In fact, its marketing position is so strong that industry giant
Considering the regulatory and legislative enforcement gripping the sector, enhancing any friendly agreement is timely, especially for deep-pocketed allies that can lengthen competitive advantages over others at the same time. The best news from KAVL's and its investors' perspective is that despite its size, KAVL is holding a strong hand to play in the big leagues of the ENDS sector. In fact, as one of the few ENDS companies still able to take advantage of what is now a wide-open multi-billion-dollar market opportunity, not only is KAVL able to play in the major leagues of the space on their own; they may likely entertain further collaborative and partnership opportunities.
Still Standing As A Solid ENDS Market Participant
There is plenty to support the optimism. Foremost is that KAVL has been able to do something most of its competitors couldn't: win a judicial decision allowing them to sell their products. As reported in August, in a "merits case" brought by Bidi Vapor, the
All other ENDS products on the market today that do not have marketing authorization from the FDA are subject to enforcement at the
Not KAVL. They have instead been beefing up its capabilities, recently extending an agreement with
KMS, incidentally, has been an integral part of the Kaival growth story, providing industry expertise and a team approach that has expedited KAVL's path to successful and compliant marketing. Further, its contributions have been instrumental in shaping KAVL's plan to maximize expected increasing sales volumes following Bidi Vapor's merits case win. The extension is more than a reaffirmation of an accretive business relationship; it's timely to accelerate
Strengthening Its Marketing Relationships
In that respect, KMS adds to the combined marketing efforts of preventing underage use of vaping devices and focuses on the needs of legal-age smokers looking for an alternative to combustible cigarettes. So far, based on legislative feedback, its plan stands as a model for the industry. Moreover, having already been serving as the primary marketing and sales service provider for Kaival Brands since 2020, bringing in over 100 contracted employees dedicated to supporting Kaival Brands' management, that best-in-industry plan is fortified by an established team to accelerate and strengthen sales channels.
Remember, while hundreds of companies and potentially thousands of ENDS brands lost marketing approval in
Noted earlier, they have an excellent start. Its Q3 deal made with
Capitalizing on further interest, KAVL strengthened its agreement with PM in Q2 by granting them a license of certain intellectual property rights relating to Bidi Vapor's premium ENDS device. That includes extending rights and privileges to newly developed devices and permitting PM to manufacture, promote, sell, and distribute such ENDS devices and future developed ones in international markets.
Of course, more aggressive investors may like to read between the lines. In this case, it's easy to do. And while speculative, one of those in-between interpretations is that the marketing and financial muscle behind PM's interest in KAVL is happening for a reason well beyond just having KAVL help them get products to market. It could very well be the first step in a much grander plan to take all of the inherent and intrinsic value from KAVL and take it to an entirely new and much higher level. That's a round-about way of saying KAVL could be an acquisition target.
Speculative, yes. But considering that the Bidi portfolio of products has earned the approval to market both in the States and overseas, purchasing the KAVL value and closing doors to competitive threat may be a wise consideration. If not from PM, then certainly by others, including
It's fair to assume that KAVL has the attention of the ENDS industry. And through many means, they appear well-positioned to capitalize on that interest. Not only because they have an approved brand, either: they also have science to back best-in-class claims.
Pharmacokinetics Data Is Robust
Volumes of data assessing nicotine pharmacokinetics (P.K.) and subjective effects of the BIDI® Stick compared with combustible cigarettes demonstrated significant and desirable differences. Those assessments also showed that Bidi products are in a class of their own, supported by study data indicating that the BIDI® Stick delivered nicotine to users comparably to their usual brand of cigarette and elicited similar subjective effects such as satisfaction and relief. This is one of the primary data points the FDA wants to see before granting marketing authorizations. KAVL and Bidi showed more, strengthening their case for market longevity.
In that respect, because the BIDI® Stick provides measured and consistent nicotine delivery, it meets a second FDA interest in that it can be an alternative to cigarettes among current smokers and may support their transition from cigarette smoking. Of course, consumer taste and interest matter. Bidi didn't fall short of meeting those measures, with data showing that BIDI® Stick provides the satisfaction smokers want, which can aid them in quitting cigarette smoking.
Those advantages matter and may be especially attractive for companies on the market sidelines that want to get back in the game. Without meeting those criteria, marketing approvals may be unrealistic. A case in point, the dominant product JUUL was removed from retail sales placements after failing to meet several FDA mandates. A few reasons were on the marketing side, but they also had their share of product problems
For example, as a comparison, BIDI® Stick nicotine delivery was similar to a cigarette; JUUL nicotine delivery was less than a cigarette. That's an issue that proved costly to JUUL, evidenced by its substantial loss of market presence in
The excellent news is that Bidi products are checking the right boxes.
BIDI® Stick Moves To Phase 3 Scientific Revie
Indeed, doing so has led to the FDA placing the tobacco-flavored Classic BIDI® Stick into the final Phase 3 scientific review. Based on the thousands of documents provided and KAVL's unequivocal commitment to only market these products to people of legal consumption age, it's a fair assumption that the FDA will ultimately grant total marketing approvals. If so, expect to see BIDI® Stick rolled out nationwide and able to leverage a potentially massive marketing position resulting from a significantly thinned-out landscape. KAVL appears ready to pounce on that opportunity.
In July, KAVL announced launching PM's custom-branded self-contained e-vapor product, VEEBA, currently sold in
Assuming KAVL stays on plan, they should have a clear path to marketing approval, which would then present Kaival with many opportunities, including partnerships, licensing, and manufacturing deals. And by being one of, if not the only, near-term proposition to major brands getting back into the market, negotiating agreements could be made from a position of strength.
An International Opportunity In-Play
Know this, too. Most countries aren't following the
Given the favorable dynamics of the
So, while 2021 and 2022 have been transformative, 2023 can be the breakout period for growth. With an energized and focused KAVL team determined to turn ambition into marketing and financial success, paying attention to KAVL, and especially to the reasons why it can be a breakout star, may be a wise and actionable investment consideration. And, knowing that millions of people want and hundreds of companies need the types of products KAVL sells, it could be a timely one, as well.
Disclaimers:
The Private Securities Litigation Reform Act of 1995 provides investors a safe harbor in regard to forward-looking statements. Any statements that express or involve discussions with respect to predictions, expectations, beliefs, plans, projections, objectives, goals, assumptions or future events or performance are not statements of historical fact may be forward looking statements. Forward looking statements are based on expectations, estimates, and projections at the time the statements are made that involve a number of risks and uncertainties which could cause actual results or events to differ materially from those presently anticipated. Forward looking statements in this action may be identified through use of words such as projects, foresee, expects, will, anticipates, estimates, believes, understands, or that by statements indicating certain actions & quote; may, could, or might occur. Understand there is no guarantee past performance will be indicative of future results. Investing in micro-cap and growth securities is highly speculative and carries an extremely high degree of risk. It is possible that an investors investment may be lost or impaired due to the speculative nature of the companies profiled.
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