.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20190328005213/en/
22nd Century Group, Inc.James Vail, Director of
Communications(716) 270-1523jvail@xxiicentury.com
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