E-cigarette sales explode as Smoke NV dominates Canadian market

And it's just getting started.


(Photo: Farzin Ghayor)

When Shanu Mohamedali boasts that his electronic cigarette business is exploding, he’s not blowing smoke.

It’s 5:15 a.m. local time, and Mohamedali is on the phone from Hong Kong, where he’s hoping to find new retailers for his Edmonton-based company, Smoke NV (pronounced “smoke envy”). Launched in 2009, Smoke NV dominates the nascent e-cigarette market in Canada and is establishing toeholds in Australia and South America. “We went from thousands of dollars, to hundreds of thousands of dollars, to last year, when we broke $6 million in sales,” says Mohamedali. “This year, we’re aiming to attain $10 million in sales.”

E-cigarettes are intended to mimic normal cigarettes—but without all that, you know, cancer. The white tubes contain liquid cartridges that a heating element transforms into a vapour that the user inhales. (Devotees call the activity vaping.) In other parts of the world (and on the Internet grey market), e-cigarettes contain nicotine—an ingredient Smoke NV opposes, says Mohamedali. “We have never brought in, nor intended to bring in, e-cigarettes with nicotine.”

In fact, Mohamedali points out that several of privately held Smoke NV’s shareholders are physicians. They argue that nicotine-free e-cigarettes can help people stop smoking. “For us, the mandate is harm reduction. We tell people to use this product in conjunction with smoking cessation devices like the patch, like the gum.”

In the company’s early days, Mohamedali pitched that angle to pharmacists and other retailers, with little success. “They all liked it, but no one wanted to be the first one to pull the trigger and go with it,” he recalls. When London Drugs picked up the product, however, the floodgates opened.

Despite its booming sales, Smoke NV exists in a bit of a regulatory vacuum. Health Canada outlaws e-cigarettes containing nicotine but (after much campaigning on Mohamedali’s part) tolerates those with no nicotine. Even so, some experts urge people to think twice before using any e-cigarette. “Any time you inhale anything, there’s potential for damage, both short term and long term, to our lungs and our bodies,” says Barb Borkent, program specialist for the Lung Association in Alberta and the Northwest Territories. Borkent says she requested an ingredients list for Smoke NV’s liquid cartridges but got no response. (She also stresses that, whatever the vapours may contain, they are almost certainly much less harmful than cigarette smoke.)

Mohamedali says he shares people’s concerns. “All the questions they have are the same questions that we have,” he asserts. To that end, Smoke NV has lined up a University of Alberta researcher and is working to arrange an arm’s-length clinical trial. “We’re very confident that the results will be good. But, regardless of the outcome, whether it’s good or it’s bad, we’re standing on the sideline.” In the meantime, sales are smoking.