A group including Silicon Valley entrepreneur Sean Parker is investing $75 million is NJOY, a leading manufacturer of e-cigarettes, reports The Wall Street Journal. Parker co-founded the music-sharing site Napster, was the first president of Facebook and has been a big donor to cancer research.
NJOY accounted for 35.6 percent of the U.S. cigarette market in U.S. convenience stores in the four weeks ended May 11, according to Wells Fargo Securities. NJOY Kings’ brand more closely resembles regular cigarettes than do some competing products. The company has been advertising on TV and attracted celebrity endorsers such as musicians Courtney Love and Bruno Mars.
In March, former U.S. Surgeon General Richard Carmona joined NJOY’s board, saying it is important to explore alternatives to traditional cigarettes because the adult smoking rate has remained stuck at around 20 percent of the population.
E-cigarettes are believed to be less harmful than traditional cigarettes because they don’t rely on combustion However, the Food and Drug Administration warned consumers in 2009 the new technology could pose its own health risks and required further study. The long-term impact of inhaling e-cigarette vapor, which contains substances such as propylene glycol, has yet to be determined. The agency is planning regulation that would treat e-cigarettes as tobacco products.
Industry experts says U.S. retail sales of e-cigarettes could reach $1 billion this year—just 1 percent of the country’s cigarette market but twice that of 2012.