Sheng Cao New Low-nicotine Cigarette. (Photo: Business Wire)

China Kangtai Cactus Biotech Inc. (OTCBB: CKGT), a vertically integrated grower, developer, manufacturer and marketer of a variety of cactus-based products in China, announced today that its Sheng Cao brand of new low-nicotine cigarettes has been approved for sale to consumers by the Chinese Center for Disease Control and Prevention (China CDC).

Sheng Cao new low-nicotine cigarette. (Photo: Business Wire)

The Company submitted the new cigarette for China CDC approval earlier this year. After a thorough analysis, which included quality control and toxicity tests, the CDC approved the Sheng Cao new low-nicotine cigarette for consumer use this year. This new cigarette is designed to contain lower nicotine and tar than most competing brands. The taste is very smooth and suitable for regular smokers who want to reduce their nicotine intake.

The Company said the new cigarette, which will be produced in Macau, will initially be introduced in Guangdong Province. The new cigarette is expected to generate approximately RMB 22 million (approximately US $3.4 million) in sales in 2011. Management said that upon successful initial market roll out, the Company expects to expand its marketing efforts to additional locations before the end of the year.

A photo of the Sheng Cao new low-nicotine cigarette is attached.

China Kangtai CEO Jinjiang Wang said, “This new cigarette demonstrates our capabilities and the quality of our cactus cigarettes, which are already widely accepted by consumers. Last year revenue generated from cigarette sales was $2.9 million. In the first quarter of 2011, revenue from cigarette sales was RMB 8.7 million (approximately US $1.3 million). We believe we have the lead in an important market niche that we are uniquely able to fill because of our ability to blend cactus with tobacco in a way that provides consumers the satisfaction that they expect from a cigarette while lowering the nicotine content. We anticipate this will be an important addition to our cactus cigarette product-line. The concept of a lower-nicotine cigarette is certain to attract more customers and we intend to heavily promote the special quality of these cigarettes to the market. We believe this will further broaden our market share and the outlook for our Company.”