22nd Century Group CEO to Unveil Updates at Emerging Growth Conference—But Hedge Funds Are Quietly Exiting

The Setup: 22nd Century Group (Nasdaq: XXII) CEO Larry Firestone will present a corporate update on May 21, 2025, at the Emerging Growth Conference. Sounds bullish, right? But here’s the plot twist: major institutional investors just bailed.

The Investor Exit Signal

In Q4 2024, institutional money was voting with their feet—and not in XXII’s favor:

• Vanguard Group dumped 13,096 shares (-100%)
• Anson Funds liquidated entire 3.1M share position (-100%, ~$16.6M)
• Tower Research Capital completely exited their stake
• Overall: 33 institutions reducing positions vs. zero adding shares

What They’re Pitching

XXII’s flagship VLN® cigarette contains 95% less nicotine than traditional smokes—positioning the company as the “harm reduction” play in big tobacco. Key stats:

• Manufacturing facility in Mocksville, NC can churn out 45M+ cartons annually
• Proprietary patent portfolio = only low-nicotine combustible cig approved in US + key international markets
• Positions smokers to “control” their addiction

The Red Flags

Why smart money is leaving:

1. Sector headwinds: Tobacco sales declining globally; harm reduction is niche
2. Implied weakness in messaging: Emphasizing “consumers need control” can read as “existing products don’t work”
3. Timing questions: Corporate update announcements often precede disappointing guidance

The Bottom Line

When hedge funds (including Vanguard) are running for the exits at full speed while the CEO schedules investor presentations, it’s worth asking: what’s really happening behind the scenes? The patent moat is real, but fighting market headwinds is a different game.