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Philip Morris International is set to invest $232 million to expand a Kentucky factory that makes nicotine pouches, part of the company's broader strategy toward what it calls a "smoke-free future."
The expansion at the Swedish Match plant in Owensboro is expected to add 450 jobs, boosting the factory's workforce by about 40% to help meet growing demand for smoke-free products, the company said. The factory in western Kentucky produces ZYN nicotine pouches, a brand that's part of a growing segment of nicotine-based alternatives for consumers switching from cigarettes or other tobacco products.
The pouches fit between a person’s lip and gums to slowly release low levels of nicotine absorbed into the bloodstream. The contents dissolve and the pouch is then discarded.
“We are accelerating our mission toward a smoke-free future, working with our U.S. affiliates to move adults away from cigarettes and other traditional tobacco products by providing better alternatives,” Stacey Kennedy, CEO of PMI’s U.S. business, said in a release.
The ZYN oral pouches contains nicotine powder and flavorings like mint, coffee and citrus. The pouches are the fastest-growing segment of the tobacco industry, which has struggled for decades to replace falling cigarette sales.
ZYN is marketed by Philip Morris International to adult tobacco users. Although it doesn’t contain tobacco, U.S. regulators still treat it as a tobacco product. Because pouches generally don’t contain tobacco, so users don't necessarily spit as they do with older products such as chew and snuff.
The Food and Drug Administration says no tobacco product is safe. Cigarettes are widely understood as the most harmful, increasing the likelihood of cancer, heart disease and lung problems. Chewing tobacco is linked to mouth cancer, gum disease and tooth loss.
But researchers and health regulators have begun to acknowledge different levels of harm among different tobacco products.
In 2019, the FDA said an oral tobacco product called snus contains lower cancer-causing chemicals than cigarettes and could benefit smokers who switch. Snus are similar to nicotine pouches like ZYN, except that they contain fermented tobacco.
There’s little research on the long-term effects of nicotine pouches, but many researchers expect they will show similarly low rates of carcinogens and other toxic components.
Still, that doesn’t mean they’re safe. A study last year found ZYN and similar products contain low levels of harmful substances such as ammonia and formaldehyde. The Kentucky factory expansion will be handled through one of PMI’s Swedish Match affiliates.
Construction is underway at the Owensboro facility, with completion expected by the second quarter of 2025, the company said. Building out the factory is expected to create nearly 2,800 jobs.
The expanded facility will ramp up production to an around-the-clock, seven-day-per-week work schedule, the company said. The facility now operates 24-hours a day, five days a week.
Kentucky Gov. Andy Beshear thanked Philip Morris International for “doubling down” on its investment in the state.
The Owensboro location is 106 miles (170 kilometers) southwest of Louisville, Kentucky.
In July, PMI announced it would invest $600 million over two years through its U.S. affiliate to open a nicotine pouch manufacturing plant in Aurora, Colorado. That new plant and the Owensboro expansion will provide the near- and midterm capacity needed to meeting growing U.S. demand for ZYN, it said.
