22nd Century Group Inc (XXII)

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one more step forward
22nd Century Group (XXII) Announces Fully Integrated, Single-Source Strategic License, Manufacturing and Distribution Agreement with Cookies
04/05/2023
Launches Turn-Key Contract Development and Manufacturing Plus Distribution (CDMO+D) Solution for Industry Leading Hemp/Cannabis Brands
Highly Accretive Transformative Deal Utilizes Entire 22nd Century Value Chain, from Receptor Science to Category Management in Retail Distribution with Most Recognized Cannabis Brand in the World

BUFFALO, N.Y., April 05, 2023 (GLOBE NEWSWIRE) -- 22nd Century Group, Inc. (Nasdaq: XXII), a leading biotechnology company dedicated to improving health with reduced nicotine tobacco, hemp/cannabis and hops advanced plant technologies, today announced a new three-year exclusive license and distribution agreement (the “Agreement”) with Cookies, the most globally recognized hemp/cannabis company in the world. The brand was founded in 2010 by chief executive officer, rapper and entrepreneur Berner and Bay Area breeder and cultivator Jai.

“This transformational strategic license, manufacturing and distribution agreement with Cookies establishes the foundation of an innovative new CDMO plus distribution business model for 22nd Century at a time when mass market channels urgently need to find new, high-margin, high-velocity products to meet the rapidly growing consumer demand for CBD products,” said James A. Mish, Chief Executive Officer of 22nd Century. “Our complete, vertically integrated capabilities represent the first and only industry option providing Cookies’ category leading, CBD brand with a single-source, national solution across its entire family of products.”

“We are incredibly excited to expand our partnership beyond GVB with the 22nd Century Group. They have undoubtedly put together one of the most impressive teams in the space, and we look forward to expanding the national distribution of Cookies non-THC products together,” said Parker Berling, President of Cookies.

The exclusive license with 22nd Century covers all Cookies branded non-Delta-9 THC, hemp derived cannabinoid consumer packaged goods, including sourcing of all ingredients and APIs; white-label manufacturing of vapes and other CBD products; and category management through retail distribution.

GVB Biopharma, a 22nd Century company, has manufactured various Cookies products for the past three years, and under this new Agreement, will manufacture Cookies’ market-leading products, expected to account for more than half of Cookies’ non-Delta-9 cannabinoid sales.

The integrated go-to-market sales and distribution components of the agreement will leverage 22nd Century’s veteran consumer packaged goods (“CPG”) sales team, which plans to distribute Cookies products in up to 18 markets targeted for the rollout of the Company’s innovative VLN® products, during 2023. This combination will allow Cookies to leverage 22nd Century’s purpose built, turn-key sales and distribution platform for alternative consumer products.

Cookies will continue to leverage its robust brand building, marketing and advertising apparatus to support sales of its products, including, but not limited to, direct advertising of their products by Berner across social media, earned media and in-person events. The partnership will also leverage Cookies’ industry leading creative development studios across a number of different placements and categories to promote product launches in key markets.

The CPG sales team will target a market of approximately 60,000 retail stores consisting of independent retail, discount tobacco outlets and vape shops in non-recreational states serviced by its network of top regional distributors and chain discount tobacco outlets. Products will also be available on the Cookies e-commerce website: https://shop.cookies.co/.

“Cookies products are a natural fit to the same points of sale as our FDA MRTP authorized VLN® products. The combination of these two offerings will enhance our sales team’s product portfolio with a larger suite of small-footprint, high-velocity, high-margin CBD products, with Cookies’ internationally recognized products serving as a cornerstone brand as we build out this innovative hemp/cannabis CDMO+D platform,” said John Miller, President of Tobacco Products of 22nd Century.