Tobacco giant Philip Morris International (PM.N), a subsidiary of Swedish Match North America (SMNA), will pay US$1.2 million to settle a probe into violations of a flavored tobacco ban in Washington. The District of Columbia Attorney General’s Office said it found evidence that SMNA facilitated online sales of “tens of thousands” of Zyn flavored nicotine pouches to consumers in DC between October 1, 2022 , when the ban was introduced, and June 30, 2024.
PMI, which acquired a 90% stake in Swedish Match for $16 billion in November 2022, must now monitor its distributor’s compliance with the DC ban on a quarterly basis and stop selling flavored Zyn sachets through Zyn.com and related e-commerce platforms, the AG’s office said. According to a report by the Centers for Disease Control and Prevention, nicotine pouches have become the second most common tobacco product in the United States, with 890,000 students reporting using these products in 2024.
The tobacco giant suspended sales on Zyn.com after it received a subpoena from the District of Columbia Attorney General earlier this year. Swedish Match will continue to focus on its regular stores, PMI said in an emailed statement.Sales of Zyn, which PMI says is tobacco-free, rose sharply, according to PMI’s latest quarterly results, by 41.1%. The company, which is looking to expand beyond traditional cigarettes, has also expanded production to counter a shortage of Zyn supplies in the U.S. amid a nascent black market for nicotine pouches.