Chill Brands Group PLC (LSE:CHLL, OTCQX:CHBRF) said it ended the sale and marketing of its synthetic nicotine products in the US following tougher US regulations.
According to a statement, additional restrictions for synthetic nicotine products created “substantial costs” for manufacturers and retailers.
As a result, the producer of cannabinoid and CBD products is transferring the remaining US synthetic nicotine stock to other international partners for sale.
Chill Brands launched its tobacco-free nicotine in December last year, but a federal funding bill in March granted the US Food and Drug Administration (FDA) authority over synthetic nicotine, bringing Chill’s product within the scope of tobacco regulations.
This meant the group needed to submit a premarket tobacco application for its product to remain on sale legally, which could cost more than US$400,000.
In addition, should the application be authorised, it would still be heavily restricted in terms of marketing and online sales, with Chill believing more restrictions are likely, making the product no longer commercially viable in the US.
"While synthetic nicotine initially presented itself as a promising growth category, recent developments have made it increasingly difficult and costly for challenger brands to remain on the market,” said chief executive Callum Sommerton.