Electronic Cigarette Wholesale - Decision Against FDA

Mobile Media Unlimited Holdings Inc.

On the eve of one of the most important and influential decisions to hit the United States of America within the last decade, electronic cigarettes now have a chance to leap forward and compete with the tobacco empire. This, in itself represents a tremendous opportunity for investors looking to make big bucks from a once struggling e-cigarette industry. Opportunity amongst uncertainty speaks front, right and center for this little company out of the United Kingdom. Up until January, the uncertainty aspect undoubtedly outweighed the two factors, however, times have changed drastically since then. The headlines couldn’t be more foretelling of the unmistakable opportunities lying within Mobile Media Unlimited Holdings (OTC:MMUH). For readers who are new to the company, we recommend you read our introductory company article entitled, “Landmark Victory for E-Cigarette Industry Against the FDA Leaves Plenty of Opportunities”, written and introduced by our Publisher, Michael Vlaicu. The first article was from a much more technical standpoint, gearing towards those chart scanning, number crunching fanatics out there. Consequently, this one will take a look at the fundamental business model, as well as the economic conditions surrounding the company and its future prospectus.

Earlier this month, in a sharply worded decision, U.S. District Judge Richard Leon scolded the Food and Drug Administration for trying to assert jurisdiction over the cigarettes, which are battery-powered or rechargeable devices that vaporize a liquid nicotine solution. It is a $100 million industry, with at least 3 million users in the U.S.

“This case appears to be yet another example of FDA’s aggressive efforts to regulate recreational tobacco products as drugs or devices,” he said in granting an injunction barring the FDA from regulating the cigarettes as a drug-device combination. E-cigarettes were first made in China and are sold mostly on the Internet. The battery-powered devices work by a emitting a “puff” or fine mist of nicotine in the lungs. A law passed last year gave the FDA power over regular cigarettes and other tobacco products. But while e-cigarettes contain nicotine, they do not contain tobacco and are not subject to the new oversight.

Although the facts on cigarettes and the harmful side effects of smoking tobacco have been out for quite some time, conversely, little is known about e-cigarettes. Cigarettes and their smoke contain more than 4,000 chemicals; among them are more than 60 known carcinogens, according to the American Cancer Society.

FDA Scrutny Against E-Cigarettes

The U.S. Food and Drug Administration (FDA) looks at the electronic cigarette as an unapproved new drug due to the lack of scientific evidence of the safety and effectiveness of this smoking substitute. As such, the FDA has been detaining and blocking imports of electronic cigarettes since at least last summer, though they are not pulling e-cigarettes from U.S. store shelves presently.

One of the ways that the government managed to pass its recent tobacco reform bill was by enlisting big tobacco’s support. So the FDA and big tobacco have a symbiotic relationship. The government gets billions of dollars from excise tax revenue on and lawsuits related to cigarettes. Big tobacco gets regulation that makes it harder for smaller companies to compete. So the FDA needs to keep up its end of the bargain here and not allow a threat like e-cigarettes to take hold in the U.S. — even if they did turn out to be good for the American people.

In a statement issued in September of 2008, the World Health Organization warned consumers that there is no solid evidence to support contentions that electronic cigarettes are a safe smoking alternative — or an effective way to help people quit smoking. This statement becomes all the more interesting when drawing up a comparison between the two:

A Few of the Ingredients that Goes into the Making of Cigarettes:

* Acetone – ingredient in nail polish remover tobacco ingredients
* Methanol – used as rocket fuel
* Naphthylamine – a carcinogenic
* Pyrene – a carcinogenic
* Naphthalene – moth repellent
* Cadmium – used in batteries, a carcinogenic
* Carbon monoxide – poisonous gas
* Vinyl Chloride – used in plastic materials
* Cyanhydric acid – was used in gas chambers
* Ammonia – detergent
* Arsenic – lethal poison
* Dibenzacridine – a carcinogenic
* Polonium 210 – a radioactive element
* DDT – insecticide
* Formaldehyde – used as an embalming fluid

Ask a person on the street how or what poisonous chemicals an e-cigarette produces, and they will give you the same puzzled facial expression Mr.Bean has been giving his fans worldwide for the last ten years. Now that we are well acquainted with the toxicities present in cigarettes, lets analyze the containments of e-cigarettes.

Mind Games played by the FDA

So what really is it really about the e-cigarette that makes it so bad, so repelling for the human body as appose to the number one all-time over-the-counter human killer? Well, let’s take a look: E-Cigarette is an electronic device consisting of a battery and a heating element. When activated, the heating element boils a small amount of liquid in the device, creating a vapor, which is then inhaled by the user. The experience of inhaling the vapor closely mimics the experience of inhaling smoke from a regular cigarette.

The liquid and vapor contain three main ingredients: nicotine, propylene glycol, and flavoring.

These three ingredients are also found in regular cigarettes and are known not to be carcinogenic, and are approved by the FDA.

Puzzled? So were we, until we dug further.

Many of you by now must be wondering, well, we’ve seen the hype, we’ve seen the ramblings on message boards and forums, now let’s see some tests conducted on these e-cigs by some sort of reputable sources. Lucky for you we have some really dedicated staff here at TheMarketFinancial.com which spent sleepless days digging up raw data for you to feast your eyes on.

FDA Report Validates Previous Scientific Data. Findings Verify Claims By Manufacturers That Electronic Cigarettes Are Safer Than the Leading Tobacco Brand Cigarette.

On July 22, 2009 the FDA released the results of its own independent study of the electronic cigarette. The findings verify previous test results (1) which validate the electronic cigarette is up to 1,400 times safer than the leading brand of cigarettes. This is GREAT news for Electronic Cigarette users.

Previous studies on the e-cig (verified by the FDA Report) only show that electronic cigarettes contain very low levels (8.2 ng/g) of Tobacco-Specific Nitrosamines versus 11,190 ng/g for the leading tobacco cigarette.

Product NNN NNK NAT NAB Total

Electronic cigarettes (2) 3.87 1.46 2.16 0.693 8.2
Camel (1) 3100 1400 2800 150 7450
Skoal (1) 4500 470 4100 220 9290
Marlboro (1) 4300 1800 4900 190 11,190

(1) Laugesen M. Safety Report on the Ruyan e-cigarette Cartridge and Inhaled Aerosol. Christchurch, New Zealand: Health New Zealand Ltd, 2008. (Link)

Perhaps even more important than the findings of the FDA is what the FDA did NOT find. The test did not reveal any of the 60 other known carcinogens (shown below)2 that are found in traditional tobacco products nor stated any other new dangers or findings that could conclude that the electronic cigarette is dangerous.

2 Known carcinogens found in tobacco cigarettes.
Acetaldehyde Acetamide Acrylamide Acrylonitrile 2-Amino-3,4-dimethyl-3H-imidazo(4,5-f)quinoline (MeIQ) 3-Amino-1,4-dimethyl-5H-pyrido (4,3-b)indole (Trp-P-1) 2-Amino-l-methyl-6-phenyl-1H-imidazo (4,5-b)pyridine (PhlP) 2-Amino-6-methyldipyrido(1,2-a:3′,2′-d)imidazole (Glu-P-1) 3-Amino-l-methyl-5H-pyrido {4,3-b)indole (Trp-P-2 2-Amino-3-methyl-9H-pyrido(2,3-b)indole (MeAaC) 2-Amino-9H-pyrido(2,3-b)indole (AaC) 4-Aminobiphenyl 2-Aminodipyrido(1,2-a:3′,2′-d)imidazole (Glu-P-2) 0-Anisidine Arsenic Benz(a)anthracene Benzene Benzo(a)pyrene Benzo(b)fluoranthene Benzo(j)fluoranthene Benzo(k)fluoranthene Benzo(b)furan Beryllium 1,3-Butadiene Cadmium Catechol (1,2-benzenediol) p-Chloroaniline Chloroform Cobalt p,p’-DDT Dibenz(a,h)acridine Dibenz(a,j)acridine Dibenz(a,h)anthracene 7H-Dibenzo(c,g)carbazole Dibenzo(a,e)pyrene Dibenzo(a,i)pyrene Dibenzo(a,h)pyrene Dibenzo(a,i)pyrene Dibenzo(a,l)pyrene 3,4-Dihydroxycinnamic acid (caffeic acid) Ethylbenzene Ethylene oxide Formaldehyde Furan Glycidol Heptachlor Hydrazine Indeno(1,2,3-cd)pyrene IQ 92-Amino-3-methyl-3H-imidazo(4,5-f)quinoline) Isoprene Lead 5-Methyl-chrysene 2-Naphthylamine Nitrobenzene Nitrogen mustard Nitromethane 2-Nitropropane N-Nitrosodi-n-butylamine (NDBA) N-Nitrosodi-n-propylamine (NDPA) N-Nitrosodiethanolamine (NDELA) N-Nitrosodiethylamine (DEN) N-Nitrosodimethylamine (DMN) N-Nitrosoethylmethylamine (NEMA, MEN) 4-(N-Nitrosomethylamino)-1-(3-pyridinyl)-1-butanone (NNK) N’-Nitrosonornicotine (NNN) N-Nitrosopiperidine (NPIP, NPP) N-Nitrosopyrrolidine (NPYR, NPY) Polonium-210 (Radon 222) Propylene oxide Safrole Styrene Tetrachloroethylene o-Toluidine (2-methylaniline) Trichloroethylene Urethane (carbamic acid, ethyl ester) Vinyl acetate Vinyl chloride 4-Vinylcyclohexene 2,6-Xylidine (2,6-dimethylaniline)

Dr. Michael Siegel MD, Boston University states “The FDA and anti-smoking groups are comparing electronic cigarettes to a solution of spring-fresh Maine mountain stream water. What they need to compare electronic cigarettes to is something known as a Marlboro cigarette.”

Dr. Siegel continues, “In addition, recent research conducted by Dr. Murray Laugesen and Health New Zealand, LTD. reveals that the toxic emissions score for electronic cigarettes is much lower than that of conventional cigarettes. In fact, the toxic emissions score – which is a score based on the levels of 59 priority toxicants was zero for electronic cigarettes. In contrast, it was 126 for Marlboro and it was no lower than 100 for any brand of conventional cigarette tested.”

Testimonials Regarding E-Cigarettes

Though there are many different sites offering a wide variety of testimonials regarding this product, we would like to highlight one story which captured the heart of our entire staff here at TMF:

The article introdues a woman named Sharon Bosworth, a chronic smoker who has tried just about every known anti-smoking aid on the market. “Sharon Bosworth is running out of ways to break the grip of the cigarette. Suffering from emphysema, the Overland Park woman, 51, has tried gum, the patch and even classes on how to quit. Now she is turning to a cigarette for the 21st century, one that relies on electricity, batteries and liquid nicotine instead of matches, fire and tobacco.”

It is both compelling and informative, offering a true sense of the potential exhibited by this marvelous innovation.

To read the full story, “The E-cigarette Lights Up a Debate”, follow this link.

One Company Already Experienced Explosive Sales After the Ruling

As with any investment decision, the competitive environment is among the top of the quintessential factors to be considered. Thus, it is not surprising we take a look at a recent press release made by E Cigarettes National, in which they claim that customers have been in a frenzy over the product.

The e-cigarette has been flying off of the shelves over the last week, likely due to a recent decision by a federal judge that blocked the FDA from stopping shipments of the new alternative to tobacco that is making waves across the US and around the world.

“I did not want to make the investment in them and then have them banned, and no way to get the refills for them,” states Judy Durhan of Tennessee. “So I waited for the ruling to make sure I was not wasting my hard earned money to turn around and lose it. Thank God this federal judge made the decision in e-cigarettes’ favor.”

According to Tiffany Ellis of E Cigarettes National, this is a common story they get from customers that have been on the fence over the electronic cigarettes legal issues. “We believe that now we can sell our product in peace while the remainder of the process is completed in a court of law, and we also believe that the e-cigarette, like our Firelight e cigarette kits, will continue to be sold to the public as a tobacco product or tobacco alternative. Our brand has seen a considerable jump in sales and we expect this trend to continue as more and more smokers make the switch and more people learn about them.”

Another reason E Cigarettes National may be seeing an increase in sales is the popular Firelight series of e-cigarettes that add many extras at a much lower price point than most of the competitors online and at retail locations across the US. With this kit being just under 50 dollars, this may be a determining factor in the sudden increase in the sites popularity.

FDA Finally Coming to Terms?

In a recent headline which made news around the world, the FDA seems to at last come to grips with reality and do that which they are supposed to do, care for its own people.

U.S. regulators are working to lift the smokescreen clouding the ingredients used in cigarettes and other tobacco products.

In June, tobacco companies must tell the Food and Drug Administration their formulas for the first time, just as drugmakers have for decades. Manufacturers also will have to turn over any studies they’ve done on the effects of the ingredients.

It’s an early step for an agency just starting to flex muscles granted by a law that took effect last June that gives it broad power to regulate tobacco far beyond the warnings now on packs, short of banning it outright.

To read the full story entitled, “Tobacco Companies Must Reveal Ingredients, Formulas to FDA”, visit this link.

The Future of Mobile Medial Holdings

It is undoubetly certain this company has a bright future ahead of itself. As Robert Paterson, President of TzuFuma Inc. stated in a recent phone interview, “We anticipate gross revenues from domestic sales to be in the region of 12-14% of our total gross revenue for fiscal 2010. We fully anticipate 2010 to be a bumper year.” TzuFuma’s unaudited financial statements for the period of 2nd Qtr-4th Qtr 2009 is expected to be released in early 2010, leaving much excitement for current shareholders as they anticipate sales figures to beat last year’s in light of the recent developments.

With $5,000,000* (Five Million USD) (*unaudited) in gross sales over the last year, as per TzuFuma’s 11/01/09 Summary of Business Operations, the company has a solid amount of liquid assets to sustain strategic business opportunities for the months ahead. Advertising campaigns, distribution channels and labour costs should all be covered under their current revenue model, paving the way for a prosperous new beginning in 2010.

Dislcosure: Long MMUH
TheMarketFinancial is not paid, compensated or in any way incentivized to report news and developments about publicly traded companies, unless otherwise stated.

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