Poda’s eCig Alternative Could Catch Fire in the U.S.
September 28th, 2021
App, Exclusive, News, Top Story
Most U.S. smokers are familiar with e-cigarettes, like Juul, that offer a nicotine experience. But, unfortunately, their catchy flavors have attracted nonsmokers—including young people—and that has caught the attention of the Food and Drug Administration (FDA). Recent crackdowns threaten to kill the nascent vaping industry, leaving a massive vacuum.
Poda Holdings, Inc. (CSE: PODA) (FSE: 99L) (OTC: PODAF) aims to fill the vacuum with its unique heat-not-burn products. Unlike vapes, the company’s cartridges provide a non-tobacco blend that closely resembles cigarette smoking without producing any smoke and significantly lessens the harmful effects.
Let’s look at how the FDA is cracking down on the vaping industry and why Poda’s e-cigarette alternative could soon gain traction.
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FDA Bans Millions of Vaping Products
The FDA refused to grant marketing approval for millions of vape products after requiring tobacco manufacturers to submit a Pre-Market Tobacco Application (PMTA) for every product they began selling after February 15, 2007. While the FDA primarily denied applications due to missing documentation, the move demonstrates its opposition to vape products.
Under the PMTA, the FDA requires manufacturers to show that their products benefit adult smokers sufficient to overcome the public health threat posed by the rise in youth consumption of such products. These rules are stricter than other non-vaping tobacco products that don’t require evidence that children won’t use them.
In addition to the FDA’s effective bans, Congress is considering a tax hike that could double or triple the prices of nicotine-containing e-liquid. As a result, vape manufacturers may have to decide between cutting margins to razor-thin levels or raising consumer prices, which could slow down demand and take a toll on sales.
Heat-Not-Burn Could Gain Traction
Heat-not-burn products have become extremely popular in Japan and other countries around the world. In essence, these products heat tobacco at temperatures sufficient for a great consumer experience without harmful smoke. Philip Morris, a tobacco giant, believes that HNB products could replace traditional cigarettes within 20 years.
Poda’s Beyond Burn Poda Pods provide a specialized blend of pelletized tea leaves and synthetic nicotine that perfectly mimics tobacco. Since the 2009 Family Smoking Prevention and Tobacco Control Act (TCA) only applies to products derived from tobacco, synthetic nicotine isn’t subject to the same regulations as tobacco products.
While Philip Morris’ IQOS is already on the market, the giant’s HNB product was designed mainly based on its existing manufacturing footprint rather than consumer needs. Poda’s Beyond Burn products feature a far superior user experience, including its patented zero-cleaning and zero-maintenance designs, as well as compostable pods.
Beyond the Tobacco Industry
Poda also designed poda pods to extend beyond the tobacco industry. For example, the same technology could apply to caffeine-infused products, nicotine-free blends, real tobacco, cannabis, CBD, or medicinal herbs. With its zero-smoke technology, consumers don’t have to worry about major carcinogenic risk factors.
At the same time, the company plans to offer white labeling opportunities to increase market share and distribution reach. The business is uniquely suited to compete with industry peers with a low-cost production facility while providing a superior product design to edge out the competition. It’s a win-win-win for consumers, partners, and the company.
Investors may find the business model compelling given its razor-razorblade model. The company’s handheld device lasts for years, while the disposable pods are like cigarettes. As a result, the company can effectively sell the devices at cost and generate long-term, high-margin, recurring income from the sale of poda pods over time.
Consumers smoke more than 5.7 trillion legally purchased cigarettes each year. At the same time, consumers are well aware of the health risks posed by ordinary smoking products. E-cigarettes were once hailed as the solution to the problem, but the rise of youth smoking has resulted in the FDA effectively banning millions of these products.
Poda Holdings, Inc. (CSE: PODA) (FSE: 99L) (OTC: PODAF) aims to fill the void left by the vaping products with its unique heat-not-burn technology. With the ability to quickly scale, the company could become a large player in the space or an acquisition target, making it a story that investors should follow over the coming months.
To learn more, visit the company’s website or download their investor presentation.
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