Medical groups are urging the U.S. states that recently won a case against Juul Labs to use the money for tobacco prevention and cessation programs, according to Pew. The court case ended in a $438.5 million settlement.
The deal, which resolved an investigation by 33 states into Juul Labs’ marketing practices, requires Juul to pay states over six years to 10 years, prohibits Juul from further marketing to young people, limits where Juul products can be sold and advertised, bans flavors that haven’t been approved by the U.S. Food and Drug Administration and prohibits free samples and brand name merchandise marketing.
Groups, including the Campaign for Tobacco-Free Kids (CTFK), the American Cancer Society Cancer Action Network, the American Heart Association, the American Lung Association, Americans for Nonsmokers’ Rights and the Truth Initiative, called on the states involved in the settlement “to both build on the successes of the historic 1998 Master Settlement Agreement with the tobacco industry and avoid some of the mistakes that were made.”
The groups cited a CTFK report showing that of the $27 billion that states collected from tobacco settlements and taxes in fiscal 2022, only 2.7 percent was spent on programs to prevent kids from smoking and help smokers quit.
Several attorneys general have expressed intent to use the Juul settlement money for smoking prevention and cessation programs. The health groups urged the officials to “translate that admirable intention into a firm commitment expressed in the text of the final agreement.”
Smoking cost the U.S. economy $891 billion in 2020, almost 10 times the cigarette industry’s revenue of $92 billion, reports Medical Xpress, citing a new American Cancer Society study.
“Economic losses from cigarette smoking far outweigh any economic benefit from the tobacco industry—wages, and salaries of those employed by the industry, tax revenue and industry profit combined,” said Nigar Nargis, senior scientific director of tobacco control research at the cancer society.
“As a society, we can mitigate these economic losses through coordinated and comprehensive evidence-based tobacco control measures, which encourage people to quit smoking and prevent people from starting to smoke in the first place,” Nargis said.
Researchers used economic modeling that measured economic loss from cigarette smoking by state. Kentucky, West Virginia and Arkansas showed the highest losses while Utah, Idaho and Arizona showed the lowest losses.
“The damage this industry causes on individuals’ lives and our nation’s economy is horrifying,” said Lisa Lacasse, president of the American Cancer Society Cancer Action Network.
“It’s particularly alarming, but not surprising, to see some of the states with the highest economic loss have the weakest tobacco control policies in place,” Lacasse said. “We know what works to reduce tobacco use and lessen this burden, and it’s past time we get it done.”
The U.S. Department of Health and Human Services has a goal of reducing smoking to 5 percent of adults by 2030. “The Healthy People 2030 goal provides an important target that will help reduce smoking and correspondingly the negative economic impact of tobacco use,” Nargis said.
Australia’s prescription-only model for nicotine vaping has failed, according to Colin Mendelsohn, founding chairman of the Australian Tobacco Harm Reduction Association. Writing in Filter, he urges the country to adopt a more realistic regulatory model for nicotine products.
In October 2021, the Australian government introduced a policy that requires nicotine vapers get a doctor’s prescription and purchase supplies exclusively from pharmacies or international online vendors.
The regulations were intended to prevent youth vaping and to allow access for adults as a smoking-cessation aid. One year on, the policy has achieved neither of those goals, according to a report prepared by Mendelsohn.
Instead, the rules have created a thriving illicit market for unregulated vaping products that do not comply with Australian standards. Meanwhile, vaping by adolescents has reportedly increased in Australia. With no age controls in an unregulated market, vaping products are easily accessible by teens from stores and through social media.
Nicotine liquid should be an adult consumer product, sold from licensed retail outlets such as vape shops, convenience stores, tobacconists and general stores as it is in other countries.
While the prescription model has made it harder for adults legally access nicotine vapes, combustible cigarettes remain widely available.
According to two recent surveys, between 88 to 97 percent of vapers do not have a prescription and only 2 percent of purchases are made from a pharmacy. Exposed to frequent negative messaging by Australia’s medicines regulator, the Therapeutic Goods Administration, general practitioners have been reluctant to prescribe nicotine.
The only way forward, according to Mendelsohn, is to replace the prescription-only model with a legal and regulated retail market. “Nicotine liquid should be an adult consumer product, sold from licensed retail outlets such as vape shops, convenience stores, tobacconists and general stores as it is in other countries,” he writes. “There should be strict age verification and penalties up to loss of license for underage sales.”
Using vaping products rather than cigarettes leads to a substantial reduction in exposure to toxicants that promote cancer, lung disease and cardiovascular disease, according to new research from the Institute of Psychiatry, Psychology and Neuroscience at King’s College London.
Commissioned by the Department of Health and Social Care’s Office for Health Improvement and Disparities, the independent report represents the most comprehensive review of the risks of vaping to date. It found that, while vaping is not risk free—particularly for people who have never smoked—it poses a small fraction of the health risks of smoking in the short to medium term.
The report reviewed many aspects of vaping, including who is vaping and what products, the effects on health (both absolute and compared with smoking) and public perceptions of harm. The authors examined studies of biomarkers of exposure (measures of potentially harmful substance levels in the body) as well as biomarkers of potential harm (measures of biological changes in the body) due to vaping or smoking.
The strongest evidence came from biomarkers of exposure. An exploration of the available studies found that levels of tobacco specific nitrosamines, volatile organic compounds and other toxicants implicated in the main diseases caused by smoking were found at significantly lower levels in vapers. Among vapers, overall levels of nicotine were lower or similar to smokers.
When comparing biomarkers between people who vape and people who don’t smoke or vape, they were often similar, but in some cases there was higher exposure when vaping. The investigators therefore concluded that whilst less harmful than smoking, vaping is likely to sustain some risks particularly for people who have never smoked.
While the investigators are clear on the benefits of vaping vs smoking, they found that public perceptions are lagging behind. In 2021, only 34 percent of adults who smoked accurately perceived that vaping was less harmful than smoking, while only 11 percent of adult smokers knew that nicotine wasn’t the primary cause of the health risks connected to smoking tobacco.
Vaping has gained popularity among British adults. According to the latest data from the Action on Smoking and Health (ASH) Smokefree GB Adult survey, current vaping prevalence is 8.3 percent in 2022, compared with 7.1 percent in 2021 and 6.3 percent in 2020.
Vaping has also increased among young people. Data from the ASH Smokefree GB Youth survey of 11-to 18-year-olds in England show that current vaping prevalence (including occasional and regular) is 8.6 percent in 2022, compared with 4.0 percent in 2021 and 4.8 percent in 2020. Use of disposable vaping products has increased substantially over the last year. Vaping among young people who have never smoked remains very low at 1.7 percent.
“This important study is the latest in a series which carefully pulls together the science on vaping to help reduce the damage from smoking,” said Jeanelle DeGruchy, deputy chief medical officer for England, in a King’s College press note.
“Vaping is substantially less harmful than smoking so the message is clear, if the choice is between smoking and vaping, choose vaping. If the choice is between vaping and fresh air, choose fresh air.”
The world’s 15 largest tobacco companies have made limited progress since 2020 to reduce the harm of their products, with high-risk combustible products still accounting for around 95 percent of retail sales volume, according to the second edition of the Tobacco Transformation Index, an initiative of the Foundation for a Smoke-Free World.
The Index was created to accelerate the reduction of harm caused by tobacco use by ranking the world’s 15 largest tobacco companies on their relative progress or the lack thereof. The first Index was published in 2020.
Presented during the recent GTNF 2022 conference in Washington DC, The 2022 Index evaluates tobacco companies’ behavior across six categories and 35 underlying indicators that cover measures indicative of harm reduction, from product sales to capital allocation and marketing policies.
Swedish Match ranked first in the 2022 Index, with Philip Morris International, Altria and British American Tobacco in second, third and fourth places, respectively; Djarum of Indonesia ranked last.
The key takeaways from the 2022 Index findings are as follows:
Only Swedish Match sells a greater volume of reduced-risk products (RRPs) than substantially more harmful combustibles, due in most part to the popularity of its snus in Sweden and non-tobacco nicotine pouches in the U.S. A key feature underpinning the Index is its adoption of the Relative Risk Assessment, based on a systematic review of scientific studies of the health risks associated with 15 nicotine products.
Four Index companies directed the majority of capital and R&D investments toward RRPs. In addition, five Index companies, including three state-owned entities, made incremental investments or early indications of movement toward future production of RRPs during the review period.
However, tobacco companies are also failing to invest in harm reduction in low- and middle-income countries, with the vast majority of sales for their RRPs concentrated in markets with the highest disposable income. One obstacle is that several countries ban RRPs.
Transformation of the tobacco industry toward harm reduction remains inconsistent and in its early stages.
“Transformation of the tobacco industry toward harm reduction remains inconsistent and in its early stages,” said David Janazzo, Index program officer and interim co-president, executive vice president of operations and finance, and chief financial officer at the Foundation for a Smoke-Free World, in a statement.
“That said, the 2022 Index demonstrates that differentiation is forming across the largest tobacco companies, related to measures of commitment, performance and transparency. While some companies are making progress, others regressed. On the whole, they are all failing to deliver outcomes toward a world in which combustible, other forms of toxic tobacco, and smoking related death and disease are eliminated, in order to accomplish the Foundation’s mission of ending smoking in a generation.
“Based on the current trajectory of smoking rates, it is estimated that by the end of the current century up to 1 billion people will die of smoking. The majority of those will live in developing countries, which is why transformation of the tobacco industry is both essential and urgent.
“It is my hope that industry leaders will take heed of the findings in the 2022 Index to push forward and intensify efforts to strengthen harm reduction strategies and tactics.”
The 2022 Index is a reminder of how far tobacco companies have to go. The differing and at times hostile regulatory standards around the world have made implementation of harm reduction more challenging, but many opportunities are not yet fully maximized.
“Institutional investors such as banks and pension funds are increasingly looking at harm and harm reduction. The Index is an important tool for those investors to constructively engage and encourage change in the market,” said Erik Bloomquist, chair of the Index Technical Committee.
“The 2022 Index is a reminder of how far tobacco companies have to go. The differing and at times hostile regulatory standards around the world have made implementation of harm reduction more challenging, but many opportunities are not yet fully maximized.”
“This Dutch study is our second major national study to provide evidence of the powerful impact of banning menthol cigarettes on quitting, which supports proposed menthol bans in the U.S. and other countries,” said Geoffrey T. Fong, professor of psychology and public health sciences at Waterloo, and the principal investigator of the ITC Project in a statement.
Previous Canadian research also found a positive public health impact of banning menthol cigarettes.
In the most recent study, the research team surveyed a national sample of adult smokers of menthol and non-menthol cigarettes in the Netherlands before and after the EU menthol ban. Of the menthol smokers surveyed before and after the ban, 26.1 percent had quit smoking. This quit rate was higher than the control group of non-menthol smokers, of whom only 14.1 percent had quit.
In fact, the increased quit rate of 12 percent of menthol smokers after the European ban is greater than the increased quit rate of 7.3 percent found in an ITC study of the menthol ban that was in effect across Canada in 2018.
The World Health Organization’s Framework Convention on Tobacco Control calls upon countries to prohibit or restrict menthol and other additives that make smoking easier.
To date, 35 countries have banned menthol cigarettes. On April 28, 2022, the U.S. Food and Drug Administration announced a proposed rule to ban menthol in cigarettes and cigars. An ITC study published that day on the impact of the Canadian ban projected that a ban on menthol cigarettes in the U.S. would lead more than 1.3 million smokers to quit.
The Dutch study also found that one-third of menthol smokers reported continuing to smoke menthol cigarettes even after the ban. The tobacco industry markets a wide range of accessories to enable people to add menthol flavoring to tobacco products themselves.
“These tobacco industry actions undermine the effectiveness of the menthol ban,” said Marc Willemsen, co-author of the Dutch study and professor in tobacco control research at Maastricht University and scientific director of tobacco control at the Trimbos Institute. “By tightening the regulations to include these menthol add-ons, the impact of the menthol ban on quitting could be even greater.”
Sarah Bostwick discusses the significance of materiality assessments in PMI’s long-term strategy.
By Stefanie Rossel
In the world of investment, the sustainability of businesses was long considered a negligible financial risk. According to the Sustainable Finance Disclosure Regulation, a European piece of legislation introduced to improve transparency in the market for sustainable investment, a sustainability risk is an environmental, social or governance (ESG) event or condition that, if it occurs, could cause an actual or potential material negative impact on the value of investment.
As the effects of climate change became more noticeable, however, sustainability became an increasingly important consideration for companies, requiring them to adjust their risk management strategies. Today, a company’s ability to manage sustainability issues is thought to be related directly to its long-term growth. Institutional investors, private equity firms and hedge funds now tend to prefer companies complying with ESG principles.
The Covid-19 pandemic has added new challenges for businesses, showing them that factors such as workplace culture or executives’ behavior are having a growing influence on corporate performance and company reputation and hence need to be included in their risk management plans.
In order to develop a sustainability strategy, companies use materiality and stakeholders’ assessments. Materiality, a concept that defines why and how certain issues are important for a company or a business sector, is considered one of the most crucial elements to determine business risks and impacts in this process. A sustainability materiality assessment (SMA) is the backbone of sustainability reporting.
Philip Morris International is working to deliver a smoke-free future and evolving its portfolio to include products outside of the tobacco and nicotine sectors. In February 2021, PMI announced its ambition to expand into wellness and healthcare areas and deliver innovative products and solutions that aim to address unmet consumer and patient needs.
PMI conducted its first SMA in 2016 and updated the assessment in 2018, 2019 and 2021, according to Sarah Bostwick, head of sustainability stakeholder engagement at PMI. “Sustainability is at the core of PMI’s business strategy and is an opportunity for innovation, growth and the long-term value creation of the company,” she says. “Our sustainability materiality assessment forms the foundation of PMI’s sustainability strategy. It helps us to ensure that our efforts remain focused on those areas where we can have the greatest impact and that we continue to deliver relevant reporting to our stakeholders. To keep pace with our business transformation toward a smoke-free future and constantly evolving stakeholder priorities, it’s necessary to regularly update our sustainability materiality assessment.”
The periodic SMAs, adds Bostwick, allow PMI to monitor and adapt its business and long-term strategy to social, environmental, economic, political and technological changes. For the 2021 assessment, PMI partnered with BSD Consulting.
Double Sustainability Materiality Approach
PMI’s SMA follows a five-step process: Identifying ESG topics, gathering stakeholder perspectives, assessing outward impacts, assessing inward impacts and identifying the company’s most material topics. The assessment has embedded the concept of double materiality. In recent years, various standard setters and regulatory bodies have begun to refine the concept of sustainability materiality, with the European Union Corporate Sustainability Reporting Directive proposal and the International Sustainability Standards Board recently set up by the International Financial Reporting Standards Foundation Trustees both distinguishing between “single materiality” and “double materiality.”
The principle of double materiality acknowledges that businesses should assess both the risk and opportunities linked to ESG topics that can influence enterprise value creation (“inward impacts”) and the ESG impacts that a company can have on the planet and society (“outward impacts”). Furthermore, the concept of “dynamic materiality” recognizes that the financial materiality of an ESG impact can evolve over time.
In their foreword to PMI’s Sustainability Materiality Report 2021, BSD Consulting advisors explain that there are several advantages to this approach: “PMI gained deep insights that go far beyond generic sectoral or geographical approaches to match the company’s business model and dynamic transformation path. By considering emerging topics and aligning the process with internal risk management, PMI paved the way for pragmatic interim reviews and adjustments. In this way, the chosen approach allows the company to identify topics with medium-term to long-term strategic relevance for PMI and its business model as well as to dynamically adapt them to external or internal developments.”
Stakeholders play a key role in the assessment process. For its 2021 SMA, PMI expanded the group of stakeholders to participate, recognizing that there is value in integrating different perspectives into its analysis to deepen its understanding. In addition to soliciting input from employees, regulators, public health community, suppliers and civil society, PMI built on consumer understanding acquired over time (e.g., through studies on consumer perception of sustainability issues associated with the industry). The aim was to achieve a fair representation of its key stakeholders across the geographies it operates. Inputs were collected through an online survey in which around 150 internal and external stakeholders took part and in-depth qualitative interviews.
The company welcomes critical voices. “Constructive dialogue is essential to moving society forward,” Bostwick states. “To achieve the collective action required to solve the world’s most pressing challenges, we must include all voices, bringing together people with differing opinions, scrutinizing facts and finding common ground upon which to build. We will always have critics, and we remain committed to engaging with them honestly and transparently, pointing out the actions we are taking to address their concerns and welcoming feedback on how we can do better. In line with the principle of double materiality, the assessment consists of a five-pronged approach that evaluates both outward and inward impacts and accounts for the expectations of the company’s stakeholders.”
Emerging Topics Identified
While the company’s 2021 list of topics accounted for those assessed during its 2019 sustainability materiality analysis, it underwent significant changes that impact the comparability of results, says Bostwick. “Most topics were renamed as we sought to define them in a neutral way, accounting for both their potential positive and negative impacts. We also introduced new topics, such as ‘innovation in wellness and healthcare’ or ‘laws and regulations,’ to reflect changes in our business and value proposition and the rapid evolution of the regulatory landscape; bundled topics that were deeply connected, for instance, consolidating under ‘economic contribution’ aspects related to fiscal practices or illicit tobacco trade prevention; and split some topics that merited a more granular assessment, for example, decoupling ‘health and safety at work’ and ‘employee well-being.’ Lastly, reflecting the maturity of sustainability at PMI, we did not consider ‘human rights’ as a standalone topic but rather as an ever-present topic pervasive across our company and all ESG issues.”
Furthermore, the company identified three topics that were not included in the list of most material sustainability topics but that it expected to gain momentum in the future: human capital development, biodiversity and water. Their selection, Bostwick points out, relied on the identification of major trends in the sustainability arena, coupled with insights gathered throughout the various steps of the materiality process.
According to Bostwick, the SMAs’ findings have directly impacted PMI’s operations. In 2021, the company acquired Vectura Group, an inhaled drug development solutions specialist; Fertin Pharma, a developer and manufacturer of pharmaceutical and well-being products based on oral and intraoral delivery systems; and OtiTopic, a respiratory drug development company with a late-stage inhalable acetylsalicylic acid candidate for the prevention and treatment of acute myocardial infarction.
The emergence of “innovation in wellness and healthcare” as a material sustainability topic concretely manifests “changes to our strategy and vision that prompted the revision of our Statement of Purpose, expanding it to no longer have as its last horizon to achieve a smoke-free future but also to encompass our strategic efforts to venture toward becoming a wellness and healthcare company,” Bostwick says. “Notably, we aspire to achieve at least $1 billion in net revenues from such sources by 2025. In wellness, we are developing and looking to commercialize scientifically substantiated consumer health products and solutions with the aim to improve people’s lives. In healthcare products, we have already committed resources to its development pipeline of over-the-counter and prescription products.”
Optimized Strategy
As a consequence of the SMA’s results, PMI has also reframed its ESG framework to better articulate the ESG topics the company should focus on. “This framework recognizes two distinct forms of issues: Those that relate to our products—what we produce—which are part of the ‘Product Impact’ pillar and those related to our business operations—how we produce—which are part of the ‘Operational Impact’ pillar. We subsequently classified each topic based on its environmental, social or governance-related nature,” says Bostwick
“This approach allows us to appropriately highlight that, consistent with our sustainability materiality analysis results, addressing the social impacts generated by our products is the core of our strategy. The biggest and most pressing negative externality our strategy aims to address is the health impacts of cigarette smoking. This is the most important contribution we can make to public health and is the cornerstone of PMI’s purpose and business strategy.”
Following an acceleration of the company’s targets for carbon neutrality in its direct operations by 2025 and net-zero emissions across its value chain by 2040, the company aims to further develop its biodiversity strategy, covering all relevant areas of the company and its integration within its climate, water, forest and waste reduction efforts. “Noting the relevance that biodiversity and water have in our overall climate strategy and aims to preserve nature, we look forward to introducing 2025 targets that reflect our level of ambition,” Bostwick explains. “We expect to have a full set of targets and actionable milestones by the end of 2022.”
Stefanie Rossel is Tobacco Reporter’s editorial contributor. An experienced trade journalist, she combines sharp reporting skills with in-depth knowledge of the tobacco and vapor industries. Prior to joining Tobacco Reporter, Stefanie was editor-in-chief at Tobacco Journal International, where she worked for a decade. Fluent in English, German and French, Stefanie covers tobacco news around the world. She is based in Germany.
While lambasted by anti-smoking activists, the tobacco industry’s move into pharmaceuticals may well turn out to be a positive for public health.
By Cheryl K. Olson
“The pharmaceuticalization of the tobacco industry.” This awkward phrase comes from a 2017 Annuals of Internal Medicine article referring to industry moves into noncombustible nicotine products. But recently, it’s gaining some literal truth. Legacy tobacco companies are stepping up diversification into pharmaceutical ventures.
Given that their current business direction is stalling, new adjacent opportunities that let tobacco companies use their specialized knowledge (say, of the tobacco plant genome or lung physiology or means of delivering substances) make sense. It may seem counterintuitive, or ethically iffy, for these companies to start offering solutions to problems they helped create. But they may frankly be well placed to do so because of their deep expertise. The criticisms of current industry moves into medical research and pharmaceuticals, such as Philip Morris International’s acquisition of Vectura and Fertin Pharma, seem more rooted in emotion than in practical concerns about effects on public health.
A Tour of Recent Criticisms of Diversification
Let’s review some recent criticisms and attempt to separate the moral from the practical. Take this September STAT+ article by Olivia Goldhill, titled “Tobacco Giant Philip Morris is Investing Billions in Health Care. Critics Say It’s Peddling Cures for Its Own Poison.”
The tone of the article makes ordinary business behavior sound sinister. Vectura Fertin Pharma, a firm combining two companies previously acquired by PMI, was “quietly incorporated.” PMI has been “racking up patents and taking over healthcare companies, an unlikely pivot that has accelerated dramatically in the past year.” PMI has also been “poaching considerable regulatory and pharma expertise.” All this in the article’s first two paragraphs.
The recent move by Matt Holman, who was director of the Office of Science at the Food and Drug Administration’s Center for Tobacco Products (Goldhill mislabels him as head of the CTP), to a position at PMI is described as a “move that shocked public health and tobacco researchers.” Why the surprise? Employees cycling from the FDA to the pharmaceutical companies they reviewed is commonplace; back in 2016, Time magazine called it “a revolving door.”
When PMI purchased Vectura, best known for making asthma medicine inhalers, the Reuters headline read, “Philip Morris seals deal for U.K.’s Vectura despite health group concerns.” The chief executive of Asthma U.K. and the British Lung Foundation stated, “There’s now a very real risk that Vectura’s deal with big tobacco will lead to the cigarette industry wielding undue influence on U.K. health policy.”
The U.S. reaction was similar. A joint statement by the presidents of the American Lung Association and American Thoracic Society called the acquisition a “reprehensible choice” by PMI. They were concerned that PMI might use Vectura’s inhalation technologies “to make their tobacco products more addictive.” They raised the prospect that PMI “could further profit from the disease their products have caused by now selling therapies to the same people who were sickened by smoking.”
The idea of cigarette companies profiting from conditions such as asthma and lung disease was reportedly also raised by British government officials, with the U.K. business minister asking for information on PMI’s plans for Vectura.
A deliberate company strategy to invest simultaneously in selling addictive poison and in peddling cures for that addiction would indeed be reprehensible. Is that what’s happening here? Or are tobacco companies making effortful attempts to find paths to replace the profits from cigarettes with profits from products that don’t harm and might improve public health?
Time will tell. PMI’s website states, “We are focused on our mission to one day stop selling cigarettes.” The Guardian newspaper’s coverage noted that while the Vectura acquisition was part of PMI’s smoke-free vision, “the company still makes about three-quarters of its $28 billion in annual revenue from ‘combustible’ products that involve the burning of tobacco.”
Critics of the tobacco industry didn’t always take such a dim view of moves away from cigarettes. A quick search in Google Scholar for “tobacco industry diversification” brought up this 1985 piece by Alan Blum in the New York State Journal of Medicine. He stated, “Some health professionals believe that criticism of tobacco companies for promoting cigarette smoking should be tempered because they have become conglomerates that are diversifying into nontobacco products and services. By encouraging such diversification, it is reasoned, health professionals can help expedite the phasing out of smoking while tobacco companies can have an opportunity to replace the resultant lost revenue.”
Blum’s concern was that this belief among “individuals working to eliminate smoking may be misguided.” This was not because those individuals saw industry diversification as a potentially positive step. Rather, he thought diversification wasn’t happening fast enough. Blum noted that tobacco companies were not decreasing investment in cigarette manufacturing and that “the percentage of total profit accounted for by tobacco sales is still the highest of all sources of revenue for tobacco companies.”
“Those It Employs [or] Funds Are Therefore Banned”
PMI’s announced acquisition of Vectura triggered efforts to exclude its employees and their research. The Drug Delivery to the Lungs conference terminated Vectura’s sponsorship. A Thoraxeditorial titled “Vectura and Philip Morris: The leopard has not changed its spots” stated that “The tobacco industry, those it employs and those it funds are therefore banned from membership of professional societies, including the British Thoracic Society (BTS).” The BTS would “exclude the tobacco industry as a legitimate partner in science and education,” including “publishing in respectable journals” and collaborations with universities. The editorial warns that “Vectura employees will need to consider their future.”
The treatment Vectura’s employees received is far from unique. Ian Fearon, director of whatIF? Consulting, has conducted research in a variety of settings and helps manufacturers write up their scientific data for publication. “The barriers to publication for tobacco companies and independent ENDS [electronic nicotine-delivery system] manufacturers are high, with many journals flatly refusing to even accept a paper to undergo peer review,” he said. “One major irony is the ‘we need the industry to be transparent’ phrase, yet the reality is that the number of journals willing to publish manufacturers’ data, despite its potential importance in assessing public health impacts, is small and diminishing.”
Fearon noted the criticism Juul received for “buying out” a 2021 special issue of the American Journal of Health Behavior to fully present their findings, which were a comprehensive examination of the potential impact of Juul on public health. Such publishing fees are common in academia; Juul even paid extra to make the articles free to all readers.
Derek Yach, formerly with the World Health Organization and the Foundation for a Smoke-Free World, equates the opposition based on the tobacco industry’s past bad practices to the 1980s U.S. boycott of Nestle. “That pushed NGOs [nongovernmental organizations] and WHO to vilify them for decades despite changes in their marketing way back,” he said. “To this day, in many public health leadership settings, Nestle is a real villain, regardless of all they have done to change. I suspect that playbook will apply here too.”
Yach sees the downside of diversification as less about ethics and public health and more about the practical difficulties. “It’s all about company focus and the inevitable clash of cultures—a pharma culture versus a tobacco company one, for example—and as a result, the ability to manage the transition.”
David Sweanor
Thinking About Diversification: A Conversation with David Sweanor
David Sweanor of the Centre for Health Law, Policy and Ethics at the University of Ottawa has long monitored tobacco company behavior.
Tobacco Reporter: Why are you interested in the issue of tobacco companies diversifying into things like pharmaceuticals?
Sweanor: My main interest is public health policy: How do you end up with a healthier population? Is this doing anything that’s going to create poorer health—in which case, there’d be a need to oppose it or try to regulate it in some way? Is it going to be neutral in terms of public health? Then, who cares who owns these companies?
If it’s something that could actually be good for public health, then we should be supporting it. And there’s reason to believe this could be the case. When companies have loads of resources to throw at something, and if this signals more of a move to transformation within the industry, it would be incredible for public health.
If they are working on [inhalation] technologies for lower risk alternatives to cigarettes, we have the potential for enormous breakthroughs. If we can get any of the major companies to really switch to being all-in on risk reduction, it would completely change the environment. The impact globally would be remarkable and happen very quickly.
If you want to get tobacco companies to switch to being in favor of transformation, the last thing you want to do is prevent them from doing things that would aid transformation. If you’re trying to get automobile companies to switch to electric cars, don’t prevent them from buying companies with battery technologies. You’re forcing them to continue to focus on internal combustion engines.
What do you see as valid and invalid criticisms of this diversification?
No valid ones immediately come to mind. If they were buying up technology that gave a far better alternative to cigarettes and then trying to kill that, then yeah.
It’s easy to talk about the invalid criticisms. A really good example of that is in Canada, where Medicago, based in Quebec City, developed a vaccine for Covid-19. In developing countries, this vaccine would work well because it doesn’t need to be stored at cold temperatures. Philip Morris has an indirect holding of about 30 percent in Medicago. Anti-tobacco groups attacked the government for approving the vaccine, and WHO refused to approve it.
What’s the thinking behind that? It’s saying: We don’t like this company because we think it’s done bad things in the past. To deal with this, we’ll prevent them from doing good things now. They created an epidemic of disease from smoking that became larger and lasted longer than it should have. So we’re going to prevent them from doing things that could reduce this epidemic of disease from Covid to make it last longer than it should.
Are people following the principles of the Enlightenment or the Inquisition? So much now with mainstream anti-tobacco groups is the latter. We don’t care about the quality of your work; we won’t give you a platform to discuss or debate it. That some affiliation you have is more important than the knowledge you bring is pretty reprehensible. It’s like saying Roman Catholics are not allowed to express their views.
What do you see as potential benefits to public health from this diversification? For example, Matt Holman’s new position as vice president of U.S. scientific engagement and regulatory strategy at PMI.
Look at the counterfactual. If they don’t do that, the only people working in cigarette companies working on transformation spent their careers working on and understanding and benefiting from cigarettes. If General Motors says, “we’re hiring engineers who understand electric mobility rather than hydrocarbons,” isn’t that a good thing? How can you transform if all the people in senior positions have their expertise in internal combustion engines?
We see this in high tech all the time; one company will buy another to get the expertise of their employees. You need them at the table when you make decisions on where to go with the next generation.–C.K.O
Addendum
In the main article above, I stated that the boycott of Nestle from the 1980s has had a lingering negative effect on WHO and many public health leaders’ views of the company many decades later. This despite Nestle being a global leader in addressing food insecurity, sustainable agriculture and the use of 21st nutrition science (see the company’s 2021 annual report).
In the second half of October, Nestle’s past came back to haunt the company. The WHO Foundation, set up to build innovative private public partnerships, banned future Nestle contributions despite having originally accepted a grant for their work on addressing Covid-19.
The WHO Foundation already bans contributions from tobacco and arms manufacturers though it is unclear how “tobacco” is defined. Does it include governments with state monopolies? Does it include standalone e-cigarette, or nicotine pouch companies? Does it distinguish between companies where revenue from reduced risk products is increasing while combustible revenues are decreasing? Probably not.
Labelling companies as good or bad is the far easier option. But that option that ignores serious transformation and the opportunity to nudge and support the good emerging faster.
Derek Yach
Cheryl K. Olson is a California-based public health researcher who specializes in behavioral health issues and consults on tobacco product behaviors via McKinney Regulatory Science Advisors. She spent 15 years on the faculty of Harvard Medical School.
Not all smokers will be put off by the ‘dissuasively’ colored cigarette papers promoted by health activists.
By George Gay
Writing in this magazine two years ago about the pressures being placed on paper suppliers to the tobacco manufacturing industry, I claimed, uncontroversially I think, that the market for combustible cigarettes was declining. Later in the piece, and more controversially, I speculated that the part of the decline in demand for combustible cigarettes being caused by their substitution by vaping devices might slow because of policies being followed by some authorities.
Although that speculation still has validity today in many parts of the world, significantly in countries with big populations, such as China, India and the U.S., in the U.K., there has been a development that is aimed at putting a different hue on things.
In June, Javed Khan published his U.K. government-commissioned review into government policies aimed at reducing the incidence of tobacco smoking in England to 5 percent by 2030, Making Smoking Obsolete. As part of that review, Khan suggested the government should rethink how cigarettes look—that it “should use every part of the cigarette, and what’s in the pack, to communicate the harms of smoking and offer opportunities to quit.” He gave three examples of what he was getting at:
mandating anti-smoking messages on cigarette sticks, such as the number of “minutes of life lost” per cigarette;
using dissuasive colors (like green or brown) on individual cigarette sticks or hand-rolling papers; and
[including] cigarette pack inserts that provide information on the health benefits of quitting, supported by web links that direct smokers to support for stopping smoking.
I am little interested here in the third idea, though my concern would be that the information provided would be grossly misleading as is much of the “information” currently churned out on tobacco smoking. And I would say just two things in relation to the first. One is that you must always be careful what you wish for. Before mandating the printing onto cigarette paper of the estimated number of minutes of life lost to smoking those cigarettes, I would suggest checking whether this might prove to be a promotion among some young people, especially in the short term. Youngsters, at least those who might be drawn to smoking, tend to be perverse in some ways as was proved fairly conclusively when, in the 1990s, students in the U.K. took the Death brand cigarettes to their hearts. The second thing I would say is that, as far as I am aware, we possibly all lose more minutes of life to pollution than smokers lose to smoking, but of course it is difficult to disseminate the pollution figure because you cannot write on air no matter how polluted it is.
Perception Matters
But it is the second idea that interests me most. To my way of thinking, you have to try to be objective when describing and talking about colors, not least because not everybody perceives or experiences the same color in the same way. For instance, when the idea of standardized cigarette packaging was first raised in Australia, it was suggested that the background color should be an unattractive olive green. This idea went down like a lead balloon with Australian olive producers, and references to olive green were quickly shelved.
In perhaps trying to sidestep such issues, Khan makes what to me is the mistake of claiming that all greens and browns are “dissuasive,” though I should point out that in saying this I am assuming he is using the word “like” in the bracketed phrase “like green and brown” to mean “such as” green and brown, not colors that are similar to green and brown, a concept that only an artist might be able to understand. In support of this claim, he references a web survey carried out among 281 adolescents (16–20 years of age) in Norway, though that survey references at least one other previous survey, which was carried out in the U.K. The Norway survey, which seemed to have investigated the reactions to yellow-colored and green-colored cigarette papers (as well as reactions to products with printed warnings) rather than green and brown, was summed up in an abstract that concluded: “This study supports earlier findings and suggest[s] that the use of unpleasant colors and warnings printed directly on cigarette sticks could increase perceived harmfulness, reduce notions of good taste and possibly reduce desires to experiment with cigarettes in adolescence.”
The first thing that has to be said about this conclusion is that it seems rather uncertain of itself. It is less than 40 words in length, but it manages to cram in at least three doubting words: “suggest[s],” “could” and “possibly.” This is unsurprising in a way. I doubt that it would be possible to find a color that was widely dissuasive, though a certain hue of a certain color might prove to be more so. What is an unpleasant color is in the eye of the beholder and might even be the subject of fashion movements. And, of course, people, especially young people, tend to get used to things changing. Pasta that was rendered blue, a color not usually associated with food, especially savory food, would probably meet some resistance from consumers, but they, especially the young, would surely get used to it.
In any case, if there were such a thing as colors that were unpleasant in the eyes of everyone, as the conclusion appears to suggest, it seems to me that the research carried out in Norway would be rendered pointless. It stands to reason that an unpleasant color applied to a consumer product that was previously another color would make that product less attractive, though, once again, it is likely that, over time, consumers would get used to it. Not that I think such considerations would dissuade many of the people who carry out such research. Rather, these considerations would probably be seen as a reason why scientists should, in the usual way, call for further study into this issue—further study grants to be used to make life a little more unpleasant for smokers.
There is also the issue of what green signifies. I would imagine that if a cigarette manufacturer launched on its own initiative a green cigarette, it would be pilloried by the anti-tobacco lobby, the media and possibly other manufacturers for trying to imply that the product was environmentally friendly and, by extension, healthier. Something similar has happened before in Europe, and the U.S. Food and Drug Administration makes such a link.
Hypocrisy
But the real issue is whether it is fair or, indeed, whether it makes sense to foist onto, say, a 40-year-old committed cigarette smoker in the U.K., a product variation that a web survey found made the product less attractive to a small number of adolescents in Norway. Not to mention that doing so amounts to rank hypocrisy. As above, the purpose of mandating that cigarette papers are available only in green or brown would be to make the cigarettes unattractive to smokers—that is, to ruin their enjoyment of them. Now the health evangelists might wring their hands and say they seek this only for the good of the smokers and their physical health, but they have to realize that once a smoker has made a decision to smoke, it is no business of those evangelists. Smokers are adults who are entitled, legally, to enjoy a tasteful, fragrant, satisfying and otherwise appealing product presented in attractive packaging. Goodness knows, they pay enough for this product.
Now, let me explain what I mean by hypocrisy. Outdoor air pollution causes more deaths worldwide than tobacco smoking. It speeds up climate change and is a major cause of the biodiversity crisis, and yet we allow automobiles, which comprise one of the major causes of such pollution, to be sold in the most attractive forms imaginable. If it weren’t for hypocrisy, car design, like cigarette design, would have been heavily restricted so as to make people spurn these vehicles. Automobiles would come in a single “unattractive” background color adorned with health warnings covering everything from what happens when a pedestrian, especially a child, is hit by one to what happens to the lungs, especially young lungs, when they are hit by carbon dioxide and nitrogen oxide emissions. There would be no heaters or no air conditioning in automobiles, and the seats would be made from unadorned, used tires so as to make traveling uncomfortable. There would be no tops and no windscreens so that drivers and their passengers would have to wear goggles to keep (the quickly diminishing number of) insects out of their eyes. And, right now, somewhere, a person publishing a government-commissioned review would be recommending that all automobiles be fitted with square, solid-rubber wheels—brown ones with unevenly distributed knobs on them.
Priorities
Quite what will be the fate of the Khan review and his call for colored cigarette papers must be in doubt. For one thing, you have to wonder if any research has been done into whether adding pigments to cigarette paper would increase the toxicity of cigarettes, whether it would impede the technologies put in place to ensure that carelessly discarded cigarettes extinguish quickly, whether it would improve the taste of cigarettes and make them more attractive, or whether it would cause any other unintended—read: ill-thought-out—consequences. My bet is that the answer to those questions is no and that the only people who would gain in the short term from such a proposal would be the scientists who would be called on to carry out such research—and the follow-up research they would recommend.
Secondly, the review was commissioned by a government that was falling apart and that, as I write, is de facto leaderless and wallowing in internecine battles as two woefully inadequate figures fight over who should take on the mantle of further undermining the U.K.’s tottering democracy and dragging further into impoverishment the long-suffering people of these increasingly septic isles. I write increasingly septic with conviction because, while the government is concerning itself about whether cigarette paper should be green, brown, puce, tomato red (my bete noire) or whatever color the most recent health minister might find unattractive, it is allowing water companies to discharge increasing and illegal amounts of raw sewage into our rivers and coastal waters.
Why worry about the dangers of smoking when the air around you is putrid, the water around you is a lavatory and food crops are failing in a drought because, presumably, farmers are unable to irrigate given the low level and toxic nature of the rivers? Not to mention that, largely because of the Brexit dividend, “even if the crops were to survive, there would be nobody to harvest them.”
George Gay is Tobacco Reporter’s European editor, but his territory spans the globe. Based in London, George has covered the tobacco industry since 1982, initially for a U.K.-based publication and since 2004 for Tobacco Reporter. George’s understanding of industry issues, combined with his keen sense of observation and dry wit, have earned him a loyal following among Tobacco Reporter’s readers.
Tobacco growers reflect on the challenges and opportunities facing their business during the ITGA’s 2022 Americas and Africa Regional Meetings.
By Ivan Genov
In August 2022, after almost three years of Covid-19-related disruptions, the International Tobacco Growers’ Association (ITGA) organized two in-person meetings—one in Santiago de los Caballeros, Dominican Republic, for the Americas region and another in Lusaka, Zambia, for the Africa region. The much-awaited events brought together ITGA members, partners and key industry stakeholders to discuss the burning issues of the day and the appropriate ways to mitigate the negative effects of the current multi-vector crises.
Participants gathered from Argentina, Brazil, Colombia, the Dominican Republic and the U.S. as well as Malawi, Tanzania, Zambia and Zimbabwe, among other countries. Having already visited the Oriental region (Bulgaria and North Macedonia) earlier in the year, the ITGA is now preparing for its first physical annual general meeting, to take place in Castelo Branco, Portugal, since 2019.
Costs of Production—Drastic Growth in Most Markets
Although many topics were discussed during the Americas and Africa regional meetings, one stood out—the growing costs of tobacco production. In the U.S., growers continue to face challenges related to unavailability of labor and increasing costs of inputs. Local associations have reported that fertilizer costs alone exceed $1,000/ton. These factors are leading to the most expensive crop in the country’s history. In Brazil, current costs of production are also up significantly, between 27 percent and 29 percent for different tobacco types. In Zimbabwe, the growth is 25 percent against the 2021 crop. This is not an isolated event for the two regions. In Europe, the situation is no different. Tobacco growers in Verona, Italy, have revealed that energy costs have increased fivefold, gas has tripled and growers’ viability is once again in danger. Essentially, growers from nearly all ITGA member associations are afraid that if pricing does not adequately reflect the ongoing economic difficulties, the sector will be in serious long-term trouble.
Participants in ITGA’s African region meeting in Zambia (Photo: ITGA)
Leaf Updates—Production Decreases in Leading Tobacco Growing Countries
The global leaf situation was the other key point discussed by growers. Some of the biggest tobacco producing countries showed notable volume slowdowns during the year. In Brazil, the estimated 2022 crop is about 570 million kg, down from 628 million kg in 2021. The flue-cured Virginia (FCV) share of the totals is 92 percent. In the current season, around 40,000 fewer individuals were involved in the farming of the crop, or a total of just over 600,000 people. Nevertheless, pricing in the country is also up, firmly above the $3 mark for both FCV and burley.
In Argentina, the total production volumes are around 92 million kg, down from 101 million kgs in 2021. In the U.S., 2022 burley tobacco production is 2 million kg less, or 27 million kg, but dark air-cured tobacco planting area is on the rise. This is in part driven by stable consumer demand for smokeless tobacco products, limited substitutes for U.S. quality dark air-cured tobacco and greater profitability for local growers. In the U.S., popular agricultural commodity prices have sharply risen since 2020, providing viable alternatives to local growers.
In Zimbabwe, the total quantity of tobacco sold in 2022 is around 205 million kg against 212 million kg in 2021. Average pricing has improved but at a slower rate compared to production costs. The total number of growers is also down 14 percent to around 136,000 people. One of the leading burley producers in the world, Malawi produced 83 million kg of the tobacco variety, or a yearly decrease of 21 percent. In Zambia, production of FCV is up around 2 million kg to 32 million kg, but burley is down 2 million kg to 3 million kg. In Zambia, while production costs have nearly trebled, pricing has only moved up from around 7 percent to 10 percent for different tobacco types.
Delegates at the ITGA Americas region meeting in the Dominican Republic (Photo: ITGA)
Regulations—ITGA to Get Growers Back in Discussions
ITGA CEO Mercedes Vazquez focused on the World Health Organization Framework Convention on Tobacco Control (FCTC) Article 5.3, regarding industry interference, and Article 17, covering the need to promote economically viable alternatives to tobacco production to prevent possible adverse social and economic impacts on populations whose livelihoods depend on the crop. Unfortunately, Article 17 has been highly underestimated. Implementation at country level is poor or simply nonexistent. The WHO FCTC has not provided significant technical nor financial support to growers. The 15-year efforts of tobacco growers demanding inclusion at the FCTC Conferences of the Parties (COP) and how Article 5.3 was misused to prevent growers and their legitimate representatives from attending meetings was also discussed. Tobacco growers will, from now on, put high pressure to ensure their participation and will do their utmost to guarantee their legitimate representation at the future COP. The next one will take place in Panama in 2022.
Growers were briefed about incoming initiatives, including the regulatory push in the U.S. to prohibit menthol as a characterizing flavor in cigarettes and all characterizing flavors other than tobacco in cigars. As a reference, menthol accounts for around a third of the U.S. cigarette market. The U.S. administration is also considering requiring tobacco manufacturers to lower the nicotine in all cigarettes to levels that are no longer addictive. If enacted, these policies are likely to radically change the industry dynamics in one of the most profitable tobacco markets in the world. The other important regional initiative—the European Union’s €4 billion ($4 billion) Beating Cancer Plan, based on a goal of creating a tobacco-free generation by 2040, is also likely to shape up legislative changes in a variety of markets and affect the supply chain.
Other Key Discussions—from Cannabis to Climate Change
Among the other topics discussed was hemp as a potential alternative to tobacco in the U.S. However, initial euphoria led to massive overproduction and a corresponding price crash. Although small-scale projects for crops, including cannabis, are being carried out in both the Americas and Africa, the consensus opinion is that regulatory clarity is still lacking.
Some markets, including Malawi, Zimbabwe, Argentina and Colombia, among others, have taken steps in their respective local regulatory frameworks regarding cannabis production. However, any meaningful opportunities are nowhere near the opportunities provided by tobacco in these regions at the moment.
Another topic that was discussed is related to abnormal climate events impacting the crops. In Zambia alone, over the course of the past three decades, the impact of floods and droughts have been estimated to cost the country around $13.8 billion. Small-scale projects have made inroads to support farmers, not only in tobacco, but it is feared that much more trouble is coming—something that no one is adequately prepared for.
Persistent Issues and Growers’ Resilience
Tobacco growing, much like all agricultural activities, remains a difficult calling. While many businesses could afford to keep their workforces at home during the Covid-19 pandemic, growers had no other choice but to remain on the fields. The sector proved to be more resilient than many anticipated, and high-quality tobacco leaf continues to be delivered.
In the past couple of years, tobacco and nicotine consumption has remained stable. The principal category for the entire industry, cigarettes, is even growing in some of the main global markets. Growers are aware that they only take a small fraction of the total industry value while their fundamental role is being constantly undermined. For the industry to survive, prices will have to catch up with the growing costs of production.
At the same time, the war in Ukraine is putting severe pressure on key agricultural commodities. Many countries, especially in Africa, rely heavily on such imports from Russia and Ukraine. The countries that have the capacity to produce the scarce products could find easier diversification options. However, the growing inflation and general economic uncertainty will keep the international situation tense. Growers have proven their resilience, but their legitimate demands cannot be ignored anymore.
Ivan Genov is ITGA’s manager of tobacco industry analysis.
