Category: News This Week

  • Progress Toward Smoke-Free Objective

    Progress Toward Smoke-Free Objective

    Photo: Hanyyyy | Dreamstime.com

    Philip Morris International today published its first integrated report, a comprehensive overview of the company’s environmental, social and governance (ESG) performance and its progress toward delivering a smoke-free future—including the company’s ambition to switch more than 40 million adult smokers to its smoke-free products by 2025, with half of the total to come from non-OECD countries.
     
    “Since we announced our smoke-free commitment in 2016, we have made enormous progress in terms of organizational capabilities, the integration of sustainability into every aspect of our transformation, and our business,” said Andre Calantzopoulos, CEO of PMI.
     
    Among other things, the integrated report shows that PMI directed 98 percent of total R&D expenditure and 71 percent of total commercial expenditure toward smoke-free products in 2019.
     
    PMI’s smoke-free product net revenues reached 18.7 percent of total net revenues in 2019 compared to 2.7 percent in 2016. In 2019, net revenues from smoke-free products exceeded 50 percent of total net revenues in four markets.
     
    PMI’s smoke-free product shipment volume increased to approximately 60 billion units in 2019, up from 7.7 billion in 2016. The company’s combustible product shipment volume in 2019 declined to 732 billion units, down from 845 billion in 2016, partly reflecting the impact of adult smokers switching to PMI’s smoke-free products.
     
    Since announcing its smoke-free vision in 2016, PMI has delisted more than 600 cigarette stock-keeping units (SKUs) globally while broadening its portfolio of heated-tobacco units to more than 400 SKUs.
     
    At year-end 2019, there were an estimated 9.7 million users worldwide who have stopped smoking and switched to PMI’s heat-not-burn smoke-free product IQOS compared to 6.6 million in 2018, according to the report.
     
    On the ESG front, the integrated report highlights PMI’s youth access-prevention programs, initiatives to mitigate environmental risks and impacts across its value chain and efforts to improve the wellbeing of is farming community.
     
    “Our integrated report aims to provide a comprehensive overview of what PMI is about combined with a holistic set of metrics that go beyond our financial disclosures, covering our business transformation as well as environmental, social and governance topics,” said Huub Savelkouls, chief sustainability officer at PMI.

  • KT&G Researcher Recognized

    KT&G Researcher Recognized

    KT&G Senior Researcher Kim Ik-jung (Photo: KT&G)

    A KT&G researcher has received the Prime Minister Award in recognition of his contribution to industrial development in South Korea.
     
    KT&G Senior Researcher Kim Ik-jung was recognized for his development of a fat-soluble liquid encapsulation technology previously held only by prominent pharmaceutical manufacturers in Japan and Europe, and for securing patent rights in Korea and overseas.
     
    The technology enabled KT&G to localize the production of tobacco capsules, for which it previously relied on imports from Japan. The technology could potentially also be used in other industries, including medicines and foods.
     
    The award was presented June 24 on South Korea’s 55th Invention Day, an event organized by the Korean Intellectual Property Office and hosted by the Korea Invention Promotion Association.

  • PMI Countersues RJR For Patent Infringement

    PMI Countersues RJR For Patent Infringement

    Photo: PMI

    Philip Morris International (PMI) filed counterclaims against R.J. Reynolds Tobacco Co. (RJR) for patent infringement in the federal court action that RJR commenced against PMI and Altria, PMI’s IQOS distributor in the U.S., on April 9, 2020 in the Eastern District of Virginia.

    PMI also filed a partial motion to dismiss RJR’s claims against it. PMI believes that RJR’s infringement action is without merit, and that RJR’s own electronic nicotine delivery system (ENDS) products infringe multiple patents owned by PMI and Altria. PMI is bringing counterclaims to recover “the considerable damages” caused by RJR’s infringements.

    “RJR appears to have brought this action in the hopes of stopping [PMI’s] innovative IQOS heated tobacco system, which has a proven track record in switching smokers away from combustible cigarettes, from disrupting its core business in combustible cigarettes and overtaking its secondary line of e-vapor products,” the filing states.

    “Having failed to develop a competing offering in the heated tobacco space, RJR apparently now seeks to block that space in its entirety by bringing this meritless litigation. But in its haste to do so, RJR has overlooked the fact that its own line of e-vapor products (which are far less effective in switching smokers away from combustible cigarettes than IQOS) infringe multiple patents owned by [PMI].”

    The counterclaim alleges that RJR was concerned by the commercial threat posed by IQOS, and RJR is now attempting to stop IQOS with this case. “But in its haste to stop IQOS, RJR committed two fatal errors. First, it asserted meritless patent claims,” the filing states. “Second, it overlooked the fact that its own e-vapor products infringe multiple patents owned by [PMI] and co-defendants Altria Client Services and Philip Morris USA, Inc. [PMI] thus responds to RJR’s Complaint and brings counterclaims to recover the considerable damages flowing from RJR’s infringement.”

  • Singapore Enacts Plain Packaging Law

    Singapore Enacts Plain Packaging Law

    Photo: PixaBay

    Cigarette manufacturers operating in Singapore will be required to sell their products in standardized packaging starting July 1, reports The Straits Times.

    The new rule, which also mandates enlarged graphic health warnings, will apply to all tobacco products, including cigarettes, cigarillos, cigars, bidis and roll-your-own tobacco products, according to the Ministry of Health (MOH).

    Announced on Oct 31, 2018, the measures are intended to encourage smokers to quit and discourage nonsmokers from picking up the habit.

    As part of the new regulations, tobacco companies will have to remove from their product packaging all logos, colors, images and promotional information.

    The graphic health warnings must cover at least 75 percent of surfaces, up from the current 50 percent.

    Non-compliance is punishable with a fine of up to SGD10,000 ($7,171), jail of up to six months, or both, for first-time offenders.

    Those with a prior qualifying conviction will face heavier penalties.

    The government of Singapore had given tobacco manufacturers, importers, wholesalers and retailers a year to prepare for the new measures.

    The Health Sciences Authority also sent letters and e-mails to remind tobacco licensees of the new packaging regulations.

  • Challenge to Cigarette Ban Dismissed

    Challenge to Cigarette Ban Dismissed

    South Africa’s ban on tobacco sales has caused the black market for cigarettes to explode, according to industry sources (Photo: BAT)

    The Pretoria High Court has dismissed a bid by the Fair Trade Independent Tobacco Association (Fita) to lift South Africa’s ban on cigarette sales during the country’s coronavirus lockdown.

    South Africa banned the sale of tobacco in March and extended the measure even as it lifted its ban on alcohol sales on June 1.

    In announcing the High Court ruling, Judge President Dunstan Mlambo referenced the country’s state of disaster.

    He said disasters, by their nature, may result in unforeseen consequences, but governments have to implement measures to manage and contain them.

    The court also rejected Fita’s argument that cigarettes ought to have been considered essential because they are addictive.

    “The fact that a substance is addictive does not render it essential,” it stated. “We therefore find no basis on which to interpret the level 5 regulations as permitting the sale of tobacco products.”

    Fita will reportedly appeal the judgment.

    A separate challenge to the tobacco ban, brought by local market leader British American Tobacco (BAT), is scheduled to be heard in August.

    Unlike the case mounted by Fita, BAT challenges the constitutionality of the ban.

    In an affidavit, BAT South Africa executive Andre Joubert argues the government failed to make a convincing legal argument that the ban was legally necessary or to provide legitimate arguments to show smoking increased the chance of contracting Covid-19, or that smokers would be worse off than nonsmokers if they contracted the virus.

    Citing the rapidly rising illegal trade in cigarettes, BAT is pleading to have the case heard earlier than August.

  • Court Upholds FDA Authority Over Vaping

    Court Upholds FDA Authority Over Vaping

    Photo: Michal Kalasek | Dreamstime.com

    The 5th U.S. Circuit Court of Appeals has upheld the U.S. Food and Drug Administration (FDA)’s authority to regulate e-cigarettes as tobacco products, reports Reuters.

    A unanimous panel ruled Thursday that Congress’ decision to delegate vaping regulation to the FDA was constitutional under the non-delegation doctrine because Congress had articulated an “intelligible principle” in delegating authority to determine what qualified as a tobacco product to the FDA.

    The 5th Circuit’s ruling is the latest rejection of a series of legal challenges from the vapor industry.

  • Cerulean Appoints New Head of Sales

    Cerulean Appoints New Head of Sales

    Paul Glenn (Photo courtesy of Cerulean)

    Paul Glenn, head of sales and aftersales at Cerulean, will be retiring at the end of 2020.

    He will be succeeded by Gianmarco Guiduzzi, who joins Cerulean from G.D where he worked as a key account manager for multinationals within the tobacco sector.

    With a master’s degree in engineering from Bologna University and an executive MBA from Bocconi University, Guiduzzi is well qualified to deal with the ever-changing tobacco market, according to Cerulean.

    Guiduzzi will act as head of sales and aftersales designate until Glenn’s retirement.

    “I’d like to personally thank Paul for his dedication and service during his time here at Cerulean and wish him a long, happy and healthy retirement,” said Steve Frankham, managing director of Cerulean.

    “I’d like to take the opportunity to welcome Gianmarco to the Cerulean team. Gianmarco has been working closely with Cerulean since the Coesia acquisition in 2017 and I have the greatest confidence that he will pick up where Paul has left off and continue to grow the business.”

    Glenn has spent much of his working life in the tobacco industry. He joined Cerulean in 2008 from Courtaulds Acetate where he was sales director for 10 years.

  • Georgia Likely to Tax Vapor Products

    Georgia Likely to Tax Vapor Products

    Photo: Theerapan Bhumirat | Dreamstime.com

    Georgia’s General Assembly passed a measure Friday to authorize the taxation of vapor products, reports the Athens Banner-Herald. The bill also raises the U.S. state’s minimum age to vape or smoke cigarettes from 18 to 21.

    The measure slaps a 7 percent excise tax on vaping products such as e-cigarettes, vape pens, refillable cartridges and electric hookahs.

    The vaping tax was added to a separate bill that raises the minimum age to use tobacco and vape products to 21. The bill passed by a 45-8 vote in the Senate Friday after the state House passed it by a 123-33 vote on Thursday. It now heads to Governor Brian Kemp for his signature.

    Vapor product manufacturers and vape store owners had opposed the excise tax and new licensing rules, arguing higher prices on vaping could drive smokers back to cigarettes after using the tobacco-less products to kick the habit.

  • Former STMA Official Gets Life in Prison

    Former STMA Official Gets Life in Prison

    Photo: Andrianocz | Dreamstime.com

    Zhao Hongshun, former deputy head of the State Tobacco Monopoly Administration (STMA), was sentenced to life imprisonment, deprived of political rights for life and had all his personal property confiscated on June 18 for taking bribes worth more than RMB90 million ($12.7 million), according to a news release issued by The Supreme People’s Court of the People’s Republic of China.

    The Huai’an Intermediate People’s Court in East China’s Jiangsu province issued the verdict, saying the money involved in Zhao’s case will be turned over to the state treasury. Zhao said in court he would not appeal.

    According to the complaint, Zhao took advantage of his positions, including that of deputy director and deputy head of the economic operation department of the STMA and deputy director of the Anhui Provincial Tobacco Monopoly Administration, to assist individuals and companies in contracts related to the printing of cigarette labels, tobacco advertising business and personal promotion from 2002 to 2018.

    Zhao was placed under investigation by China’s top graft watchdogs in February 2019. He was expelled from the communist party and removed from public positions and arrested in July. In September 2019, Zhao was charged with bribery.

  • Pending Ban Triggers Run on Nicotine Vapes

    Pending Ban Triggers Run on Nicotine Vapes

    Photo: Ethan Parsa from Pixabay

    Australians have started stockpiling e-cigarettes after their government announced it would ban imports of most vapor products, reports the Daily Mail.

    From July 1, it will be illegal to import e-cigarettes and refills containing nicotine liquids or salts.

    New Zealand’s leading retailer of vaping supplies, Shosha, recorded a 130 percent spike in sales from Australia since the announcement. Shosha also experienced a 44 percent increase in foot traffic compared to the same time last year.

    Under Australia’s new regulations, individuals would need to visit a doctor and be issued a prescription to purchase their nicotine containing e-cigarettes or refills.

    Even valid prescription holders would still be prohibited from purchasing the devices from overseas themselves.

    The ban on importing nicotine e-cigarettes and refills would be in line with existing bans on their sale in each state and territory.

    The prohibition would last 12 months while the government conducts a public consultation on the regulation of nicotine products by the Therapeutic Goods Administration.

    The regulation would see nicotine products added to the Poisons Standard making them prohibited permanently with the exception of tobacco cigarettes and smoking-cessation products such as gums and patches.

    The Coalition of Asia Pacific Tobacco Harm Reduction Advocates (CAPHRA) has protested Australia’s ban, saying it will deprive millions of vapers and existing smokers of their rights to access better alternatives to combustible cigarettes.

    “Smokers in Australia have been denied access to a proven harm reduction tool and vapers in Australia have yet again been dealt a potentially fatal blow which will see many of the 300,000 strong vaping community go back to smoking cigarettes,” CAPHRA Executive Director Nancy Loucas said in a statement.

    The group pointed to studies showing that e-cigarettes are 95-percent less harmful than combustible tobacco because they do not involve combustion. “It has been known for decades that tar, and carcinogens found in tobacco smoke, cause the death and disease associated with smoking, and not nicotine,” CAPHRA stated.