Category: Also in TR

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  • Back Choice, Beat Prohibition

    Back Choice, Beat Prohibition

    An inconvenient truth: Some people enjoy smoking. (Photo: pikselstock)

    There are millions of adult smokers who don’t want to quit. Their preference should be respected.

    By Simon Clark

    The announcement in December that the New Zealand government intends to ban the sale of tobacco to anyone born after 2008 is merely the latest example of a process dubbed “creeping prohibition.” Smoking bans, the prohibition of flavored cigarettes and punitive taxation are just three measures that have only one aim and that’s to eradicate smoking and create a utopian “smoke-free” society.

    The health risks associated with smoking have been well known and widely understood for decades. As a result, millions of people have stopped smoking. Many more have chosen never to smoke. Nevertheless, many adults still enjoy smoking and don’t want to quit, and everyone—the tobacco industry, vaping advocates, public health campaigners and politicians—should respect their choice. Instead, a key stakeholder, the adult smoker who doesn’t want to quit, is increasingly marginalized and ignored.

    In 2016, as director of the smokers’ group Forest (Freedom Organisation for the Right to Enjoy Smoking Tobacco), I commissioned a report called “The Pleasure of Smoking: The Views of Confirmed Smokers.” Despite making every effort to promote it, the study was largely ignored, but it’s still relevant, and if we were to commission the same report today, the results would, I believe, be very similar.

    In brief, a survey of over 600 smokers by the Centre for Substance Use Research (CSUR) in Glasgow found that nearly all respondents (95 percent) gave pleasure as their primary reason for smoking. Most of those surveyed (77 percent) expected to smoke for many years, with only 5 percent envisaging a time in the near future when they might have stopped. More than half the respondents (59 percent) had used alternative nicotine-delivery products such as e-cigarettes. Few, however, were persuaded to switch permanently from combustible cigarettes to vaping.

    At the time, Neil McKeganey, director of the CSUR, said, “This research has provided considerable detailed information on the way in which smoking is viewed by a group of confirmed smokers, a body whose opinions are rarely taken into account by government or tobacco control groups. The implications of these findings from a smoking cessation perspective are significant because there is a clear gulf between the way smoking is typically viewed as a negative, somewhat reprehensible, behavior and how the smokers themselves saw smoking as a source of pleasure—a choice rather than an addiction.”

    One company that wants to eradicate combustible tobacco is tobacco giant Philip Morris International. In 2018, the company said it wanted to phase out cigarettes as soon as possible. In 2019, the then managing director of Philip Morris U.K. said, “There is no reason why people should smoke anymore.” Last year, the company even urged the U.K. government to ban the sale of cigarettes within a decade. While I applaud and support PMI’s commitment to developing reduced-risk products, this represents an outrageous attack on consumer choice—never mind rival companies—and is an insult to the many adults who enjoy smoking, don’t like vaping and don’t want to quit smoking.

    In addition to funding the Foundation for a Smoke-free World, launched in 2017, PMI also funded, in 2019, an online initiative called Quit Cigarettes. It was created by Change Incorporated, part of the VICE Media group. Headlines on a dedicated campaign website included: “How Smoking Increases Chances of Genital Warts,” “How Smoking is Ruining Your Sex Life,” “Is Smoking a Deal-Breaker on Tinder?” “How Cigarettes Blight British Seaside Towns” and “This is How Smoking Makes Your Penis Shrink.” The Change Incorporated website also included “witty” one-liners such as “Definition of a cigarette—a bit of tobacco with a fire at one end and a fool at the other.” To be fair to PMI, a disclaimer stated that “VICE maintains editorial control, so Philip Morris International may not share the views expressed,” but it’s hard to argue that the campaign did not broadly complement PMI’s own anti-smoking agenda.

    To be clear, Forest, which was founded in 1979, is fully supportive of efforts by PMI and other companies to develop, manufacture and market risk reduction products, be it e-cigarettes, heated-tobacco, nicotine pouches or products yet to be invented, because we believe in choice. We also support efforts to educate and inform consumers about the relative risks of different nicotine products so they can make informed choices, including not to smoke or vape.

    What we cannot support are campaigns and strategies that appear to undermine or belittle smokers who don’t want to quit while targeting a “smoke-free world” that, in our view, can only be achieved by creating a society in which generations of consumers are not only denied a choice of combustible products but are increasingly restricted from using them and punished or ostracized when they do. If smokers choose to quit or switch to reduced-risk products voluntarily and without coercion, there would be no cause for complaint. Embracing or meekly accepting measures designed to prevent adults from smoking is another matter.

    Unsurprisingly, several vaping advocacy groups and companies have also jumped on the anti-smoking bandwagon. In 2020, a leading vaping company in the U.K. backed calls to ban smoking outside pubs in England. Another wanted to see less smoking on TV. Meanwhile, a global vaping advocacy group is currently running a campaign called “Back Vaping, Beat Smoking.” The campaign logo features a boxing glove, and one campaign banner features a boxing ring with two boxers inside the ring. One represents vaping, the other smoking. The figure that represents “smoking” is cowering in a corner. The message is clear and, in my view, unnecessarily provocative. There are many positive ways to promote vaping to smokers, and this isn’t one of them.

    More anti-smoking messaging was evident at a rally organized by pro-vaping groups in London in November. One placard that read, “Back Vaping, Protect the NHS” implied that smokers are a drain on National Health Service (NHS) resources in a country where taxpayer-funded medical treatment is free at the point of use. In fact, the estimated cost of treating smoking-related diseases on the NHS is £2.7 billion ($5.57 billion) a year. The annual revenue from tobacco taxation is currently around £9 billion, so in financial terms, smokers are neither a burden on the health service nor the taxpayer.

    So why are these and other groups promoting the type of messages we would normally expect from anti-smoking activists? Perhaps they hope to win recognition or support from politicians and the public health industry. If so, they are likely to be disappointed because evidence suggests that the tobacco control industry, including politicians and campaigners, are only interested in vaping as a short-term “solution” to the “problem” of smoking. Few, if any, consider vaping to be a long-term alternative to smoking and certainly not a pleasurable habit in its own right. In their view, e-cigarettes and other reduced-risk products are smoking cessation aids and a stepping stone to giving up nicotine completely.

    Which brings me to the public health endgame. Is it smoke-free or nicotine-free? What is the long-term outlook for all nicotine consumers, even in more liberal markets, if governments achieve their initial target of a smoke-free world? It’s clear to me, and others, that even in countries like the U.K. that currently have a relatively relaxed attitude to e-cigarettes, the endgame for public health campaigners is the eradication of all forms of recreational nicotine.

    Some tobacco harm reduction advocates seem to think that eradicating combustible tobacco will ultimately benefit all smokers because their physical health will improve, but what about those like British artist David Hockney, 84, who says he smokes for his mental health? Is he, and millions like him, not entitled to make that choice for himself? “I couldn’t imagine not smoking,” says Hockney, “and when people tell me to stop, I always point this out. I’ve done it for 68 years, so are you telling me I’m doing something wrong?”

    Meanwhile, by failing to challenge the stop smoking brigade, tobacco harm reduction campaigners are actually advancing the inevitable attempt to force consumers to give up all forms of nicotine. Indeed, the idea that vaping will not be a future target for every public health campaigner, even those who are currently well disposed to vaping as a smoking cessation tool, is naive if not laughable.

    Millions of adults enjoy smoking and don’t want to quit. The war on smoking is therefore a war on choice and pleasure, and users of all recreational nicotine products should be fighting as one united army. Instead, by failing to support smokers who don’t want to stop, many tobacco harm reduction advocates are foolishly, for short-term gain, weakening the efforts of those who truly believe in freedom of choice and personal responsibility. And if we lose that battle, I guarantee we will lose the war on nicotine too.

  • New Hurdles Ahead

    New Hurdles Ahead

    Photo: Attasit

    Growers discuss the challenges and opportunities facing their sector during ITGA’s annual Issues Day.

    By Stefanie Rossel

    Increasing regulatory pressure, sustainability, climate change and child labor emerged as the main challenges during the International Tobacco Growers’ Association’s (ITGA) Issues Day on Nov. 18. Due to the ongoing Covid-19 pandemic, the conference for took place virtually for the second year in a row.

    The ITGA’s president, Abiel M. Kalima Banda, described 2021 as another year of limitations. Interestingly, though, the Covid-19 crisis wasn’t as bad for the tobacco industry as it was for other businesses, as ITGA’s CEO Antonio Abrunhosa pointed out. Especially in the main leaf countries, production went back up again, with markets returning to normal.

    However, new regulations are presenting new challenges to farmers. For example, just one day before the ITGA meeting, the European Union executive outlined a draft law requiring companies to prove that agricultural commodities destined for the bloc’s 450 million consumers were not linked to deforestation. “The future of regulation will be tougher than it is now,” said Abrunhosa. “Growers will suffer the greatest part of sustainability issues. Buyers must be aware that farmers need a decent income to be sustainable and support their families.”

    While burley witnessed another year of decline, flue-cured Virginia (FCV) volumes in Brazil, Zimbabwe, the U.S. and China experienced a boost, according to ITGA tobacco expert Ivan Genov, referring to data provided by Universal Leaf. An even higher growth rate is expected for 2022, but it is likely to remain below the range that was the norm before the pandemic. Growers are faced with steadily increasing production costs, Genov said. “The situation remains volatile; the pressure on the sector remains strong. Sustainability issues will increase and intensify further.”

    Slight Recovery

    Ivan Genov

    World tobacco leaf production stood at an estimated 4.74 billion kg in 2021, with FCV production amounting to 3.47 billion kg, slightly up from 3.37 billion kg in 2020. By 2022, production is anticipated to reach 3.5 billion kg. Dark air-cured production remained stable at 111 million kg in 2021, whereas oriental declined from 155 million kg in 2020 to 128 million kg in 2021. Burley production declined to 411 million kg in 2021 from 446 million kg a year earlier. The latter crop is expected to recover next season, with production going back up to 468 million kg in 2022, which would still be below pre-Covid-19 levels.

    Seven of the world’s top 10 tobacco exporters by volume saw declines in 2020. Brazil’s exports dropped from 530 million kg in 2019 to 485 million kg in 2020; China’s exports declined from 194 million kg in 2019 to 186 million kg in 2020; and India’s exports decreased from 186 million kg in 2019 to 177 million kg in 2020. Only Argentina and Turkey registered a minor increase in production for export, according to U.N. Comtrade figures.

    In terms of value, Brazil finished first with $1.51 billion worth of tobacco exports in 2020, followed by Zimbabwe ($741 million) and the United States ($695 million). According to Universal Leaf, China will provide around 50 percent of global FCV production in 2021, followed by North, Central and South America with a combined 24 percent share. Africa and the Middle East, currently standing at 10 percent, are expected to increase production volumes in 2022.

    Growers in the U.S. and Zimbabwe suffered challenging working conditions in 2020. The U.S. fought a trade war with China, whereas Zimbabwe was hit hard by Covid-19, which delayed auctions. On Nov. 8, the country’s ministry of lands and agriculture announced plans to generate more value from its tobacco sector. It aims to create a $5 billion tobacco industry by 2025.

    Cigarette Value Under Pressure

    Shane Macguill

    Shane MacGuill, Euromonitor global lead for nicotine and cannabis, looked at the current key drivers in the global tobacco market. The Covid-19 disruption, he observed, has created both threats and opportunities. The pandemic will potentially have implications in the medium term regarding consumer choice and disposable income. Significant prevalence and visibility declines, caused by tobacco control, he noted, will probably be the long-term key driver. MacGuill expects this to ease a little in the future, though. Heated-tobacco products (HTPs) and nicotine pouches have broadened the nicotine universe and caused a fragmentation. “As a consequence, cigarette value will diminish over time,” he said. Regulatory innovation has been key in the tobacco space historically and is expected to continue, potentially even further. MacGuill singled out the “beyond nicotine” sector as another key driver.

    In 2020, global cigarette volumes just held up, whereas value came under pressure, according to MacGuill. Excluding China, consumption stood at 2.79 trillion cigarettes. Illicit product accounted for 12 percent of cigarette sales.

    The value of cigarette sales declined by 0.2 percent in 2019–2020, while stick equivalent value rose 1.4 percent. The overall value of the global cigarette market was $484 billion, and the global average pack price was $2.77, or $3.47 excluding China. Cigarettes represented an 84 percent share of total value sales (81 percent excluding China).

    Between 2015 and 2020, total cigarette demand grew most in Ethiopia, Jordan, Egypt, Hong Kong, Cambodia, Brazil, Vietnam, Algeria, Lebanon and El Salvador—primarily developing countries that saw migration from other tobacco categories into the cigarette category and perhaps lower regulation and excise. Demand fell most in Japan, Sri Lanka, South Africa, Ukraine, Peru, the Philippines, Australia, Saudi Arabia, Lithuania and Greece. Here, the decline was pushed by a combination of strong regulatory measures, increased taxation and the rise of cigarette alternatives. HTPs were driving substantial cigarette volume loss, most notably in Japan.

    Of the top 15 stick markets, Egypt, Vietnam, Bangladesh and India are expected to grow in stick/stick equivalent volume.

    HTPs Heating Up

    Global illicit cigarette trade dropped during 2020 as border closures and lockdowns interfered with illicit supply chains. However, MacGuill expects a return in growth, with illicit trade standing at around 15 percent eventually. Eastern Europe and Asia-Pacific will be among the most affected regions over the next five years as a result of affordability.

    “HTPs will cement their place at the head of the vapor growth narrative,” MacGuill predicted. “With the leading growth markets between 2020 and 2025 including Russia, Germany, Poland, the U.S., Japan, Italy, Ukraine and South Korea. To consumers, availability, ease of use, the possible impact on health but also price are among the most important product features. In a consumer survey, lack of information on the products was named as the essential barrier for not using HTPs.”

    Nicotine pouches reached a value of $1.2 billion in 2020. With benefits from lower barriers to consumers’ communication and—for the time being—less regulatory pressure, the segment is expected to grow by 40 percent to 2025.

    During 2020, overall monthly nicotine use grew in 17 markets, possibly due to pandemic-related factors, such as boredom and stress, according to Euromonitor. While cigarette use mostly declined or stayed flat and e-cigarette use plateaued in some key markets, HTPs saw a significant uptake. Across formats, price remained the key product feature.

    Many tobacco manufacturers see their future in “beyond nicotine” products, especially in the field of cannabis. According to MacGuill, investors are now assigning greater value to nicotine companies that are more diversified away from combustible products. Companies are also likely to focus more on cannabis as a potential substitute for their tobacco and nicotine products. Sales are set to reach $92 billion by 2026. Key trends in the cannabis space include a wider range of ingredients and formulations, targeting new populations, such as gamers, and new occasions, such as cannabis products in tins for dogwalkers.

    More Regulation Looming

    Michiel Reerink

    Michiel Reerink, corporate affairs director and managing director at Alliance One International, listed the outcomes of the ninth session of the Conference of the Parties (COP9) to the World Health Organization’s (WHO) Framework Convention on Tobacco Control (FCTC), which took place Nov. 8–13, 2021. Among other things, COP9 delegates agreed on the creation of an investment fund to support control activities and noted and deferred to WHO reports on technical matters including HTPs as well as on research and evidence on novel and emerging products without discussion or decision until COP10 in 2023.

    In the EU, the Supply Chain Due Diligence Act will increase the industry’s regulatory burden. In March 2021, the European Parliament adopted a resolution on corporate accountability, which stipulates a due diligence requirement for human rights and environmental standards that is likely to be aligned with OECD and United Nations Guiding Principles. By now, 15 EU member states have adopted human rights at the supply chain level. “Suppliers should prepare for this legislation,” Reerink said. “Due diligence should already be part of their company code of conduct.”

    Finding Alternative Livelihoods

    Heliodoro Campos, manager of the National Tobacco Fund in Colombia (Fedetabaco), described the plight of small-scale tobacco farmers in his home country. The sudden exits of Philip Morris International and British American Tobacco in 2019 and 2020, respectively, left thousands of tobacco famer families struggling for alternative sources of income (see “Blueprint for Exit,” Tobacco Reporter, March 2021). A conversion plan that envisaged the cultivation of permanent crops, such as Tahiti lemon, for the 30 percent of families that are landowners and transitory crops, such as maize or yuca, for the remaining 70 percent of families who lease their land did not materialize, as Colombia didn’t provide the required financing.

    Campos’ presentation was a cry for help. Stakeholders are now hoping that a new conversion plan that foresees the production of non-THC cannabis will yield better results. A pilot project is expected to provide insights into the cost of production and potential profitability next year. Campos said he was trying to find resources for this plan, also internationally.

    Stepping up the Fight

    Innocent Mugwagwa, senior manager of the Eliminating Child Labor in Tobacco Growing Foundation (ECLT), outlined the development of his organization, which has moved from focusing on implementing small projects in Africa in the first decade of the millennium to signing pledges of commitment with companies and addressing minimum requirements for businesses and human rights in the 2010s.

    In 2021, the foundation started concentrating on technical assistance, supporting governments so that they can protect children’s rights and supporting businesses to prevent and remedy child labor. It will also cooperate more closely with the ITGA to strengthen famers’ voices in defining fair standards and educate farmers in languages they understand. “We already worked together with the ITGA in the education of farmers on Covid[-19],” Mugwagwa explained. Furthermore, the ECLT will leverage governments and businesses to support ITGA members’ and farmers’ efforts in combatting child labor.

    The ITGA’s vice president, Jose Aranda, closed the conference by emphasizing that a unified voice and strengthened efforts were needed to fight the challenges. “We must understand that the new challenges to our sector are threatening, with increasing regulations and the growing popularity of products without tobacco. Some markets are already gone.”

    Antonio Abrunhosa

    Vázquez succeeds Abrunhosa as ITGA CEO

    The International Tobacco Growers Association appointed Mercedes Vázquez as its new CEO during the organization’s 36th annual general meeting, which took place virtually Nov. 18-19. Vázquez succeeds António Abrunhosa, who announced his retirement after serving in the position since 1998.

    Members expressed their gratitude and highlighted Abrunhosa’s role in positioning ITGA as a key player in the global tobacco sector.

    “In my new role I will do my best to continue this learning process from all of you so I can ensure and reinforce the long-lasting relations with our partners so we can together overcome the common challenges we are facing in our sector,” said Vázquez.

  • Making its Mark

    Making its Mark

    Photo: Poda Holdings

    By addressing the shortcomings of existing products, Poda Holdings is pushing heat-not-burn technology to new levels.

    By Marissa Dean

    Sales of heat-not-burn (HnB) products have increased dramatically in recent years. In Japan—the world’s largest market for these products—HnB has helped drive down traditional cigarette consumption to unprecedented lows. Due to the absence of combustion, HnB devices release significantly lower levels of harmful toxicants than traditional cigarettes, allowing smokers to move down the risk continuum while continuing to derive the satisfaction they seek from nicotine.

    Globally, the HnB market is dominated by large companies, such as Philip Morris International, BAT and Japan Tobacco International, along with regional players, such as KT&G. But smaller companies, too, are eager to make their mark. By addressing what they perceive to be the shortcomings of existing devices, they are slowly but surely claiming their share of this promising category.

    Poda Holdings is one such company. The firm was founded in January 2015 with the goal of creating the best HnB product ever made, according to CEO Ryan Selby. “Many adult smokers have been seeking smoke-free products that have the potential to reduce the risks associated with their smoking habit,” he said. “By focusing on their wants and needs, we were able to identify some key components missing from the heat-not-burn industry.”

    The company offers an HnB tobacco-free product called Beyond Burn. “Our flagship Beyond Burn Poda Pods contain a unique tobacco-free blend of pelletized tea leaves infused with synthetic nicotine, which have been expertly crafted to mimic the sensorial experience of traditional cigarettes without the smoke, without the smell and without the tobacco,” the company explains on its website. The tea leaves (versus tobacco or other substances) provide a stable, consistent and low-cost substrate that is truly tobacco-free for use in the device, according to Poda.

    “The closed-ended design allows an incredibly wide variety of substances to be used in our system—something that open-ended systems simply cannot do.”

    A New, Clean Technology

    Poda’s current technology, which took six years to develop, consists of the Beyond Burn Poda Pods and the Beyond Burn heating device. The device features a single button with three temperature settings. It has a fast-charging battery that is capable of heating a full pack of pods on a single charge, and the company plans on launching additional devices across different price points in the future to allow consumers more choices.

    “When we looked at the HnB space, it was clear that innovations were happening all around,” said Selby. “We knew that making a product that replicated the sensorial experience of smoking was only half the battle. Being well-versed in the space, we knew that odor and residue buildup in heating devices was a major user pain-point and one that no one had yet solved. In our research, this was one of the primary challenges users faced—a heating device that started out with excellent performance, only to degrade with use, gathering strong odors and requiring extensive cleaning to keep the device operational. This contamination also left flavor residue in the heating devices, limiting the options for switching different flavors and different types of substances. It was our goal to solve that problem as a primary focus, finding a way to keep all the mess contained within each disposable pod.”

    The Beyond Burn Poda Pods are considered “zero-cleaning,” meaning that their pod design keeps any potential mess contained within the pod itself, taking away the need for cleaning or maintenance. This also means there is no residual odor in the heating device and no cross-contamination between pods when they are switched. “What sets us apart really boils down to our patented closed-ended pods,” said Selby. “The closed-ended design … allows an incredibly wide variety of substances to be used in our system—something that open-ended systems simply cannot do. Ground plant matter, pellets, sheets, liquids, etc., are all possible in our pods, where our open-ended competitors would have to come up with solutions for each of these material forms individually.”

    “Big Tobacco was coming at the challenges in the space with answers that fit their existing manufacturing methods and techniques, and thus they weren’t thinking very far outside the box,” Selby said. “Poda came at the problem from a totally different angle.”

    Pods are currently packaged in the company’s facility in China and are packaged in cartons of 200 pods, with each carton containing 10 packs of 20 pods. The current manufacturing capability is over 400,000 pods per month, but the company is currently scaling up production and plans to produce over 10 million pods per month by the end of 2021. “We’ve raised enough capital to scale up our production capabilities to meet initial launch demand, and we have a comfortable runway to execute our launch plans,” said Selby.

    Poda Holdings’ Beyond Burn Poda Pods contain a unique tobacco-free blend of pelletized tea leaves infused with synthetic nicotine, which mimic the sensorial experience of traditional cigarettes without the smoke, without the smell and without the tobacco.

    Regulation

    The absence of tobacco in Poda’s products offers opportunities that are unavailable to tobacco-containing offerings. “The tobacco space is heavily regulated throughout the world, and new reduced-risk and heat-not-burn products face many of the same regulations as cigarettes as well as additional regulations pertaining to products in the vaporization space,” said Selby. “This overlap creates a complex regulatory landscape that is constantly evolving—each country having their own unique framework. Our first offering—our flagship Beyond Burn Poda Pods—contain no tobacco products whatsoever, so they tend to be outside the scope of existing tobacco regulations. As the landscape changes, our closed-ended pods will allow for exploring a multitude of different substance options for tobacco and beyond—allowing Poda to navigate regulatory hurdles in a way many of our competitors aren’t able to.”

    While Poda Pods do not currently contain tobacco, the company has opted to file a premarket tobacco product application (PMTA) in the U.S. The PMTA pathway is a long process, with only a handful of applications approved to date, but it is necessary to market deemed tobacco products in the U.S. According to the Food and Drug Administration, deemed tobacco products consist of “electronic nicotine-delivery systems, which include e-cigarettes, e-cigars, e-hookah, vape pens, personal vaporizers and electronic pipes; pipe tobacco; dissolvables; nicotine gels; waterpipe (hookah); cigars; and future tobacco products.”

    “We believe that our Beyond Burn Poda Pods are not subject to the PMTA as they contain lab-synthesized synthetic nicotine, no tobacco ingredients whatsoever and, importantly, cannot be used with any other tobacco products,” said Selby. “However, there are a multitude of potential future opportunities for Poda products to be used with tobacco, and so in order to demonstrate our commitment to total compliance with the PMTA, we have begun the PMTA process in the USA for Poda products containing tobacco and tobacco-derived products.”

    Poda products contain synthetic nicotine, which is essentially chemically identical to tobacco-derived nicotine but currently outside of the FDA’s remit. Poda chose to use synthetic nicotine because it allows for more control over what goes into the pods. “Synthetic nicotine offers the same satisfaction as tobacco-derived nicotine without the chance of impurities and harmful substances from the tobacco plant contaminating it during the extraction process,” said Selby.

    Beyond Burn Poda Pods are currently available in three different flavors with more expected down the line. The company is planning for other content offerings as well, including coffee/caffeine infused products, nicotine-free blends, real tobacco, cannabis/CBD and medicinal herbs. “We envision a family of devices, all designed to work with our pods, regardless of pod contents.”

    Thinking Outside the Industry

    To better reflect its broad, multisector ambitions, Poda recently announced a new planned corporate structure featuring six subsidiaries—Poda (Tobacco), Poda (Alternatives), Poda (Therapeutics), Poda (THC), Poda (CBD) and Poda (Research and Development). Poda has also filed intellectual property patents (already granted in Canada) for its proprietary technology, brought on new board members and created new positions. Former Juul Canada president, Michael Nederhoff, joined the global advisory board and is consultant to Poda’s management team and the company’s board, assisting with the company’s global expansion. Nicholas Kadysh, former Juul head of corporate affairs, recently joined Poda’s global advisory board as well.

    Poda is also thinking beyond consumer goods, entering the medical device market and appointing the company’s first chief medical officer, Jagdeep Gupta. “I am very pleased to have received approval from the board to enter the medical device market and to create the position of chief medical officer for Poda,” wrote Selby in a press release. “In addition to providing exceptional reduced-risk products designed for current adult smokers, Poda is also committed to providing effective smoking cessation products designed to help adult smokers quit smoking.”

    “Quitting smoking can be difficult, and the addition of Dr. Gupta as chief medical officer will help Poda to develop medically approved products and treatment strategies designed to provide adult smokers with the tools they need to successfully quit smoking. In addition, there are numerous opportunities for Poda to utilize our intellectual property and related technologies to potentially facilitate the delivery of many different therapeutic molecules by inhalation.”

    Gupta later announced that he began clinical trials for Poda’s smoking cessation products. “I have already initiated the process of setting up the first clinical trials related to the efficacy of Poda’s products as smoking cessation tools,” Gupta wrote in a release. “I am currently in the process of setting up a pilot study, which will give us a solid platform for developing strong and effective clinical trials. These clinical trials will be designed to result in the publication of Level 1 evidence in respected medical journals globally if the data provides evidence. The pilot studies will also be designed to establish a scientific basis for the efficacy of Poda’s products as smoking cessation tools and additionally may provide Poda with access to research grants and other funds that can be used for additional studies, clinical trials and validation research.”

    In addition to expanding into the medical device industry, Poda signed a supply agreement with Greenbutts, a biodegradable filter manufacturer. “This supply agreement will provide the company with access to 100 percent biodegradable filters for use in our Beyond Burn Poda Pods,” according to Selby. “The inclusion of Greenbutts’ biodegradable filters into our already biodegradable and compostable Poda Pods allows Poda the ability to offer a completely biodegradable and truly compostable heat-not-burn product, something that has never been done in the heat-not-burn tobacco market.”

    Gamechanger

    Poda has accomplished a lot in the past six years and is now poised to be a potential gamechanger in the heat-not-burn market. A mess-free, zero-cleaning biodegradable product that could reach beyond tobacco and nicotine products seems like it would be a very attractive product for consumers—and it would seem others agree; Poda recently received an order for 500,000 Beyond Burn Poda Pods and 2,000 Beyond Burn Heating Devices, expected to be used during the initial launch in the European market later this year.

    Time will tell how this technology impacts the market. Selby, for his part, is confident Poda could change the face of HnB. “I believe that Poda really is the solution the HnB space has been waiting for,” he said.

     

  • The Need for Nuance

    The Need for Nuance

    Photo: Andrey Popov

    It’s time for regulators to stop lumping all tobacco products together as being equally risky.

    By George Gay

    “It’s still difficult for me to understand how the European Commission can claim on the one hand that they want to do everything in their power to fight cancer, including revising tobacco policy, yet on the other hand completely reject the idea of liberalizing regulations for one of the very few products that has shown it can displace cigarettes.”

    The above is a quote attributed to the Swedish member of the European Parliament, Sara Skyttedal, as part of a Snusforumet story published on Nov. 19. Skyttedal is clearly frustrated and angry with the commission, and, according to my interpretation of the story, her frustration comes down in part to the fact that while the commission says it wants to reduce the incidence of smoking throughout the EU to the low level at which it stands in Sweden, it is not willing to remove the ban on snus, the product that has largely displaced cigarettes in Sweden but that, for inexplicable reasons, is banned in the EU with the exception of Sweden.

    I feel certain Skyttedal is merely making a point: She doesn’t really believe there is a logical conflict in the commission’s position. The apparent conflict is easily resolved by pointing out that while the commission might say it wants to do everything in its power to fight cancer, that is not the case. In fact, this becomes clear later in the story when, talking about the connection between Sweden’s low level of tobacco-related cancers relative to those in the rest of the EU and the fact that Sweden is the only country in the EU where snus is legally available, Skyttedal says the commission sees the connection but is not willing to act on it.

    I hate to state the obvious, but I would guess that one of the commission’s hang-ups has to do with tobacco. It can tolerate the idea that nicotine in the form of nicotine-replacement therapy products or even vaping products should be allowed to replace tobacco products, but it cannot bear the idea that tobacco products might be allowed to substitute tobacco products. Tobacco has pariah status; nicotine is somewhere lower on the continuum of the unacceptable.

    Let me provide an example. In November, my newspaper ran a story about how, because of the goods transport chaos afflicting the U.K. post-Brexit, there might be a shortage of alcohol this Christmas. This was seen as a negative because, apparently, we cannot celebrate this Christian festival without being off our heads, and despite the fact that such a shortage would probably result in fewer family fights, stomach-pumping hospital visits, drunk driving and all that entails, assaults on hospital accident and emergency staff and even deaths, since alcohol kills.

    Imagine, however, if the story had been about a shortage of tobacco at Christmas. This would have been presented as a positive, though it would have caused a number of negative outcomes and almost no positive results, with the exception that a few people might have discovered they were able to quit their habit.

    Language Matters

    But I digress. Let me return to Skyttedal’s original complaint about the commission’s failure to follow through on its aim to do everything in its power. There are certain categories of phrases that immediately flash warning signs to the effect that what is being said should be taken with a pinch of salt, and one such category comprises those with superlatives. Just think of the phrases “nobody wants to see …” and “everyone agrees that ….” You hear and see such phrases used all the time, but it doesn’t take more than a second’s thought to realize they cannot be correct. It is almost impossible to imagine an instance when nobody or everybody was in favor of something. So when somebody tells you they are doing “everything in their power” to bring about a certain result, you know it’s time to look somewhere else for help.

    Language matters, and, to my way of thinking, one of the problems that people who champion tobacco harm reduction have helped to create is down to the fact that they have been too willing to accept and parrot some of the extreme language and figures used by those people also involved in tobacco control but who are opposed to harm reduction. For instance, there has been a willingness to go along with claims of nicotine addictiveness that are clearly unsupportable, even though some health professionals keep this pot simmering by telling smokers they cannot give up nicotine without the support of … yup, there’s a surprise, health professionals.

    Probably the ultimate superlative is “smoking kills,” which has become so ingrained that you are mocked if you say you don’t agree with it, but the truth of the matter is that a certain percentage of smokers die of smoking-related diseases, mostly after a long and possibly enjoyable history of smoking. The other smokers die of something else—perhaps of injuries caused by a drunk driver. And, I hate to be downbeat, nonsmokers die too, perhaps of “tobacco-related diseases,” though ones caused by pollution. If they didn’t die, the world would become full up, and the gene pool would lose its vigor.

    OK, some will argue the smoking problem is not only about death but about the physical and economic costs of smokers living with medical conditions linked to their habit. But we are all prisoners of the choices we make. I doubt there are many people who reach the age of 50 without carrying some physical ailment linked to something they did when they were young. Some footballers die at relatively young ages having suffered from dementia attributable to their playing football, but few would claim playing football kills. Rather, we try to change the rules of the game and the equipment used to prevent brain damage—we employ harm reduction techniques.

    Perhaps it’s time to reconsider what we mean by “smokeless.” After all, some tobaccos are cured using artificial heat—in some cases by burning wood fuel and contributing to deforestation. (Photo: phanasitti)

    Distortion is a Problem

    On the question of parroting figures, take the annual death toll attributed to tobacco-related diseases. Over the years, it has been increased a number of times, usually in lots of one million, so it now stands at the nicely rounded figure of 8 million. At the same time, the World Health Organization, which has ownership of this figure, has been claiming success in its efforts to prevent the deaths attributed to tobacco. But even given the world’s population has been increasing, it cannot be the case that the figure for tobacco-related deaths keeps leapfrogging this supposed success.

    Why is this important? Because by exaggerating the problems caused by tobacco, some sections of tobacco control have been allowed to distort the picture to such an extent that it becomes difficult to sell the idea of tobacco harm reduction. When tobacco is depicted as being “deadly”—a superlative you often see applied to this product—and that depiction is not challenged, it becomes too counterintuitive even for the uncommitted to imagine that the problem caused by tobacco can be significantly reduced by another tobacco product such as snus. Additionally, because too many people have, for a quiet life, gone along with the U.S. Food and Drug Administration’s airy-fairy idea that e-cigarettes can be “deemed” “tobacco” products, the use of even vaping products as tobacco harm reduction agents can be challenged easily by those who wish to do so.

    What we need is honesty. For instance, we need to stop lumping all combustibles together as if the consumption of cigarettes, cigars or pipe tobacco is equally risky. This cannot be the case, especially at a population level. And we have to do the same in respect of smokeless products. For instance, what do we mean by “smokeless”? Are we talking only of the consumption of the final product? Perhaps it’s time we checked out whether some of the tobaccos used in some “smokeless” products are cured using artificial heat—in some cases by burning wood fuel and contributing to deforestation.

    It has become fashionable to talk of both individual and population risk, so, in this context, is it OK to reduce the harm caused to individuals by tobacco consumption if the production of the less risky items involves damaging the environment and, by extension, threatening the health of tobacco and nontobacco users alike?

    This is a massively complex question, the answer to which would mean a descent into not altogether helpful relativities. One thing seems clear to me, however. If you drew up a continuum of environmental risk caused by tobacco and nicotine products, you would wind up with a picture somewhat different to the continuum of individual consumer risk caused by tobacco and nicotine products, which we are more used to seeing. But one thing would remain pretty much the same. Smokeless products, such as nicotine pouches, snus and chewing tobacco, would be the stand-out products when it comes to reduced environmental risks. What would change, I think, is that the divisions between combustibles in respect of environmental risks would widen appreciably, and vaping products, which are smokeless, while scoring well on the individual consumer risk continuum might well end up in free fall on the environmental risk continuum, something that needs to be addressed.

    I’ve seen it said that there should be one set of rules for combustible products and another set of rules for noncombustible products. I think the rules need to be more nuanced than that.

  • Who D’Ya Think You Are?

    Who D’Ya Think You Are?

    Photo: EwaStudio

    Your business from the regulators’ perspectives

    Willie McKinney and Cheryl K. Olson

    Let’s do a thought experiment. Imagine—some of this may sound familiar—that you’re one of two brilliant young graduate students attending a university in the middle of Silicon Valley. You come up with a jewel of an idea for a product that could help cigarette smokers reduce their mortality and morbidity by delivering nicotine with far fewer health-destroying byproducts of combustion than traditional cigarettes.

    The business environment around you is laced with artificial intelligence, self-driving cars and apps that brashly take on entire industries. The ethos of your fellow entrepreneurs is to challenge everything, smash things when they get in your way and loudly proclaim that you’re changing the world for the better. You can always correct your mistakes later.

    What business are you in? To your eyes, you’re in the smoking cessation business. That is, after all, your stated goal and the purpose of the device you’ve designed. It’s a noble cause that could save millions of lives while making your investors and you a fortune. You’ve hit that ideal of doing good while doing well. What could possibly go wrong?

    A lot, it turns out. Predicting those potential disasters requires that you know whether you perceive the fundamentals of your business the way that others—especially government regulators—perceive it. In our not-really-hypothetical example, the protagonists saw themselves as fighting Big Tobacco. They approached marketing their product as if it were a kind of ride share or housing share offering, industries in which regulations are both few and local. They were making consumer goods, so they mostly hired executives from packaged goods industries little acquainted with addictive ingredients or tobacco industry history. 

    The U.S. Food and Drug Administration viewed your imagined company through a different lens. To the government (and soon the press and the general public), you were simply an extension of Big Tobacco. Your Silicon Valley brashness backfired, triggering memories of industry lies about the addictiveness of nicotine and cynical attempts at youth smoking prevention by tobacco companies. A hero’s journey became a cautionary tale.

    Can this still happen today? Can the lens through which you view your company be dramatically different from the perspective taken by government regulators? Unfortunately, we see it all the time.

    A Tale of Two Companies

    Josh Israel started Hale Therapeutics with a co-founder who lost a family member to smoking combustible cigarettes. His device is programmed to deliver and taper off heated, aerosolized nicotine as a way of ending the addiction.

    “It minimizes the discomfort of nicotine withdrawal while you learn to live a smoke-free life,” said Israel.

    Hale approached the FDA’s Center for Drug Evaluation and Research (CDER) to open discussions toward approval of what Israel viewed as an innovative pharmaceutical delivery system for a much-studied drug. That may sound like a strange approach to take. Why not pursue a marketing authorization from the FDA’s Center for Tobacco Products (CTP)? That would be faster and likely to succeed. CTP had already authorized VUSE, calling that ENDS device’s aerosol “significantly less toxic than combusted cigarettes.”

    “We’re not a tobacco product. So we don’t want to be licensed as a tobacco product, and we don’t want to be looked at as a tobacco product,” Israel continued. “It’s a smoking cessation product. Why would we be classified as anything else?”

    The FDA saw things differently. New CDER guidance on testing “inhaled nicotine-containing drug products” focuses on the word “heated,” and the “novel chemicals” that heat might generate. CDER may have viewed Hale’s device as akin to an e-cigarette because it heats. This difference in perceptions led CDER to point Hale toward spending a substantial chunk of time and money on animal studies that would not have been required had Hale gone down the CTP path for permission to market the same device. (And run counter to FDA pledges and initiatives to reduce use of animals in research.)

    Meanwhile, Brian Quigley, the COO of Respira Technologies, was preparing to meet with CDER about his product, a nebulizer for use as a nicotine-replacement therapy. It creates and controls an unheated nicotine aerosol.

    “It’s kind of shocking to think that in 2021, the number one way that smokers try to quit is cold turkey,” said Quigley.

    Unlike Hale’s experience, CDER apparently viewed Respira’s product much as the company did. The fact that the nicotine was unheated worked to Respira’s advantage. CDER was more comfortable allowing the data to guide what preclinical studies Respira’s product will need. Quigley expects to submit an Investigational New Drug application to CDER in 2022.

    Hale Therapeutics, however, faced a potentially costly choice. It could fight CDER. It could devote time and capital to research that it contends is unnecessary. It could switch paths, reluctantly accept the perception that it was making a tobacco product, and apply to CTP. After much deliberation, Josh Israel decided to … do something different. Hale would keep talking with the FDA about reducing the testing burden but would take action to forward its mission elsewhere.

    Hale went to the U.K. and applied for a license from its Medicines and Healthcare products Regulatory Agency (MHRA) as a smoking cessation device.

    “The goal for any public health agency should be to get people off combustible cigarettes, full stop,” said Israel. “We were embraced by the MHRA. And it’s unfortunate that the FDA is not taking the same approach.”

    What is that approach? The MHRA is developing a licensing process by which e-cigarettes could be prescribed by the National Health Service in England as a medical product for smokers who wish to quit smoking. It would be the first country in the world to do so.

    There are about 6.1 million smokers in England, with rates of smoking roughly inversely correlated with socioeconomic status. That means that smokers generally are at greater risk for a variety of other health and social problems, making smoking cessation especially impactful. For several years, e-cigarettes have been promoted by the governmental to combustible cigarette smokers as an effective way of both reducing immediate harm and putting those smokers on a path to quitting nicotine completely.

    “The MHRA evaluation program for e-cigarettes is focused on nicotine delivery—not cessation per se—as a measure of efficacy, and with as few harmful and potentially harmful constituents as possible,” said Ian Fearon, a U.K.-based clinical research scientist who consults on nicotine and tobacco product studies. “It appears easier to obtain a medical license with MHRA than a market authorization from the Center for Tobacco Products, given the volumes of data required to support a PMTA.”

    A Difference in Politics and Philosophies

    One reason why there may be such a difference is that regulators reflect and illuminate the values and experiences of the countries they regulate. When CDER issued its guidance for inhaled nicotine-containing drugs in October 2020, the public perception of vaping in the U.S. had hit new lows.

    San Francisco had recently banned the sale of all e-cigarettes within the city limits, ironically using a supposedly pro-health agenda to push an unknown number of former smokers who were using vaping to quit back to using combustible cigarettes. E-cigarette or vaping use-associated lung injury, which had been falsely associated with commercial vaping products, was still in the headlines.

    Not surprisingly, the CDER guidance focuses on what could go wrong. It recommends hunting for potentially toxic “novel chemicals” through years of rodent inhalation studies before testing heated nicotine products in humans.

    The U.K. has never experienced an American-style moral panic over e-cigarettes and youth. This takes a political thumb off the scale in their pragmatic weighing of the science.

    It’s also not surprising that the two FDA centers that regulate nicotine products can be fractious. CDER has been part of the FDA since the 1980s. Its pathways to approval are well entrenched and clearly marked. Its mission is “making sure that safe and effective drugs are available to improve the health of the people of the United States.”

    By contrast, the FDA’s Center for Tobacco Products is a newbie, born from the Tobacco Control Act of 2009. It’s about balancing health risks among different segments of the public. CTP plays by different rules, proclaiming on its website that the “FDA’s traditional ‘safe and effective’ standard for evaluating medical products does not apply to tobacco.” It doesn’t approve products; it permits them to be marketed. Because of its youth, CTP procedures are still forming and solidifying. 

    So, let’s go back to our mind experiment for a moment. Now how do you view the business your company is in?

  • Rules Of The Road

    Rules Of The Road

    Photo: DW labs Incorporated

    What manufacturers should know about the medical route for vapor products to the U.K. market.

    By Lloyd Smart

    E-cigarettes, and the regulations surrounding them as medicinal products, were thrust into the national spotlight in the U.K. with the news that the National Health Service (NHS) could look to prescribe them to smokers in the future.

    The U.K. has set a target to be smoke-free by 2030, and supporting smokers in switching to less harmful methods of nicotine delivery has largely been met with a positive reaction. 

    Yet, the opportunity to register nicotine-containing products as medicines in the U.K. has always been in existence.

    Broughton was involved in the first electronic cigarette to be licensed in the U.K. as a medical product in 2015, the Voke. The e-cigarette, which underwent testing at our facility, was a milestone in the electronic nicotine-delivery systems (ENDS) world but was never launched.

    The recent press release by the Medicines and Healthcare products Regulatory Agency (MHRA) underlines the medicinal route for manufacturers and sets out the guidance on offer for those who want to take it. The expanded guidance is a positive step to encouraging larger take-up that could lead to general practitioners (GPs) prescribing e-cigarettes—and greater numbers of people quitting tobacco completely. Of course, the outcome of a GP appointment lies in the choices made by the GP or nurse practitioner, and it may be that work needs to take place to change perceptions of ENDS products within the NHS.

    It is interesting to note that Brexit has paved the way for the U.K. to somewhat diverge from European legislation, a clear indication that the U.K. is pioneering this approach and moving forward on its own.

    The requirements of the MHRA’s application process are stringent but well understood, with timelines for the approval as a medicine likely longer than a consumer product. Yet there are benefits to be had for those whose products make it through this pathway.

    While it may be a more detailed route, classing a product as a medicine comes with confidence for the end user that it meets defined standards of quality, safety and efficacy, and this layer of trust could make the difference in attracting more smokers to make the switch, which is undoubtedly a positive.

    The medicinal route allows for a much higher strength of nicotine too, not to mention the ability to market products slightly differently.

    The MHRA authorization may also arguably result in a price premium for those products that make it through the process, making it an attractive prospect for manufacturers.

    Certainly, a holistic view of the available regulatory pathways should be discussed upfront, something an integrated consultancy such as Broughton builds into every project, and certainly before data begins to be generated or submissions compiled.

    So, what do manufacturers need to know about the MHRA’s updated guidance?

    Overall, the guidance has been expanded somewhat from about 14 pages to nearly 17, and the MHRA has provided expectations in the key areas of quality, safety and efficacy.

    The overriding message is still that “The MHRA seeks to encourage the licensing of electronic cigarettes (e-cigarettes) and other inhaled NCPs [nicotine-containing products] as medicines and aims to support companies to submit marketing authorization applications for these products.”

    There are other changes for potential applicants to consider:

    • The guidance name has been updated to “Guidance for licensing electronic cigarettes and other inhaled nicotine-containing products as medicines” and now clearly references other inhaled NCPs outside of e-cigarettes.
    • References throughout have been updated to U.K.-specific articles/regulations, for example, UKCA marking is now mentioned, and the U.K. Human Medicines Regulations (2012) replaces EU Directive 2001/83 for the legal basis.
    • The U.S. premarket tobacco product application (PMTA) pathway (via the Food and Drug Administration) is now specifically noted, and the MHRA states, “For applicants with products undergoing the U.S. FDA premarket tobacco product application (PMTA) process, the MHRA can discuss what data may be relevant for a U.K. marketing authorization application.” There is, therefore, potential to share/bridge data from other applications.
    • The new 150-day (national) accelerated procedure for the assessment of high-quality applications is noted. This could potentially shorten the processing time from 210 days down to 150 days, excluding clock-stops, for the marketing authorization application (MAA).
    • Updated references to test equipment and methodology for a “vaping machine” have been replaced with BS ISO 20768:2018.
    • There are clear expectations to provide “analytical chemistry data” to confirm the compounds present in the vapor produced by an e-cigarette device under its normal operating conditions.
    • The nonclinical safety is further expanded to ensure the applicant considers repeat-dose toxicity and how read-across end points, such as PK modeling, adverse outcome pathways and post-marketing surveillance, can all assist in the nonclinical assessment.
    • Guidance on clinical aspects (safety and efficacy) has been strengthened from three quarters of a page to nearly three pages. The underlying principle of the studies has not changed and remains in line with the legal status of the application. However, the MHRA has provided comments on how an applicant may look to design such studies, including the number of participants, sampling points and times, whether the comparison to a combustible cigarette can be excluded, how to address further nicotine concentrations and additional flavors.

    An application and successful product registration as a medicine does come with an increased regulatory expectation on the marketing authorization holder, which applicants will need to consider. Example areas of consideration would include:

    • Applicability of Good Manufacturing Practices
    • Qualified person mandatory role
    • Medical device marking aspects, i.e., UKCA or CE
    • Pharmacovigilance system and qualified person for pharmacovigilance
    • Good Distribution Practices in the supply chain
    • Ongoing stability
    • Life cycle maintenance of the license

    Working with established partners in the pharmaceutical space will ensure that the above list, which is certainly not exhaustive(!), is not an overburdening one.

    The MHRA is making a clear stance as a global regulatory leader in the registration of electronic cigarettes as medicinal products, and that is only to be welcomed.

  • Transformers Versus Abolitionists

    Transformers Versus Abolitionists

    Photo: Grispb

    The two camps in tobacco control

    By Clive Bates

    In November, two major treaties had their Conference of the Parties (COP) meetings. COP26 of the U.N. Framework Convention on Climate Change (UNFCCC) was held in Glasgow, and COP9 of the WHO Framework Convention on Tobacco Control (FCTC) was held online. Both aim to address a globally significant problem, and both aim to achieve radical transformations in the markets for energy and tobacco, respectively.

    Yet, the approach differs significantly. There is tremendous pressure in the climate change treaty to eliminate the combustion of fossil fuels to mitigate environmental risk as rapidly as possible. Climate change activists demand a rapid transition to “net zero,” with energy production moving from coal, oil and gas to renewables such as solar, wind and hydro as soon as possible. Arguments rage about the nature of this transformation and the practicality and fairness of the transition needed to reach it. Should it include nuclear power? Should gas substitute coal? Should tree planting count as negative emissions? The climate treaty is all about harm reduction through market transformation. The debate is about the form of eventual transformation and the pathway to reach it.

    In tobacco and nicotine, we see a different debate. As with climate change, almost everyone agrees there is a problem. Using WHO figures, smoking causes about 8 million premature deaths annually, and many millions more fall severely ill with various forms of cancer, heart disease and respiratory conditions. But in public health, we are sharply divided into two camps—the transformers versus the abolitionists.

    The Transformers

    The transformers see the challenge as bringing down the intolerable burden of disease and death as far and as rapidly as possible by changing the nature of the market for nicotine. They point to the Sustainable Development Goal target (SDG 3.4) to reduce noncommunicable disease mortality by one-third by 2030 compared to 2015, and the inevitable future commitments will follow that. The transformers want the market for tobacco and nicotine to move away from combustible smoked products because the smoke causes most of the harm by far. The transformers are found among pragmatists in public health, the investment community and the companies in the nicotine and tobacco market. The challenge for companies is to transform without hurting their shareholders—they need an account of how the business will evolve. Tobacco control activists often say, “just stop selling cigarettes.” But a listed company can only do this through a credible transformation. Without the support of shareholders, executives would be fired, or the company would face a takeover.

    Two broad strategies are evident for tobacco companies’ transformation. The first strategy is pursuing noncombustible nicotine product market share and growth in a battle of innovation and consumer appeal. The companies are moving into vaping, pouches, smokeless and heated-tobacco products, with competition as a powerful driver of progress. The question that nags at transformers is whether this move is just a niche line extension or the formative stages of a strategic shift. The companies seem to vary, but they are now being tracked by a Tobacco Transformation Index. The second strategy is more subtle and involves diversification of the companies’ activities. This doesn’t mean buying up unrelated firms, such as food or automotive companies, and creating a conglomerate to dilute the tobacco business. Conglomerates are falling out of fashion, with even the once-mighty General Electric announcing the spin out of its healthcare, energy and aviation businesses. For tobacco companies, diversification must involve synergies—meaning the whole must be greater than the sum of the parts. So, for example, we see tobacco companies exploiting their expertise in plant biotechnology, inhalation science and their consumer insights into non-nicotine psychotropics.

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    The Abolitionists

    The abolitionists have a very different endgame in mind. Their implicit and increasingly explicit goal is to eradicate nicotine use and achieve a “nicotine-free society.” Once it is clear that this is the goal, the dogged opposition to transformation becomes straightforward to explain. Reduced-risk products like snus, vapes, pouches or heated-tobacco products are seen as little more than a lifeline for tobacco companies that would otherwise face imminent obliteration. They are not life-saving alternatives to cigarettes but a cynical nicotine maintenance strategy of Big Tobacco.

    There are two problems with the abolitionists.

    The first is that there is no evidence that the demand for nicotine is in decline. With at least a 6,000-year history and currently over a billion users, nicotine use remains a very large-scale and deep-rooted phenomenon. There is even less reason to expect declines in demand for nicotine in the future, and we may see the opposite. The main reason smokers give for quitting smoking is that they are experiencing or anticipating harmful health effects. Remove nearly all the harms associated with smoking, and the main reason for quitting nicotine since 1960 has been mostly eliminated. But this is problematic for the abolitionists: To justify the end of nicotine, nicotine use must be harmful. For abolitionists, the problem with much safer nicotine products is that they destroy the rationale for intervention. That is why there is not much interest in coffee and caffeine control. Unsurprisingly, therefore, we see abolitionists pushing contrived science to show these products really are harmful. They have had some success: The European and American public increasingly believes, incorrectly, that smoke-free products are equally or more dangerous than cigarettes, even though they obviously are not.

    The second problem with the abolitionist position is that the priority given to eliminating nicotine will mean more harm—more cancer and heart disease. This is because a different guiding priority leads, by design, to different trade-offs. If the goal is ending nicotine use, the abolitionist is more likely to be indifferent to whether someone is vaping or smoking. But those behaviors have very different impacts on health. A thought experiment illustrates the trade-off problem: Hypothetically, would you prefer 20 percent smoking or 10 percent smoking and 30 percent vaping? The second case means twice the nicotine use but half the smoking and much less harm. So while they may see the abolition of nicotine as a pure and uncluttered outcome, it will involve a lot more death and disease in the interim and probably indefinitely. Consider the EU ban on snus, which came into effect in 1991. For the abolitionists, this looks like an incremental step toward their nicotine-free society. To the transformers, it seems like a lost opportunity that puts dogma before health. In the intervening 30 years, how many smokers have been denied the option to almost eliminate their risk while the European Union continues to suffer about 700,000 smoking-related deaths annually? The ban on snus is not a step forward in the march toward a nicotine-free society but a step backward in the imperative to transform the European nicotine market.

    Governments are the Real Transformers

    In its February 2021 investor day press release, Philip Morris International made a short but remarkable statement about transformation: “The company believes that with the right regulatory frameworks, dialogue and support from civil society, cigarette sales can end within 10 to 15 years in many countries.” The company is saying to investors that its cash-cow—cigarettes—could be obsolete within the typical corporate planning horizon. This is a striking recognition of just how fast things could change if the transformation strategy were pursued purposefully by all parties. The other important idea here is that transformation needs to be a joint undertaking: Governments set the regulatory and fiscal framework. Governments, civil society, health professionals and academia create the “information environment,” shaping what people see, hear and think about their options. Imagine if everyone with a serious stake in public health got fully behind a transformation strategy?

    The Abolitionists Fighting Transformation

    The abolitionists are threatened by transformation as it will deny them the justification for a nicotine-free society. So they are fighting transformation, with agencies right up to the WHO pressing for the outright prohibition of noncombustible products or regulations that would treat low-risk products no differently than high-risk cigarettes. This approach has nothing to do with health and everything to do with the threat that low-risk products present to the goal of the nicotine-free society. We also see anti-tobacco activists trying to block the diversification strategy of tobacco companies—for example, making the absurd argument they should not even use their biotech capabilities to try to make Covid-19 vaccines. In the most disturbing case so far, activists tried to block tobacco industry diversification through the acquisition of a pharmaceutical company specializing in inhalation technologies. Once the transaction was completed, they threatened the employees with ostracization. One day, these scientists were good guys; the next day, they were bad guys, even though they were doing the same thing with the same purpose—just with different owners.

    It’s almost as if these activists need tobacco companies to be permanent cigarette companies and nothing else. Perhaps they need an unambiguously evil enemy that fits their activist business model rather than a transformation that threatens to deny them the reason to exist.

  • Spanner in the Works

    Spanner in the Works

    Photo: Mariakray

    A patent dispute derails the U.S. rollout of IQOS.

    TR Staff Report

    The deadline of Tobacco Reporter’s December print edition coincided with one for the U.S. Trade Representative to overturn a ruling preventing Altria Group subsidiary Philip Morris USA from importing Philip Morris International’s IQOS tobacco-heating device following a patent dispute.

    On Sept. 30, the International Trade Commission upheld an initial determination that PMI’s IQOS device infringes patents owned by BAT. As a result of the ITC ruling, Philip Morris USA has been barred from importing PMI’s IQOS 2.4, IQOS 3 and IQOS 3 Duo heat-not-burn traditional cigarette products. It was also ordered to halt future sales of those products—marketed as Marlboro HeatSticks—already in the U.S.

    Altria Group asked trade representative Katherine Tai to overturn the ban. Tai had 60 days to do so. By Nov. 30, however, the U.S. Trade Representative’s office confirmed to Bloomberg that no action had been taken by Tai, meaning the IQOS import ban stands.

    BAT welcomed the development. “Today’s announcement provides a measure of success for our enforcement of intellectual property rights to ensure we can continue to innovate, as is common practice among innovation-based industries,” Gareth Cooper, BAT’s assistant general counsel, said in a statement. “As we have strenuously noted, there was no reason to overturn the policy.”

    Altria expressed disappointment with the decision. “We continue to believe that the plaintiff’s patents are invalid and that IQOS does not infringe on those patents,” the company said in a statement.

    “The ITC’s importation ban makes the product unavailable for all consumers who have switched to IQOS, reduces the options for the over 20 million smokers looking for alternatives to cigarettes and ultimately is detrimental to the public health.”

    This sentiment was echoed by Gregory Conley, president of the American Vaping Association, at the time of the ITC’s Sept. 30 decision.

    “By potentially denying them the opportunity to switch to a harm reduction production IQOS, the real losers of this protracted court battle could end up being American adult smokers,” Conley said.

    “While some may use vaping, snus or pouches in the absence of IQOS, far too many American adults will choose to just smoke cigarettes instead.”

    The U.S. Food and Drug Administration authorized IQOS for sale in April 2019. The products debuted in test markets in Atlanta in October 2019 and Richmond, Virginia, in November 2019. During the second quarter, Philip Morris USA expanded retail distribution of Marlboro HeatSticks into the Triad and other metro areas of North Carolina as well as northern Virginia and Georgia.

    In immediate financial terms, the import ban has limited impact on PMI and Altria. IQOS in the U.S. is currently not a meaningful contributor to the companies’ earnings, according to Morgan Stanley. Nonetheless, IQOS is a key element in Altria’s shift away from traditional tobacco products, which have seen falling demand. To achieve its mission “to responsibly lead the transition of smokers to a smoke-free future,” Altria will need a viable alternative to combustible cigarettes in its portfolio.

    Altria will likely appeal to the U.S. Court of Appeals for the Federal Circuit, which handles patent lawsuits. That process could take up to a year to reach a decision, with the likelihood of a successful appeal not favorable, according to industry analysts.

    In the worst-case scenario for Altria and Philip Morris, the two companies would have to go back to the drawing board, moving production to the U.S. or changing up the design enough to avoid patent infringement claims.

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  • Down to the Wire

    Down to the Wire

    Photo: kurgu128

    Uncertainty lingers about the future for vaping as the FDA decides the fate of the remaining marketing applications.

    By Stefanie Rossel

    Two months after the Sept. 9, 2021, deadline for the U.S. Food and Drug Administration to determine the fate of millions of premarket tobacco product applications (PMTAs), uncertainty continues to prevail, and the fate of e-liquids with flavors other than tobacco remains unclear. The agency’s approach to e-cigarette regulation to date, alternatingly labeled a “fiasco” or “bureaucratic chaos” by critics, suggests that the U.S. may be heading toward a de facto ban of all nontobacco flavors.

    The 2009 Tobacco Control Act (TCA) gave the FDA authority to regulate cigarettes, smokeless tobacco, cigarette tobacco and roll-your-own tobacco. The “deeming rule” of Aug. 8, 2016, extended the agency’s authority to electronic nicotine-delivery systems (ENDS), cigars, pipe tobacco, nicotine gels and hookah tobacco. As a result, deemed products are now subject to all TCA rules, including the requirement that any new tobacco product must receive premarket authorization from the FDA to be legally marketed.

    Following litigation by anti-tobacco groups, a court set the deadline for manufacturers to submit their applications by Sept. 9, 2020, and gave the agency one year to decide on them. The time frame presented a daunting challenge to the chronically understaffed agency. The FDA received more than 6.5 million marketing applications for newly deemed tobacco products alone. At press time, the agency had acted on more than 98 percent of these applications. Its actions included refuse-to-accept letters to more than 200,000 applications, a refuse to file order for approximately 4.5 million products submitted by a single company and marketing denial orders (MDOs) for more than 1 million nontobacco-flavored ENDS. Only three new tobacco products received marketing granted orders. The FDA still needs to rule on applications covering about 80,000 products, including those submitted by market leaders such as Juul and NJOY.

    David Sweanor

    Retroactive Change of Requirements

    Most of the MDOs were directed at vape products with flavors other than tobacco, including menthol. The manufacturers, the agency claimed in its MDO letters, had failed to provide sufficient evidence that their nontobacco-flavored products deliver a net public health benefit for adult smokers compared with the “threat posed by the well-documented, alarming levels of youth use” of flavored vapes through either a randomized controlled trial in which a specific group of people is examined through intervals of time, or a longitudinal cohort study, which tracks large groups of people over an extended period of time.

    “It appears that the FDA is planning to significantly hobble the vaping category and thus protect lethal cigarettes from what is perhaps the greatest threat that business has ever faced,” says David Sweanor, adjunct professor of law at the University of Ottawa. “But how far this succeeds depends on many factors, not least what the courts will say about the process.”

    The requirement is now part of the PMTA rules, which the agency finalized in October 2021, and which took effect in November. However, it had not been in the original guidance for PMTA applications, according to critics.

    For most smaller vape manufacturers, the FDA’s ruling has meant the end of their business activities. “Like most vape companies, we cannot remain financially viable with only two [tobacco-flavored] products, and we will most certainly be forced to close our business after eleven years,” California-based Kai’s Virgin Vapor states on its website.

    Paul Blair

    Temporary Stays Granted

    Others have taken legal action. Arguing that the FDA moved the goalpost by retroactively changing the PMTA requirements, MDO recipients filed more than 40 petitions for review and stay on the grounds that the FDA had acted in an “arbitrary and capricious manner.” At the time of writing, at least five companies had been granted a temporary stay either by the FDA or the courts, and their products were back under review.

    Among them was Turning Point Brands, which may now continue to market its vapor products while its PMTAs are being reassessed. “We’re encouraged that the agency has acknowledged the robust nature of our PMTAs for a wide range of tobacco, menthol and other flavored vapor products,” Paul Blair, vice president of government affairs at Turning Point Brands, told Tobacco Reporter. “These open system e-liquids, sold predominantly in vape shops across the U.S., play an important role in providing reduced-risk options to more than 30 million adult smokers who may be looking for alternatives to combustible cigarettes. It is our hope that at the end of the PMTA review process, the agency will preserve the important off-ramp from cigarettes to a wide range of vapor products used by adults. Preserving these options will ensure that the diverse vapor marketplace can help ultimately achieve a more significant reduction in smoking rates across the U.S.”

    “The cases look strong,” Sweanor states. “Administrative bodies, like referees in sporting competitions, are challenged when they seek to change the rules mid-game. This is supposed to be an example of transparent rule-making in a democratic society. There is also a history, in the U.S. and globally, of vaping companies using the courts to overturn laws and administrative rulings that have overly restricted their products and marketing.”

    However, a second review does not guarantee that the products will receive authorization. Critics fear that manufacturers who have received an MDO will continue to appeal the decisions to maximize the time to sell their products. THR advocates hope that legal challenges will force the FDA to make more careful decisions.

    Uncertain Future for Flavors

    There are many indications that the era of nontobacco vapor flavors is coming to an end in the U.S. After bombarding the vapor business with MDOs, the FDA on Oct. 12 approved R.J. Reynolds Vapor Co.’s Vuse Solo and accompanying tobacco-flavored e-liquid pods—the first-ever marketing granted order for an e-cigarette.

    Tobacco harm reduction advocates received the news with mixed feelings. While welcoming the agency’s acknowledgement that vape products can help adult smokers to quit cigarettes, they were disappointed that the order pertained to an outdated device with few users. Furthermore, while authorizing two Vuse tobacco-flavored e-liquid pods, the agency issued 10 MDOs for Vuse Solo nontobacco-flavored pods, claiming that Reynolds failed to demonstrate they were appropriate for the protection of public health.

    The agency is still evaluating Reynolds’ application for menthol-flavored products under the Vuse Solo brand. Menthol is another bone of contention: In late April, the FDA announced that it would initiate a notice and comment rule-making process to ban menthol-flavored cigarettes and all characterizing flavors in cigars and cigarillos within the next year. Vape manufacturers are hence unsure of whether their mentholated products will remain on the market.

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    Sloppy Assessment

    In its denial of providing marketing authorization to nontobacco-flavored e-liquids, the FDA referred to the most recent National Youth Tobacco Survey (NYTS), arguing the study had shown that among the estimated 2 million middle school and high school students that were using e-cigarettes in 2021, more than eight in 10 were using nontobacco-flavored vape products. It did not mention that, according to the same study, the use of e-cigarette among youths has more than halved over the past two years, from 27.5 percent in 2019 to 11.3 percent currently.

    Critics have accused the FDA of being “obsessed with youth vaping rates and flavors.” The online publication Filter revealed that, in order to cope with the unprecedented flood of PMTA submissions before the court-ordered deadline, the FDA relied on a database query to identify the top-12 manufacturers with the largest number of pending PMTAs for nontobacco-flavored e-liquid products not in the third of three FDA review phases.

    This approach allowed the agency to filter out 85 percent of all pending PMTA applications. It then introduced, apparently for the first time, a “fatal flaw” standard. The fatal flaw review is a simple review in which the reviewer examines the submission to identify whether or not it contains the necessary type of studies. “The fatal flaw review will be limited to determining presence or absence of such studies; it will not evaluate the merits of the studies,” according to an FDA Center for Tobacco Products Office of Science memorandum cited by Filter.

    With its attempt at speeding up matters, the agency has done itself no favors, say critics. The road to regulatory certainty in the U.S. vape market will likely become even longer. “At this point,” Sweanor suggests, “the solution could be to announce reasonable product standards aimed squarely at reducing harms—as is done with foods—rather than treat each subcategory of each product as if totally independent of other products.”

  • Fighting the Last War

    Fighting the Last War

    A new report by Knowledge-Action-Change urges the World Health Organization to embrace safer nicotine products.

    By George Gay

    On the face of it, it seems odd that a case has to be made for the promotion of safer nicotine products (SNPs) as part of a global tobacco harm reduction (THR) strategy. But making this case, in large part, is the aim of a report published by the U.K.-based public health agency Knowledge-Action-Change (KAC) and launched at a hybrid event on Oct. 27 in London. And it has to be said that the case needs to be made, as becomes clear toward the end of the report, in a section looking toward the future, where it is stated that it is a “moral imperative” that the World Health Organization and its allies retrench from their current “intransigent and obstructive position of not only refusing to accept any positive health benefits from SNPs but actively campaigning against their use.”

    I would agree wholeheartedly with the general sentiment being expressed here, but invoking morality is problematic, I believe. The idea of an overarching morality is not universally accepted because a lot of people believe “morality” resides in the preferences individuals or groups of people have. And, in fact, Harry Shapiro, the author of the report Fighting the Last War: The WHO and International Tobacco Control, seemed to acknowledge this point when, speaking at the launch, he said everybody working in tobacco control was aiming to reduce smoking but that tobacco control split into two broad camps: one comprising those who supported SNPs and THR and the other comprising those who didn’t. This was a good concession to make because having the word “war” in the title of the report seemed to be pointing us back down a road we surely don’t want to travel.

    Misguided and Irrational

    Having said that, this is a good report aimed at challenging the direction of travel of tobacco control under the auspices of the WHO’s Framework Convention on Tobacco Control (FCTC) ahead of the Conference of the Parties to the FCTC, COP9, which was due to take place virtually on Nov. 8–13 (after this report was written). In doing so, the report seeks to address what must surely be one of the most unsound and unreasoned strategies ever to have arisen within the international health community. Put briefly, it is about the WHO and its allies being not immoral but, more worryingly, misguided and irrational.

    According to the WHO, an epidemic of cigarette smoking is currently causing the deaths of 8 million people a year, usually referred to as “premature deaths,” a phrase up there with “pre-ordering” in the list of linguistic curiosities. But while a number of SNP products have been developed that can wean people off tobacco smoking, the most powerful international body charged with protecting the health of people around the world has decided it would be best not to use these products but to apply the old “quit-or-die” patch to the gaping wound. After all, quit-or-die has a long track record whereas the products being offered up are—mention it only in hushed tones—new or newish. The fact that the long track record of quit-or-die is, like the art of bleeding patients, one largely comprising failure seems not to enter the thinking of the WHO and its allies.

    But perhaps this isn’t fair. The report makes the point that the number of smokers worldwide has remained at 1.1 billion for the past 20 years, during which time, I understand, the world’s population rose from 6.11 billion to 7.75 billion, so it could be argued that the number of smokers would, without intervention and with all other things having remained equal, have risen to 1.38 billion. So what has occurred might not be failure, I guess, but it is hardly a galloping success.

    Of course, it might be said correctly that individuals and states are not bound to follow the WHO’s advice, but it is often the case that they do, perhaps because of the peculiar tendency of humans to create or invent institutions or belief systems and then slavishly accept the advice purportedly coming out of them, no matter how daft, rather than go back and question whether there was a fault in the original idea that gave rise to the institution or belief system.

    But I would not recommend going back to question the setting up of the WHO itself, which, to my mind, should be a powerful force in the global fight against transmissible diseases, but to question the WHO’s FCTC, whose provisions are used to steer the direction of travel of the international tobacco control movement.

    A Matter of Interpretation

    Harry Shapiro

    The report does an excellent job of explaining the roles of the WHO, the FCTC, the Conference of the Parties to the FCTC and the FCTC secretariat, the relationship between them and the decision-making processes they employ. This section of the report doesn’t make encouraging reading, however, though it largely defends the FCTC’s provisions and blames the way they are interpreted for the failure to embrace SNPs and THR. It is said that the provisions of the FCTC are no bar to the consideration of scientific advances, new technologies, economic circumstances and the concept of THR. But this is surely no reason to keep heading down the same road hoping things are miraculously going to get better, especially given that the seemingly unaccountable FCTC secretariat is making much of the running, and nation states tend to go with the flow, unlike when they discuss other global issues such as trade. There have been eight FCTC-based COP meetings since the COP first met in 2006, and I cannot help thinking that, given the lack of progress it has made in 15 years of working with the FCTC, the decent thing to do would be to put the COP and the FCTC out of their misery.

    One of the problems identified in respect of COP meetings is that they are almost totally exclusive, owing to a particular interpretation of an FCTC provision. And a comparison is made in the report, and was repeated by others at the report launch, of the FCTC COP meetings and those associated with the Framework Convention on Climate Change (FCCC). The tobacco COPs were said to be shrouded in a level of secrecy comparable to U.N. Security Council meetings whereas to be an observer at the FCCC COP, it was necessary only to demonstrate representation of a national or international body and relevant experience. The inference was that if more people were allowed to observe and even take part in the tobacco COP, things would be better.

    I hate to spoil the party here, but the comparison is a little out of proportion, to my way of thinking. Tobacco COPs look at consumer choices involving various tobacco and nicotine products whereas the FCCC COPs are about trying to prevent the whole of humankind going belly up. The comparison seems also to gloss over the evidence. As I write this, the FCCC COP, COP26, is about to start and is widely expected to end largely in a PR-burnished failure, with the result that the world will be plunged deeper into the existential crisis it is already in and from which it is unlikely to be able to row back. Having more participants doesn’t seem to guarantee success, at least not on its own, even where the fate of the earth hangs in the balance.

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    The Way Forward

    So, how could things be arranged to ensure a more beneficial outcome to the problem of tobacco smoking? Well, through the employment of THR, where harm reduction is defined in the report as “a range of pragmatic policies, regulations and actions that either reduce health risks by providing safer forms of products or substances or encourage less risky behaviors with an important role in championing social justice and human rights for people who are often among the most marginalized in society.” One of the most frustrating aspects of the refusal of the WHO and parties to the FCTC to embrace THR is that the WHO employs harm reduction in respect of other health issues. Such an inconsistent stance is difficult to understand, but then perhaps there is a visceral satisfaction in bleeding the patient, either actually or metaphorically, through taxation, the main weapon in the quit-or-die armory. Increasing tobacco taxation is held up as a quit-or-die success story, but, in fact, it is a strategy that further impoverishes the often less well-off while providing a boost for black marketers.

    Under a section titled “What can be done? New thinking for the 21st century,” it is said that parties to the FCTC should press for more evidence-based discussions on THR and SNP. This is a nice thought, but given the history laid out in the report, I wonder if it can lead anywhere helpful. I’m sure COP participants believe they are making evidence-based decisions already, but my guess is, to get back to my original point, they are viewing only the evidence that is able to squeeze through their locked-in “moral” filters. The more alcohol they quaff together, the more they come together in the belief that nicotine is evil and shouldn’t be enjoyed. Evidence is no guarantor of success. The EU’s deadly ban on snus, a ban that defies all reason, has been upheld in the courts.

    Under the same section, it is said also that a pragmatic route forward could be the establishment of a working group on THR to take the FCTC forward into the 21st century in a world where SNPs are now available. This, too, is a good thought, but again, given the history laid out in the report, one that might be difficult to pull off. Still, nothing ventured, nothing gained, and the report describes five ways in which such a working group might be able to move things forward.

    One of the key starting points is said to be disaggregating combustible and more dangerous oral tobacco products from safer noncombustible products. But is this likely when, in a world where we hang onto the belief that the U.S. Food and Drug Administration is the paragon of scientific reason, that agency feels it right, and has the right, to “deem” electronic cigarettes to be tobacco products?

    It is easy to become gloomy about the situation, especially when it is considered that even if a smoker is saved from a tobacco-related death through switching to an SNP, she is anyway more likely now to die of a pollution-related disease (for which there is no COP), or, slightly further into the future, the effects of a climate change event.

    But, looking on the bright side, there is a powerful and growing force in support of THR, and it was on display at an event in London on the day following the launch of the Fighting the Last War report. The THR scholarship program, which is described as the jewel in the crown of the KAC, was the subject of a separate report, Tobacco Harm Reduction Scholarship Program: The First Three Years 2018–2021, which describes how the program has built an extensive network of advocates raising awareness of THR around the world.

    The report is worth reading. Although I was aware of the program, I had no idea how extensive it had become. Since its launch, the program has attracted 260 applications and has taken on 75 scholars from 33 countries, 18 of whom have gone on to enhanced scholarships. But perhaps the most significant figures are those describing how 95 percent of the scholars are still working in THR, 27 percent full-time, 50 percent part-time and 18 percent on a voluntary basis.

    The Oct. 28 event was an opportunity also to celebrate the life of Kevin Molloy (1957–2021), who, from 2018 until earlier this year, was head of the scholarship program.

    The Fighting the Last War report, which is part of a series of Global State of Tobacco Harm Reduction reports from KAC, and the scholarship program are funded by grants from the Foundation for a Smoke-Free World, a U.S. nonprofit organization that had no role in the planning or execution of either project.