Category: Print Edition

  • Peddling Trivia

    Peddling Trivia

    They find it not unpleasant. (Photo: Colleen Williams)

    A Japanese government survey ‘reveals’ that nonsmokers find smoke unpleasant while smokers like it.

    By George Gay

    According to a recent government of Japan survey, about 83 percent of Japanese people aged 18 and older find tobacco smoke unpleasant. The Cabinet Office survey, reported by Kyodo News, questioned 3,000 people online and via email during August and September last year and resulted in 1,556 valid responses. Slightly more than 56 percent of respondents said they found tobacco smoke unpleasant while about 26 percent reported they found it “somewhat unpleasant.”

    Such a survey probably cost the government relatively little, but, still, these are hard times, and I could have come up with the figure of 83 percent for free without bothering 3,000 people and while causing much less environmental degradation than the survey’s computer-based energy use would have caused and will continue to cause through the electronic storage of its results in multiple versions and places. You see, just a couple of clicks on the internet will turn up the fact that the smoking prevalence in Japan is about 17 percent.

    I’m certain that I don’t have to explain my thinking here, but, just in case, let me underline it by saying the survey found that about 75 percent of men found tobacco smoke unpleasant while about 89 percent of women did so. And do you know what? The smoking incidence among men is about 27 percent while that among women is about 8 percent.

    Let the heralds sound the trumpets! Nonsmokers find tobacco smoke unpleasant while smokers like it or are indifferent to it!

    Or perhaps I should say that nonsmokers and nonvapers find smoke and heat-not-burn (HnB) vapor unpleasant. Japan is held up as an example of good practice when it comes to helping smokers switch to less risky forms of tobacco/nicotine consumption because, while its laws do not allow the use of electronic cigarettes that deliver nicotine, HnB devices are permitted and have gained much ground on the Japanese market. It is true that the survey report mentions only tobacco smoke, but I suspect that this is because many people are heavily into deeming things when they feel it convenient to do so. Smoke is vapor, and vapor is smoke, while a “smoke-free” country might have a smoking incidence of 5 percent and, in theory, a vaping incidence of 100 percent, even though vapor is considered to be smoke. You know the sort of thinking.

    When times are hard, or even when they are not, it is surely difficult to justify a government’s expending resources on such a survey. Is it possible that anybody believes that anything meaningful can be discerned from asking 0.002 percent of Japan’s population whether tobacco smoke, as they perceive it, is unpleasant or somewhat unpleasant? Is there a difference even? Surely, if something is unpleasant, it is also somewhat unpleasant, and if it is somewhat unpleasant, it is also unpleasant. Remember, we are asking people with presumably varying perceptions to distinguish a degree of unpleasantness within a single entity; we are not asking them to compare different entities.

    In the report I saw, it was not even clear to what unpleasant referred. Is it the look of the smoke? After all, tobacco smoke is one of the few air pollutants that is visible, and, if I am correct in assuming that vapor is deemed to be smoke, the sight of vapor would offend some. There are quite a lot of people, I have noticed, who become overwrought when vapers flaunt their exhalations. More likely, however, it is the smell of the smoke, but this would seem to reduce the value of the survey further. Haven’t we known for years the answer to the general question about whether Japanese people find tobacco smoke unpleasant? Isn’t it the case that the Japanese tobacco market is one of just a few where successful efforts have been made to sell cigarettes partly on the basis that they give off reduced tobacco smells? At one time, they were referred to in Japan, and might still be, as LSS (low smoke smell) cigarettes.

    But these surveys are taken seriously—to what I would regard as almost ludicrous levels. The Kyodo report explained how the previous survey into attitudes to tobacco smoke, conducted in 2019, discovered that 78 percent found it unpleasant while warning that the results from 2019 and 2022 could not be compared because of changes made to the survey methodologies. Does any of this matter? Is there a need to know this stuff that outweighs the environmental harms being caused? When desktop printers first arrived on the scene, it became common for documents that appeared on computer screens to contain notes asking the recipients to think before they printed them. This was sensible, but now, has the time come to impress on people whether there is a need to carry out the research they are contemplating and whether it is necessary to see the results of that research disseminated and stored?

    One of the major current debates is that around artificial intelligence (AI), often with conclusions being drawn without first defining what sort of AI is under discussion. As I understand things currently, I would welcome the takeover of humanity by AI if that AI were powered in all aspects by renewable energy, capable of self-replication and movement, had sensory systems at least as varied and efficient as those of humans and started its intellectual forays with no information inherited from its creators; or, if it were not possible to kick it off with no information, if it were supplied only with the three-volume Principia Mathematica on the foundations of mathematics by Alfred North Whitehead and Bertrand Russell.

    he effect of air pollution on people in Tokyo is equivalent to their smoking from 2.68 cigarettes to 4.25 cigarettes a week. (Photo: wooooooojpn)

    Time to Move On

    On the other hand, it would be a matter of deep concern to me if the AI that took over for humanity was not powered by renewable energy, not self-replicating, not capable of movement, had no or limited sensory systems and had its intellectual arteries clogged with the sorts of trivia—and here I would include the results of the survey under discussion—that is, in large part, the sum of the intellectual history of the human race. We, or our replacement AI, cannot move forward while dragging this history behind us. It would be like trying to replace an old and discredited product, such as a cigarette, with a proven, technologically advanced product, such as a vaping device, while shaking our heads and calling for more historical research into all the problems and tragedies that the old product caused previously. Let us move on. As far as is possible, let us start afresh.

    Don’t get me wrong, I’m not picking on the government of Japan; it’s just that I was asked to write about the country and, in doing some reading, was intrigued by the story of the survey or, at least, an aspect of it. I was about to pass over the story, in fact, when my mind latched onto the unpleasant/somewhat unpleasant issue. Such efforts as were put into the survey in question are wasted everywhere, and such waste is not limited to governments. The amount of money wasted on pointless research must be astronomical. We have known for decades that smoking is bad for you and that the main offense given to nonsmokers by smokers is not the health risks associated with secondhand smoke but its smell, mainly the lingering smell given off by ashtrays and garments worn by smokers.

    That’s not to say that the survey conducted in Japan did not serve a useful purpose. It provided the government with the assurance that it could mobilize the tyranny of the majority. “Although the government in April 2020 imposed a general ban on smoking in indoor spaces used by multiple people, nearly half of respondents answered they want stricter measures to stop secondhand smoking,” Kyodo reported. And of those wanting further restrictions, about 60 percent wanted them introduced in outdoor locations, such as streets and parks.

    Now I don’t want to cause these people any unnecessary anxiety, but, according to earth.org, the biggest sources of air pollution in Tokyo, for instance, have nothing to do with tobacco smoke. They are down to vehicle emissions and factory fumes. The worst and most widespread form of this pollution is fine particulate matter, PM2.5, that gets deep into lungs and has deleterious health effects similar to those caused by cigarette smoking, including increased respiratory and heart disease occurrences.

    Apparently, the effect of air pollution on people in Tokyo, depending on where in the city they operate, is equivalent to their smoking from 2.68 to 4.25 cigarettes a week. Now I would challenge any resident of Tokyo to smoke the equivalent of 2.68–4.25 cigarettes solely through the inhalation of secondhand smoke while out in the street or in a park. They would be pushing it to smoke the equivalent of a measurable fraction of a cigarette. So, if the government is worried about the health of Tokyo’s people, it should, rather than conduct surveys on people’s attitude to tobacco smoke, take action on … well, there is only so much free advice I am willing to give.

    Navel Gazing

    Of course, if you really want to waste your effort on surveys, there is no better way than navel-gazing. And the Japanese Cancer Association (JCA), while undoubtedly doing much good work, is also keen on conducting surveys of its own members. In February last year, as part of a piece entitled “Trends in smoking prevalence and attitudes toward tobacco control among members of the JCA 2004–2017,” it said that recently, use of new tobacco products, including HnB tobacco, had become prevalent among young people. “Tobacco industries advertise the lower risk of the product compared with cigarettes; however, long‐term risks and other potentially fatal risks are unknown,” it said. “To fight against a new enemy of tobacco control, our academic society should boost activities to study the risk of new tobacco products.”

    Note that while many people, including those at the hard-to-convince U.S. Food and Drug Administration, believe that at least certain HnB devices can provide smokers with alternatives to traditional cigarettes that are less risky to consume than cigarettes, and while the JCA admits that the long-term effects of consuming HnB products are unknown, it has declared them an enemy of tobacco control.

    In other words, we seem to be up against that form of “science” where the result is deemed, and the evidence sought to establish that result. This would be chilling even if it were confined to Japan, but the JCA has wider ambitions. “As a leader in the cancer research community, the JCA should take action to deal with the control of new tobacco products globally,” it said.

    George Gay is Tobacco Reporter’s European editor, but his territory spans the globe. Based in London, George has covered the tobacco industry since 1982, initially for a U.K.-based publication and since 2004 for Tobacco Reporter. George’s understanding of industry issues, combined with his keen sense of observation and dry wit, have earned him a loyal following among Tobacco Reporter’s readers.
  • Waste Not, Want Not

    Waste Not, Want Not

    Photos: Taco Tuinstra

    Atlas Agri wants to help Zimbabwe achieve its volumes by reducing post-harvest losses.

    By Taco Tuinstra

    Anybody who has worked in the trade knows that leaf tobacco can be a hairy business. Changing weather patterns, mounting regulations and cutthroat competition keep merchants on their toes. But few dealers will have experienced the industry’s hirsute dynamics as intimately as the people that built Atlas Agri. Not only did its management team get the company up and running in record time; they also vowed to refrain from shaving until they had bought 20 million kg.

    The idea for Atlas Agri arose when a group of like-minded tobacco veterans sat down and agreed that the time was right to establish a new company. Tobacco was in short supply globally, partly due to miscalculations of how Covid-19 would impact cigarette consumption (it went up instead of down). In Zimbabwe, the cabinet had just approved the Tobacco Value Chain Transformation Plan, which, among other things, calls for a significant crop boost. “There was lots of opportunity,” says Atlas Agri Managing Director Alex Mackay, who previously served as CEO of leaf operations at Premium Tobacco International. “It just made sense.”

    Atlas Agri incorporated in June last year—just in time to participate in Zimbabwe’s 2022–2023 crop cycle—and went to work immediately. The company set up an office and tobacco receiving/storage area in Harare in the cavernous halls of the Boka Tobacco Floors off of Simon Mazarodze Road. With an eye on future expansion into additional markets, Dubai made sense as the seat of Atlas Agri’s global headquarters.

    The startup process was made easier by the facts that the company’s leaders knew each other from previous engagements and had extensive experience in the tobacco business. In addition to Mackay, the management team includes Geoff Martin, who oversees finance and administration; Peter Kockott, who leads the agronomy department; and Eric Le Patourel, who is in charge of operations. International sales are coordinated from Dubai by Global Chief Finance Officer Michael Rust and Global Sales Executive Albert Edwards, whose career includes senior positions at Premium Tobacco, Imperial Brands and Limbe Leaf Tobacco Co.

    A hairy business:  Several members of the Atlas Agri team vowed to refrain from shaving until the company had bought 20 million kg.

    Brandon Palmer
    Benjamin Edwards
    Craig Dollar
    Craig Bydawell
    Dylan Jones
    Ross Mackay
    Jordan Allatt

    Supporting Farmers

    Atlas Agri’s experience also helped it quickly recruit farmers. Many growers remembered the company’s representatives from their roles at other leaf buyers, creating instant trust. Another factor driving growers’ enthusiasm, according to Kockott, was the fact that Atlas Agri offered them a well-thought-out package. Because most small farmers in Zimbabwe lack the means to finance their operations, contractors provide them with inputs ahead of the season and recover the cost after the tobacco has been grown. The system works if implemented carefully but also carries risks. In some cases, growers have been unable to repay their loans. Atlas Agri aims to prevent defaults by lending growers a practical input package without unnecessary fills and high-cost items. “It all comes down to debt bondage,” says Mackay. “Once you have a farmer who is less beholden to the contractor, he has a better chance of repaying his loan and to profit.”

    The strategy paid off. Despite its relatively late start last year, Atlas Agri signed contracts more than 15,000 farmers. Once the season got underway, the company kept supporting its growers. “We did not just give them a contract and then waited six months to collect the product,” says Mackay. Traveling in four-wheel drive vehicles and on motorbikes, Atlas Agri’s agronomy team frequently ventured into the countryside to assist its contracted farmers with agronomic advice. Such trips were made not only by junior leaf technicians but also by upper management, allowing growers to interact directly with company officials whose rank may have kept them in the office if they had worked for other tobacco buyers. “That personal touch—that has been a strong point of our approach,” says Mackay, borrowing a slogan popularized by Souza Cruz in Brazil.

    Due to inadequate infrastructure and other limitations, Zimbabwe’s small-scale growers lose up to 50 percent of their crops.

    Reducing Field Losses

    In addition to supporting its growers and serving its customers, Atlas Agri is eager to help Zimbabwe achieve the goals of its Tobacco Value Chain Transformation Plan. As Minister of Agriculture Anxious Masuka explained in Tobacco Reporter earlier this year (see “The Man Behind the Plan,” Tobacco Reporter, May 2023), the country aims to preside over a tobacco industry worth $5 billion by 2025. Part of that growth is to be achieved by moving beyond green leaf and processed tobacco into value-added products such as cut rag and cigarettes.

    Opportunities for such expansion, however, depend heavily on the willingness of international tobacco firms to invest in Zimbabwe—a factor outside of the nation’s control. This means that much of the desired income will likely have to be realized by bringing more leaf to market. The transformation plan aims for a 300 million kg crop by 2025—70 million kg more than its farmers were expected to deliver this year.

    One of the ways in which Atlas Agri hopes to boost production is by reducing growers’ post-harvest losses. Following a massive land reform program at the turn of the century, Zimbabwe’s tobacco sector is dominated by small-scale farmers. Whereas in 1998, the crop was produced by 1,500 commercial growers and fewer than 1,000 smallholders, the industry now comprises about 144,000 small farmers and between 300 and 400 commercial operations.

    Unlike their commercial counterparts, who are heavily mechanized with tractors, irrigation systems and forced-air curing tunnels, the smallholders run barebones operations. Due to inadequate infrastructure and other limitations, Zimbabwe’s small-scale growers may lose up to 50 percent of their crops, according to the Tobacco Research Board (see “The Scientific Approach,” Tobacco Reporter, June 2023).

    One of the major constraints is curing barn capacity. Many smallholders grow more tobacco than their barns can accommodate. Tobacco that ripens after the curing barn has filled up is often left to rot in the field. While this could be remedied by building more curing barns, Atlas Agri considers this a less-than-ideal solution for small growers. Erecting such structures, the company argues, will not only push farmers deeper into debt but also boost demand for wood as the fuel to cure tobacco and additional bricks, contributing to deforestation.

    So instead of constructing additional curing barns, Atlas Agri is encouraging its contracted farmers to build inexpensive, natural air-curing systems, known in southern Africa as a “Chigaffas.” Already used to cure burley in many countries, a Chigaffa is a simple, inexpensive wooden structure with racks to dry tobacco and a roof made out of plastic tarp or thatch. “We say to our farmers, if your curing barn is empty, reap straight into the curing barn,” says Kockott. “But if your curing barn is full, instead of waiting for the barn to be empty, by which time your tobacco in the field becomes overripe, reap on the day you are supposed to and put it in the Chigaffa.”

    The purpose of the Chigaffa is to alleviate pressure on the barn and prevent tobacco from sitting too long in the fields. “If you put overripe tobacco in the barn—by the time it is wilted and ready to fix color, it will have turned brown, so you have lost quality and yields,” says Kockott. Using a Chigaffa allows farmers to market tobacco that would otherwise be lost. Even if the Chigaffa leaf does not attract premium prices, the potential for additional volumes presents opportunity for additional income.

    While some have expressed concern that the Chigaffa system will bring lower quality tobaccos to market, Mackay notes that those styles are in line with prevailing customer preferences. “Global demand for value and super-value styles currently exceeds that for top quality tobacco,” he points out. Another advantage: Using the Chigaffa reduces the time spent in the traditional curing barn by a few days, lowering wood consumption, thus contributing to sustainability—a fact that should appeal to international customers, who expect their tobacco to be grown according to strict environmental, social and governance requirements.

    Convinced by the merits of natural air curing, the Tobacco Industry and Marketing Board endorsed the system earlier this year. “The introduction of this natural Virginia tobacco product is in line with the Tobacco Value Chain Transformation Plan,” the regulator wrote in a press note. “By producing more natural Virginia tobacco […] we believe the local tobacco industry will generate a wider range of qualities for customers on the global market, creating demand and encouraging investment for the ultimate longevity of the Zimbabwean tobacco industry.”

    Just by reducing post-harvest losses, a small farmer could increase his or her volume by up to a quarter, according to Atlas Agri. If the entire smallholder sector optimized its operations, it would go a long way toward achieving the 300 million kg proposed in the transformation plan. “Think about it,” says Mackay. “Smallholders produced approximately 200 million kg out of this year’s 260 million-plus kg crop. If they can add a quarter to what they already deliver, the country will be quite close to the desired 300 million kg—without claiming a single additional hectare of farmland or increasing pressure on our woodlands.”

    Even if the Chigaffa leaf does not attract premium prices, it still represents potential for additional income to the farmer.

    Beyond Tobacco

    In addition to boosting tobacco volumes, Atlas Agri is exploring complimentary crops, such as soya and cotton, to enhance farmer viability. Already, the company has provided its contracted growers with inputs for 700 hectares of soya. According to Mackay, diversification will not only improve farmers’ financial security but also rehabilitate their soils through better crop rotation. This in turn should ease the pressure from pests and disease, reducing the need for chemical crop protection agents, thereby creating a more sustainable product.

    Atlas Agri has made tremendous progress since its incorporation last year. “We are starting to reap the fruits of our heavy lifting,” says Mackay. “It’s incredibly gratifying when you see farmers smiling because you know you have exceeded expectations.” When the business hit its 20 million kg milestone in May 2023, the company’s by now shaggy crew broke out the champagne, along with the razors, and took advantage of a rare opportunity to unwind—but only momentarily because it’s time already to start thinking about the next crop.

    Like this season, the upcoming production cycle will throw up plenty of regulatory, environmental and competitive hurdles. If Atlas Agri’s first year of operation is any indication, however, the team members will overcome them with their trademark combination of passion, professionalism and persistence, ready to take each of the challenges on their freshly shaven chins.

    What a difference 20 million kg makes: Upon achieving their buying target, Atlas Agri’s team paid a well-deserved visit to the barber.

    Banjamin Edwards
    Brandon Palmer
    Craig Dollar
    Craig Bydawell
    Dylan Jones
    Ross Mackay
    Jordan Allatt
    Taco Tuinstra is Tobacco Reporter’s editorial director.Based in Raleigh, North Carolina, USA, he coordinates the work of staff writers and contributors.On his watch, Tobacco Reporter has won several awards for editorial excellence.Since joining the magazine in 1997, Taco has visited more than 75 countries to meet industry representatives in their markets and to report tobacco news firsthand.
  • Doctor’s Orders

    Doctor’s Orders

    Photo: Minerva Studio

    Medical licensing of e-cigarettes and nicotine pouches should be an urgent priority.

    By Derek Yach

    The alarm about the risks of products to health is usually first sounded by physicians. That was certainly the case with tobacco and health. The 1962 Royal College of Physicians (RCP) Report on Smoking as well as the 1964 Surgeon General’s (SG) Report on the same topic were led by physicians and drew upon the best epidemiological evidence available. The reports’ statement that “smoking kills” led to rapid changes in physicians’ smoking behavior well before regulators took up the challenge. The world had to wait eight years before the World Health Organization passed its first modest resolution on smoking. Only then did modest public health policies emerge.

    Internationally, the evidence is clear: No country experiences a serious decline in their smoking rates before it declines among physicians. And it takes about a decade before the population benefits start appearing. Globally, smoking rates among men approach 40 percent to 50 percent in countries as diverse as China, Bulgaria, Jordan and Bangladesh—or 50 years behind where the U.K. is today. Smoking rates among the physicians in these countries are about the same. There are few examples of physician-led reports like those of the RCP or SG from middle-income or lower middle-income countries. In such settings, we cannot expect to see substantial progress in ending smoking if we stick with the status quo.

    Physician Leadership Is Crucial for the Introduction of Innovative Interventions

    Innovations in healthcare are usually led by physicians armed with solid epidemiological and clinical data showing the benefits of new interventions for patients and the population. Physician leadership gives credibility to new products. The opposite is also true. Products that are not endorsed or approved by physicians rarely achieve population benefits and may face stiff regulatory approval.

    Sluggish Progress on Improving Cessation Outcomes

    For decades, physicians have followed a “medicalization” path to cessation, so it is not surprising that they have neglected tobacco harm reduction (THR) options. The basic advice given by physicians has changed little. Quit cold turkey, counseling, nicotine-replacement therapies (NRTs) and a few other pharmaceutical and behavioral services remain the mainstay of cessation. None have success rates that exceed 15 percent over the year, and most are associated with repeated relapses. The World Health Organization’s own reports to the World Health Assembly this year pointed to slow progress in addressing cessation. Numerous reports, such as those issued by the Foundation for a Smoke-Free World, have pointed to the failure of the pharmaceutical industry to bring better cessation tools to the market despite advances in behavioral and neuroscience that have led to new therapies for a range of diseases.

    It is long overdue that physicians have access to far more efficacious and effective ways of ending smoking. We now have a full range of feasible options that have been authorized by the U.S. Food and Drug Administration as “appropriate for the protection of public health”: heated-tobacco products, e-cigarettes, snus and most recently nicotine pouches. E-cigarettes and nicotine pouches are well placed to form the basis of a new approach to cessation and harm reduction.

    How Do We Engage Physicians in Scaling up Access to These Lifesaving Products?

    Recent experience shows that physicians have been resistant to these products for several reasons. They fear these are a new tactic by the tobacco industry to keep the next generation addicted. They seek data on long-term benefits. They are bamboozled daily by well-funded nonprofits and WHO messages about the dangers of these products for kids, and the impact of them on cancer or heart disease. The fact that none of this is based on science has not stopped the opposition.

    Could Medically Licensed Products Break Through and Reach Physicians?

    I strongly believe that they could.

    At a recent Keller and Heckman meeting, Ian Fearon, chief scientific officer at McKinney Scientific Advisors, described the “halo” effect of having medically licensed e-cigarettes on the market. To get medically licensed requires proof of quality, safety and efficacy. Once achieved, this could legitimize the category and open the doors to widespread physician acceptance of the products. The same could happen with nicotine pouches.

     This could start to erode distrust of these products by physicians as they use them and advise their patients to use them. The predictable positive outcomes would accelerate adoptions and use.

    Recall that almost 50 percent of male doctors in many low-income and middle-income countries and countries across the Middle East smoke. Helping them to switch first deserves concerted effort. And having a new medically licensed e-cigarette or nicotine pouch could well trigger the desired cascading impacts on their patients and then among the general population.

    The process to obtain a medical license has been well outlined by the FDA’s Center for Drug Evaluation and Research (CDER) and the U.K.’s Medicines and Healthcare products Regulatory Agency (MHRA). Neil Benowitz et al. (see below) and Fearon have stressed that CDER requirements are particularly onerous. The MHRA process is more “encouraging.” According to them, a major benefit of the MHRA is that studies required can be conducted in any country whereas only U.S. studies are accepted by the CDER.

    A unique authoring partnership between people who usually disagree about the value of THR concluded that the CDER should “reach out to companies that may be interested in developing smoking cessation products” and indicated that that could include medically approved vapes. Authors included Benowitz and Ken Warner, known supporters of THR, and Matt Myers and Joanne Cohen, who until now have opposed THR.

    They commented that “the deadliest form of nicotine delivery has been subject to limited oversight whereas products marketed to help people quit face far more regulatory barriers.” The fact that agreement can be reached on the value of THR in the context of medically licensed products should be taken as a signal to how broader acceptance might happen.

    Mitch Zeller, previous head of the FDA’s Center for Tobacco Products, jumped into this field recently and urged action on medical licensing when he announced that he had joined a company aiming to bring a medically licensable vape to market.

    Why Has Industry Not Led the Way?

    There can be little doubt that the pharmaceutical industry and leaders in the tobacco industry have long had the scientific knowledge and technical capabilities to develop medically licensed equivalents to e-cigarettes and nicotine pouches. So why has there been no progress? Are short-term commercial interests taking precedent over health needs? I suspect this is a major factor delaying progress by large companies. But thankfully, smaller entrepreneurial companies are pursuing medical licenses at considerable cost to them.

    In addition to commercial interests, industry leaders and analysts have mentioned three other issues as hampering to progress:

    1. Concern that the WHO and anti-harm reduction activists would mount campaigns against them.
    2. Tobacco companies fear that a medically licensed product would reach a small part of the market—people with early symptoms of disease or those deeply concerned about their health. That might turn off other smokers seeking to use safer products for recreation and pleasure. They do not want to be stigmatized as being “patients.”
    3. Any innovation or improvement to a medically licensed reduced-risk product needs costly, lengthy and comprehensive re-appraisals by the regulating body with no guarantee of consumer acceptance. For industries specializing in fast-moving consumer goods, this can be a deterrent.

    What Is the Size of the Market?

    Companies need to look at data on the burden of disease and at data they have showing that an extremely high percentage of e-cigarette users switched from combustibles for health reasons. Global burden of disease data shows that 8 million people die annually from tobacco use. That figure hides the fact that hundreds of millions of tobacco users have early symptoms or signs of cancers, heart and lung disease or tuberculosis. It hides the fact that over 50 percent of people with serious mental illness smoke, that about 60 percent to 70 percent of people with early chronic obstructive pulmonary disease, tuberculosis and schizophrenia smoke at the point they are diagnosed. And that figure does not change much during their treatment, suggesting physicians’ failure to help their patients end smoking.

    It is not surprising that a recent Bloomberg analysis suggests that the size of the nicotine-replacement market could reach $100 billion by 2028. That should stimulate companies to invest in medically licensed options that consumers demand and enjoy in unprecedent numbers.

    How Would These Products Be Marketed?

    Marketing strategies would need to distinguish between products that are medically approved versus others. There are many precedents for designing marketing plans to reach two different audiences using the same basic product. The most recent being how Ozempic addresses the needs of people with diabetes while Wegovy (both made by Novo Nordisk) addresses obesity. Two brands, one set of active ingredients. In an analogous way, initially NRTs were prescription-only in most countries but were changed to “over the counter” use to improve access to “essential medicine,” and NRTs are noted as such in the WHO Model List of Essential Medicines.

    I could see this developing a comparable way for e-cigarettes and nicotine pouches.

    Conclusion

    There is a massive untapped need to get more efficacious cessation products on the market. Medically licensed e-cigarettes and nicotine pouches could well be the key to gaining widespread and critically needed physician support for the categories. That could unblock deep opposition to THR as it has happened with so many innovations that benefit health.

    A global health expert and anti-smoking advocate for more than 30 years, Derek Yach is the owner of Global Health Strategies. Previously, Yach was the director of the Foundation for a Smoke-Free World and a World Health Organization cabinet director and executive director for noncommunicable diseases and mental health. He was deeply involved with the development of the Framework Convention on Tobacco Control.
  • The Heat is On

    The Heat is On

    Photo: lunx

    Competition in South Korea’s heated-tobacco products market is intensifying.

    By Stefanie Rossel

    When it comes to adoption of heated-tobacco products (HTPs), South Korean consumers are second only to their Japanese counterparts. Sales of HTPs have increased significantly since their introduction to the South Korean market in 2017, cannibalizing sales of traditional cigarettes. In 2023, the country’s HTP market is estimated to reach a value of KRW2.2 trillion ($913.39 million), up from KRW1.6 trillion in 2019 and KRW2 trillion in 2021, according to Euromonitor. By 2025, the business intelligence firm predicts that the Korean HTP market will be worth KRW2.4 trillion.

    While the number of tobacco products sold in South Korea rose by 1.1 percent from 3.59 billion packs of 20 cigarettes in 2020 to 3.63 billion packs in 2022, it was consumable sales of HTPs that drove the market. Their share increased from 380 million packs in 2020 to 540 million packs in 2022 whereas the sale of combustible cigarette packs dropped from 3.2 billion packs in 2020 to 3.09 billion in 2022, the country’s finance ministry stated in February.

    Demand for conventional cigarettes fell by 1.8 percent year-on-year while sales of HTPs rose by 21.3 percent. According to a survey by the Ministry of Finance, HTPs held a share of 14.8 percent of the total tobacco market in the first half of 2022. In 2023, the overall South Korean tobacco products market will be worth an estimated $9.2 billion, according to Statista. The country’s continuously declining smoking rate has been linked to the introduction of HTPs to the market. Smoking prevalence, which stood at 23.8 percent in 2015, dropped to 15.6 percent in 2021 and is expected to decrease by another 2.6 percent by 2026.

    Both traditional cigarettes and tobacco sticks for HTPs retail at roughly KRW4,500 per pack of 20 but are taxed slightly differently. Total tax per pack of 20 combustible cigarettes amounts to KRW3,223. For a pack of HTP consumables, it’s 90 percent of that, or KRW3,004, reflecting that the products are considered to be less harmful than traditional smokes. In April this year, South Korea’s ruling party suggested subjecting cigarettes and HTPs to the same tax rates amid a government drive to boost falling revenue, but the Ministry of Finance rejected the proposal. With a general election coming up in April 2024, the government is not expected to equalize the tax differential between the two categories in the near term.

    In January, KT&G CEO Baek Bok-in and PMI CEO Jacek Olczak turned their companies’ three-year cooperation agreement into a 15-year contract. While partnering internationally, PMI and KT&G compete fiercely for market share in South Korea. | Photo: KT&G

    Partners and Competitors

    South Korea’s HTP market is split among three players: Philip Morris International, KT&G and BAT. Recently, competition has been heating up in the category: PMI, which in 2017 introduced the first HTP (IQOS) in South Korea, remained the market leader until 2019, when IQOS sales declined from KRW800 billion in 2017 to KRW500 billion and KT&G overtook PMI with its Lil device. According to 2FIRSTS, Lil accounted for 48 percent of the market in May 2023 followed by IQOS with 42 percent and BAT’s Glo with 10 percent.

    In the past six months, all manufacturers have introduced new models of their HTP brands in Korea; they have also unleashed an aggressive price war.

    In November, KT&G launched Lil Aible, which is equipped with artificial intelligence technology that shows how long it takes to fully charge the device and preheat the consumable as well as how many times the user can puff with the remaining battery. On KT&G’s dedicated mobile app, users can check messages, phone notifications, the weather and calendar information. What sets the new model apart from other HTPs is its ability to use three different tobacco sticks with one device. Like its predecessor, Lil Aible features automatic heating, a self-cleaning system and a maximum of three consecutive uses.

    The product comes in two versions—an original version that retails at KRW110,000 and a premium version, which has an OLED touchscreen to make it easier for users to control diverse functions, at KRW200,000.

    To recapture its No. 1 position, PMI in February launched IQOS Iluma One, an economy version of its latest HTP device. The Iluma series works with a bladeless induction system and can only be used with dedicated heat sticks named Terea. The sticks are equipped with a metal heating element, a thin solid metal thread that is coated with stainless steel that heats the tobacco from within. A front plug at the end of the stick behind the tobacco element prevents tobacco residue, which means users do not need to clean the device.

    The company had been selling the more premium variants, Iluma and Iluma Prime, in major South Korean cities including Seoul and Busan since late 2022 and seized the opportunity of the Iluma One introduction for a nationwide rollout of all of its Iluma models. Iluma One is available at KRW69,000 whereas Iluma and Iluma Prime are sold for KRW99,000 and KRW139,000, respectively.

    In late November 2022, PMI had started manufacturing Terea consumables at its South Korean Yangsan plant, where the company has invested more than KRW300 billion in the production of noncombustible products since 2017.

    While battling for market share in South Korea, PMI and KT&G cooperate internationally. On Jan. 30, 2023, PMI and KT&G turned the three-year agreement they signed in 2020 into a 15-year contract. The agreement gives PMI exclusive access to KT&G’s smoke-free brands and innovation pipeline, including offerings for low-income and middle-income markets, and provides KT&G with continued access to PMI’s global commercial infrastructure and experience in commercializing smoke-free products. As a result of the collaboration, Lil, which PMI considers complementary to its existing portfolio of smoke-free products, is currently present in 31 countries in Central America, Europe and Central Asia.

    Fierce Price Battle

    Also in February, BAT launched Glo Hyper X2 in South Korea. After years of plodding along with a market share of 6 percent, the company increased its market share to 11.7 percent in 2022, according to The Korea Herald. Glo Hyper X2 is expected to further bolster the company’s position in South Korea. The all-in-one device, which features induction heating technology, faster heating and an LED indicator showing battery status, was introduced at a cut-rate price of KRW40,000. 

    In May, BAT cut prices of its HTPs in South Korea by half to expand its market share, according to 2FIRSTS.com. Glo Hyper X2 now retails at KRW19,000. According to the website, BAT Korea’s revenue in 2022 increased 14.3 percent compared to the previous year, but operating profits declined by 11.6 percent to KRW44.6 billion. Analysts fear that the low price strategy will cause BAT’s profitability to decline.

    BAT’s price reductions prompted KT&G to follow suit. The company began selling Lil Aible and Lil Aible Premium at a promotional price of KRW99,000 and KRW167,000, respectively. Analysts estimate that to maintain profit margins, the companies must sell their heating products for at least KRW30,000.

    Whether BAT’s strategy will work out remains to be seen. With an estimated 8 million smokers of combustible cigarettes, the South Korea market still holds a lot of potential for manufacturers of less hazardous alternatives.

    Stefanie Rossel is Tobacco Reporter’s editorial contributor. An experienced trade journalist, she combines sharp reporting skills with in-depth knowledge of the tobacco and vapor industries. Prior to joining Tobacco Reporter, Stefanie was editor-in-chief at Tobacco Journal International, where she worked for a decade. Fluent in English, German and French, Stefanie covers tobacco news around the world. She is based in Germany.
  • Stepping Up

    Stepping Up

    Zilong presented its Marskiss heat-not-burn product at TabExpo in Bologna.
    (Photo: Taco Tuinstra)

    Newcomer Marskiss aims to offer heated-tobacco consumers an improved user experience.

    By Stefanie Rossel

    Since their introduction to the market less than a decade ago, sales of heated-tobacco products (HTPs) have grown remarkably. Market research companies are outdoing each other in their forecasts for the category. Reportlinker, for example, valued the global HTP market at $22.36 billion in 2022 and expects it to reach $25.89 billion this year. The market is anticipated to increase at a compound annual growth rate of 15.9 percent to reach $72.86 billion by 2030. Euromonitor expects HTPs to cement their place at the head of the vapor growth category, with significant growth in Japan, South Korea, Russia, Italy, Germany, Poland, the U.S. and Ukraine.

    The global HTP market is dominated by four large players—Philip Morris International, which pioneered the category with its IQOS device; BAT, which competes with its Glo brand; Japan Tobacco International, known for its Ploom product; and KT&G with its Lil series.

    Inspired by the success in the segment of their larger counterparts, many smaller manufacturers have also entered the market. One of them is Singapore-based business Zilong. Driven by its desire to design a safe and good-flavored HTP, the company spent more than 10 years developing Marskiss before debuting the product in 2021 at the WT Middle East exhibition in Dubai and, more recently, showcasing it at TabExpo 2023 in Bologna.

    To understand how Marskiss differs from other HTPs, it’s helpful to examine the company’s background. Zilong was founded by Zhan Baoming, who has worked China’s tobacco industry since 1991 and also owns a cigarette flavoring company. Zhan has been in tobacco harm reduction since 2000. The knowledge he acquired about tar reduction and aroma enhancement laid a solid foundation for the creation of Zilong’s HTP product, according to Zhan. “My goal is to make a good HTP product that is low in tar while satisfying in tobacco aroma,” he says.

    One Marskiss stick provides users with the same level of satisfaction as two or three sticks of other HTP brands, according to Zilong. (Photo: Taco Tuinstra)

    Longer Lasting Aroma

    The nature and treatment of the tobacco makes all the difference, explains Zhan. “Our product uses high-quality natural tobacco as a carrier for our ‘aroma precursors,’ which is a featured technology of our product. At present, most HTP products on the market use food liquid fragrances to produce tobacco aroma. However, the resistance of food liquid fragrances to high temperature is weak, and the fragrances will be denatured and volatilized quickly with the increase of temperature, resulting in a shorter retention time of tobacco aroma. How to prolong the retention time of tobacco aroma? After years of research, our technical team found that natural tobacco and aromatic plants can be processed in a special procedure to obtain a comprehensive aroma, which produces fragrances of more lasting retention. This is what we call ‘the aroma precursor.’ The aroma precursor has much less impurity and more full-bodied, consistent and lasting tobacco flavor.”

    According to Zhan, Marskiss sticks feature more advanced moisturizing technology than other HTPs, which makes their aerosols purer and fresher. Among other benefits, this prevents users from experiencing a dry mouth, which is a common problem associated with HTPs. To keep the moisturized tobacco fresh, Zilong has developed a special stick construction that includes a storage chamber for the tobacco and a more efficient filtering technique.

    “The paper tube of our product has two layers—an outer layer and an inner layer—and we choose natural porous material as the inner layer coating to build a storage environment similar to a ceramic pot, which can capture the moisture from the tobacco section and keep it inside the tube so that the tobacco section will not become dry after the package has been opened for a period of time,” says Zhan.

    The patented chamber lets the tobacco age naturally with storage, according to Zilong, which will result in a better taste. What’s more, the filter section of each Marskiss stick features a ball array filtration system so that the aerosol passes through a curved path formed between the gap in the ball array. “After layer upon layer [of] filtration, the aerosol becomes fresher and purer,” explains Zhan.

    Marskiss sticks feature advanced moisturizing technology that keeps aerosols pure and fresh. Among other benefits, this prevents users from experiencing dry mouth. (Image: Zilong)

    More Satisfying

    Zilong claims its technology enables one Marskiss stick to provide users with the same level of satisfaction as two or three sticks of other HTP brands. By using lower, more balanced levels of nicotine salts, Marskiss also helps users avoid headaches associated with excessive nicotine salts.

    Marskiss tobacco sticks come in five flavors and are matched by a device with a pre-heating time of 20 seconds that allows for 18 puffs or five minutes of use, which is about four puffs more than other brands. Initially, Zilong intends to launch Marskiss with blade heating technology. Down the road, the device will also be available with pin heating technology. “It is light-weight, slim and slick, and portable, and more importantly, it is a perfect match with our stick product that can heat the sticks to give the best experiences to users,” says Zhan.

    In combination with the sticks’ patented filtering technology, the device reduces throat irritation and reduced dust to lungs, according to Zilong.

    The company has invested €15 million ($16.25 million) in Marskiss so far. In preparation for launch, Zilong has started identifying markets and partners. According to Zhan, the product has performed well in consumer trials. “We have done several rounds of consumer testing in different markets and basically, we get pretty positive feedback from users, including distinctive and lasting tobacco aroma, no bad smell in mouth and room so that people around them do not object them from using our product, and no headache or coughing after using,” he says.

    “We hope to tackle the pain points of the smokers, and we are committed to making the best [heat-not-burn] product,” says Zhan. “Please stay tuned for updates.”

    Stefanie Rossel is Tobacco Reporter’s editorial contributor. An experienced trade journalist, she combines sharp reporting skills with in-depth knowledge of the tobacco and vapor industries. Prior to joining Tobacco Reporter, Stefanie was editor-in-chief at Tobacco Journal International, where she worked for a decade. Fluent in English, German and French, Stefanie covers tobacco news around the world. She is based in Germany.
  • Why Don’t They Just Stop?

    Why Don’t They Just Stop?

    Photo: Wosunan

    Utopian visions and unintended consequences

    By Cheryl K. Olson

    “The decline in smoking prevalence has slowed to a trickle.” That’s how Kenneth Warner of the University of Michigan’s School of Public Health phrased it in a 2013 editorial on the tobacco endgame. With progress stalled, tobacco control advocates searched for dramatic measures to kick-start it. A Google Scholar search for “tobacco endgame” brings up over 7,000 results for the past decade.

    One popular idea is to simply declare game over. A 2018 editorial in Tobacco Control pointed to clever ads placed in U.K. newspapers by Philip Morris International saying, “We’re trying to give up cigarettes.” Rephrasing that slogan as “Stop me before I kill again,” the editorial stated, “There is no reason why a plan to phase out cigarette sales cannot be developed and pursued now.”

    The disruptions and isolation of the Covid-19 pandemic brought fresh calls in major medical and public health journals to stop marketing smokes. “In this context, now is an opportune time to move toward removing cigarettes from general retail sale,” said a BMJ editorial.

    If the tobacco industry is sincere about reducing harm, why don’t they just stop selling cigarettes? “That’s a very common talking point. It’s a nice utopian vision,” says Dave Dobbins, an independent consultant currently working with Altria and former chief operating officer of the Legacy Foundation/Truth Initiative.

    What would actually happen if Big Tobacco shut down cigarette sales tomorrow? And more realistically, what actions might speed the day when the last Marlboro or Salem is packaged and trucked? Experts in public health, economics and law enforcement have some thoughts.

    ‘In the Hands of Criminals’

    Dave Dobbins

    Cigarette sales could stop, but the desire to buy them wouldn’t. “All industries are a product of supply and demand,” says Dobbins. “And eliminating supply does not eliminate demand.” He pictured equipment idled by Big Tobacco being bought up and put to use by less-scrupulous entities.

    “If the tobacco companies stopped selling cigarettes, you would find an explosion in the black market and the counterfeit market,” says Richard Marianos, retired assistant director at the U.S. Bureau of Alcohol, Tobacco, Firearms and Explosives and faculty member at Georgetown University. “They would be smuggled into the United States and supplant that demand that has been voided by the tobacco companies.”

    Halting sales of cigarettes would have unintended consequences. Currently, tobacco companies are regulated and taxed, and their products are distributed in legal commerce.

    “By taking them out of commerce, you put the market in the hands of criminals who will sell on the street and create additional crime,” says Marianos.

    We see an analogous situation unfolding with the regulation of vaping. After the U.S. Food and Drug Administration prioritized enforcement against mint and fruit-flavored prefilled cartridges in January 2020, youth sales of disposable flavored brands soared. On June 22, the FDA announced a “nationwide retailer inspection blitz” that led to warning letters cracking down on the disposable brands Elf Bar and Esco Bars.

    “There’s vaping out there that is designed for a tobacco harm reduction strategy, which is good, to get people off combustibles,” Marianos says. “But these disposable vapes with flavors like bubblegum and gummy bear, marketed to kids, made by unregulated factories in China, need to be put away.”

    Marianos also points to an additional public health risk from counterfeit or contraband overseas products: “A lot of them are made in facilities that contain rat feces and dirty machines.”

    A report in the June 23 issue of the CDC’s Morbidity and Mortality Weekly Report noted an increase in e-cigarette associated cases reported to U.S. poison centers. Sixty percent involved Elf Bar, and more than 90 percent of those were among children younger than five.

    Prohibition Lessons

    “It’s just not clear that there are methods that are both plausible and coercive enough to enforce a prohibition if people really want drugs,” says Dobbins. “The drug wars in every other field have been an utter failure. I don’t think there’s a lot of hope that there’d be a different result if you declared a drug war on nicotine.”

    The U.S. experience with alcohol Prohibition in the early 20th century is enlightening. Entertaining examples of law evasion can be found on the website for the Ken Burns public television documentary about this failed experiment. Grape juice concentrate was sold with sly warnings not to leave it sitting too long, lest it ferment into wine. Home distilling equipment could be bought at hardware stores, and instructions on making booze could be found at the library. In short, “The law that was meant to stop Americans from drinking was instead turning many of them into experts on how to make it.” And the problem of alcohol abuse, far from being solved by Prohibition, was made worse.

    “It’s hard for me to imagine the kind of coercive measures a state would have to employ to curtail supply, much less demand,” Dobbins says. “In countries that essentially eliminated marketing and imposed plain labeling or graphic depictions of the death and disease that can occur from cigarette use, those efforts have only very mildly curtailed demand.”

    During the Covid-19 pandemic, South Africa enacted a temporary ban for the public good. Research showed that people who smoked were at higher risk for severe illness; this could buckle the healthcare system. Unfortunately, the usual happened: Less than 10 percent of smokers quit. The existing black market ramped up production. Prices increased over 240 percent. When the ban ended, the illicit sellers had a larger share than before. (For other examples, see “Prohibitionists at Work” on Clive Bates’s The Counterfactual website.)

    Harm Maintenance?

    In 2013, Warner noted the lack of consensus on what the “end of the endgame” might look like for tobacco control. The end of smoking? Of all forms of tobacco use? A nicotine-free population? Or “a more modest tobacco harm minimization objective”?

    In that 2018 Tobacco Control editorial,  Ruth Malone wrote, “So we should all be clear about one thing: ‘Giving up cigarettes’ for PMI does not mean the company wants people to quit using its addiction sticks. It means they want to get people hooked on a different type of addiction stick.”

    Harm minimization looked like a profit-maintenance ploy to skeptics in public health. They felt burned by “light” cigarettes and saw poor adoption of the available nicotine replacement options. As John P. Pierce wrote in Nicotine & Tobacco Research in 2002, “Without more research on whether these products can be substituted effectively for smoking, endorsing harm reduction as a goal could lead to another 25 years of harm maintenance.”

    How different things look 21 years later! Novel nicotine alternatives abound. We have data that many people who smoke, including those from vulnerable groups, are indeed willing to substitute these products. Anti-smoking eminences such as Warner now advocate for “nicotine e-cigarettes as a tool for smoking cessation.”

    For public health people, it’s hard to let go of the desire to punish Big Tobacco for real and serious past harms. But we can’t wish away the accumulating data. Evidence suggests that helping multinational cigarette makers transform into diversified sellers of noncombustible nicotine products will save more lives with fewer unintended effects. Ditto for helping people who can’t or don’t want to quit smoking switch to satisfying lower risk options.

    ‘Novelty Items’

    Michael Pesko

    Michael Pesko, an associate professor at Georgia State University who studies nicotine policy, gave me the economist perspective. “How do we intervene in a marketplace determined by supply and demand to reduce purchases of combustible tobacco products? No intervention will fully stamp out combustibles, but it may be possible to reduce their use to novelty items,” he says.

    He recommends a combination of education and risk-based regulation. “Raising public health awareness about the dangers of combustibles and the harm reduction benefits of reduced-risk tobacco products such as e-cigarettes is a way to reduce demand for combustible tobacco products,” he says. “Heavy regulation of combustibles, such as taxing them, can be used to reduce supply.”

    A new article by eight prominent academics and lawyers titled Do Tobacco Companies Have an Incentive to Promote “Harm Reduction” Products? says, yes, they do—provided there is competition from noncigarette companies and appropriate government regulation.

    The authors mention multiple ways that tobacco control researchers can add sunshine to speed this transition. This ranges from analyzing the effects of government regulations on competition and the market position of noncombustibles versus cigarettes to monitoring and exposing smoking promoting or alternative discouraging activities by tobacco companies.

    Cheryl K. Olson is a California-based public health researcher who specializes in behavioral health issues and consults on tobacco product behaviors via McKinney Regulatory Science Advisors. She spent 15 years on the faculty of Harvard Medical School.
  • A Mixed Bag

    A Mixed Bag

    Image: Taco Tuinstra

    Growers continue to struggle with rising production cost, but demand for tobacco remains firm.

    By Stefanie Rossel

    Ivan Genov

    Challenges abound for the global leaf sector, but there are also opportunities for tobacco farmers, Ivan Genov, manager of tobacco industry analysis at the International Tobacco Growers Association (ITGA), told participants in the organization’s recent regional meeting in Salta, Argentina.

    The ITGA recently completed a survey among growers and other stakeholders. “The rising cost of production was consistently put as the primary economic concern in the Americas, Africa, Asia, Europe as well as the Middle East regions,” Genov told Tobacco Reporter. “This dynamic is accelerating and has been particularly worrying in the last two to three marketing seasons. The situation is made worse by other underlying factors, including inflation, price rises of key commodities and growing international tensions, making even more challenging the navigation in global supply chains. All these factors contribute to bringing up the general costs of living and create a natural obstacle in tobacco production.”

    In Brazil, for example, the cost of production increased by more than 30 percent on an annual basis; in Zimbabwe, it was more than 20 percent. In most of the leading tobacco producing and exporting countries, the cost of production has been growing at double-digit figures, according to Genov.

    In addition, Russia’s invasion of Ukraine has impacted the availability and pricing of fertilizers. “The war in Ukraine, along with the massive humanitarian disaster, is also highly problematic in the wider agricultural aspect,” said Genov. “A lot of African and lower income markets are highly dependent on agrifood commodities imported from Russia and Ukraine; wheat was highlighted by the United Nations in the beginning of the conflict. The war has created a shortage of fertilizers as well as a spike in pricing as alternative production routes have to be exploited—often much farther away. This adds to the rising costs of production.”

    Worsening U.S.-China relations, meanwhile, could result in more trade barriers for leaf tobacco and other commodities. Inflation pressures, meanwhile, have added to the general expectation of a prolonged period of crisis. There is consensus that cigarette consumption has peaked and is now declining in line with tobacco in the long term. Novel alternatives such as heated-tobacco products contain less tobacco per stick than traditional cigarettes, whereas e-cigarettes require no tobacco at all. The EU Supply Chain Due Diligence Act will bring about more requirements in each step of the production process.

    All tobacco origins suffered from significantly increased cost of production. | Photo: Tobacco Reporter archive

    Resilient Farmers

    Despite these challenges, there are still opportunities for tobacco growers, the survey showed. Since late 2020, leaf has been in undersupply worldwide—an issue that is openly discussed by leaf merchants and international manufacturers. “Some of them have the lowest uncommitted inventories in their recent histories,” said Genov. “The case around burley is particularly relevant. For example, the 2022 crop in Malawi—one of the key markets for the variety—was very short. As a result, we believe it is natural to expect growth in pricing that goes above the cost of production increases [see “Back to Normal,” Tobacco Reporter, June 2023]. The alternative is to see further drops in the global tobacco growers base as cultivating the crop will become even more challenging. We have to remember that this happens on top of issues with generational continuation and the move away from rural areas by young people.”

    Stable producers who are well prepared for the underlying threats will enjoy demand for their products, according to Genov. “A lot of tobacco growers have been in the business for several generations,” he said. “A great number of them have a well-diversified land, stable channels and partners for their inputs and huge experience in planning. In the face of leaf shortage and high demand, this surely means quality production is very likely to be realized. Unfortunately, in some cases, diversification is not as easy. It is not only about time and financing but the opportunities of the market. In certain countries, tobacco is the best bet. Small-scale farmers are often left with the least support; they do not have the capacity and time to safeguard against all threats. This is why support from all stakeholders in the sector is essential. Small-scale farmers must not be treated as suppliers of low-price production only.”

    Most tobacco farmers are exceptionally resilient, Genov stated. “They have worked in a regulations-heavy environment for decades. Nevertheless, it is still essential to receive support and real understanding from local and international authorities and to be included in the conversations that decide their futures. In addition, tobacco growers’ needs are often not dissimilar to those farmers caring about other field crops.”

    Support Needed

    According to Genov, one way to assist growers is through diversification efforts, especially in the markets that are heavily dependent on tobacco. Unfortunately, he said, the World Health Organization’s Framework Convention on Tobacco Control (FCTC) Article 17, which urges member states to find viable alternatives for tobacco growers, has delivered few tangible results on this front. ITGA has put Article 17 at the center of its efforts in 2023 to ensure that the issue is taken seriously during the Conference of the Parties to the FCTC in Panama later this year. The organization urges stakeholders to remember that the livelihoods of millions of people depend on tobacco growers.

    Tobacco growing countries will also need assistance with issues such as deforestation, which has been a big problem, especially in Africa. “Finding and financing alternative fuel sources that are more environmentally sustainable is critical,” said Genov. “There are some projects being run in this area. Last November, ITGA organized an awareness bringing campaign about deforestation in three of the leading tobacco growing regions in Zimbabwe. We are pressing ahead with expanding the project to other regions by the end of the year.”

    One of the areas that should be prioritized is water management, according to the results of the ITGA’s survey. “For example, in Brazil, one of the key international leaf markets, there is low water storage capacity,” said Genov. “Water conservation is going to climb on the agenda in the years to come. If we include the urgent social issues that are often faced by tobacco growers, like poverty, lack of opportunity for the youth, child labor and inadequate healthcare, we can see that the sector still needs a lot of attention.”

    Increasingly, tobacco growers have to cope with the consequences of climate change, which makes it harder to plan agricultural activities. “This makes services like insurance and the importance of forward planning even more significant,” Genov stressed. While weather variations can always be expected, there were some abnormal events in the last few seasons: “In 2022, Malawi was hit by Cyclones Gombe and Anna while Cyclone Mandous affected the crop in Andhra Pradesh in India. In the Americas, certain origins, like in the Dominican Republic, report changes in the traditional rainy season while in Europe, there were periods of prolonged drought. In Cuba, arguably the most striking example, Hurricane Ian obliterated the crop used to produce premium cigars.”

    Cost of Production

    In his presentation, Genov also reviewed global leaf production, citing data from Universal Leaf. Driven by increases in the U.S., Brazil and Zimbabwe, flue-cured Virginia (FCV) rebounded slightly, to 1.73 billion kg, in 2021. In 2022, the FCV crop excluding China was again short, down to 1.64 billion kg. Brazil’s season, for instance, finished last year with 60 million kg less than in 2021. For 2023, leading markets are expected to increase production, which could lead to increased supply at the global level, Genov said.

    In Zimbabwe, production fell by 3 percent in 2022 to just over 200 million kg but was still higher than expected due to drought and the late rains improving the crop. The cost of production rose faster than tobacco prices, however, and is likely to continue increasing next year. “Farmers’ viability over the last two years has been significantly reduced,” said Genov. “In future, pricing will remain a crucial element in seeing which farmers stick with tobacco and which will move entirely to other crops. It is interesting to note here that Zimbabwe’s government has an ambitious target to stimulate production to 300 million kg by 2025 [see Tobacco Reporter’s special report on the Tobacco Value Chain Transformation Plan in May 2023]. Given the current progress of the market, this seems highly unlikely.”

    In the U.S., production cost put severe pressure on growers who are increasingly turning to other commodities. “Labor, energy and fertilizer cost will flag this particularly,” said Genov. “2022 has been said to be the most expensive crop to be grown in U.S. history.” For 2023, U.S. producers expect increasing demand with no relief in cost of production, Genov said, and it appears that China is back on the market.

    In China, meanwhile, tobacco production has been growing exponentially. The FCV crop reached an estimated 1.91 billion kg in 2022 and is expected to increase to 2 billion kg this year. Tobacco imports overcame their Covid-related drop of 2020 in 2021, according to Genov, who expects demand to remain strong based on local consumption patterns.

    Burley production decreased from 407 million kg in 2021 to 360 million kg in 2022. The crop is anticipated to bounce back to 460 million kg in 2023.

    Oriental production dropped from 154 million kg in 2020 to 119 million kg in 2021 and stagnated in 2022 at 117 million kg. Production of dark air-cured slightly increased from 108 million kg in 2021 to 113 million kg one year on. For the two latter crops, there is no estimate for 2023 yet.

    Stefanie Rossel is Tobacco Reporter’s editorial contributor. An experienced trade journalist, she combines sharp reporting skills with in-depth knowledge of the tobacco and vapor industries. Prior to joining Tobacco Reporter, Stefanie was editor-in-chief at Tobacco Journal International, where she worked for a decade. Fluent in English, German and French, Stefanie covers tobacco news around the world. She is based in Germany.
  • Best Practices

    Best Practices

    Photo: doidam10

    How to approach environmental assessments for the best chance of success

    By Adam Bonin and Antony Jones

    An Environmental Assessment (EA) is an analysis prepared in accordance with the U.S. National Environmental Policy Act (NEPA) to determine if a product’s approval would significantly affect the environment. It applies to all federal actions in the U.S., including regulations, policies, projects, licensing and permission granting. The assessments give insights into potential risks associated with a product’s manufacture, use and disposal and help manufacturers develop effective mitigation strategies to reduce or avoid possible environmental consequences.

    EAs therefore help regulatory agencies identify potential adverse environmental impacts from the manufacture, use and disposal of electronic nicotine-delivery systems and oral nicotine products. They are a small yet important part of premarket tobacco product applications (PMTAs) and modified-risk tobacco product submissions. The U.S. Food and Drug Administration requires manufacturers to submit EAs for each individual tobacco product, or stock-keeping unit, within a PMTA.

    An inadequate or absent EA will result in either a “refuse-to-accept” or a “refuse-to-file” order from the FDA. In 2021, the FDA rejected 4.5 million vaping applications on the grounds that they “lacked an adequate environmental assessment.” With companies spending millions on PMTA submissions, they cannot afford to miss out on approval due to such a small part of the process. So, what does a good EA look like?

    What to Include in an Environmental Assessment

    In general, an EA includes an executive summary, applicant details, description of the proposed action and purpose and need of the proposed action. Further EA sections include the identification of alternatives, including the proposed action and no action alternative, potential environmental impacts of the alternatives (affected environment [or existing conditions] and environmental impacts), cumulative impacts and mitigation measures. An EA is appropriate for submission if it is determined that the impacts of the proposal will not be significant or the FDA concludes a finding of no significant impact. Mitigation measures may be recommended if impacts are anticipated, to reduce them below the significance threshold.

    The initial stage of the EA process is building a well-defined project description, covering the purpose and need for the regulatory decision (marketing granted order) that triggers the requirement for an EA under the NEPA. The applicant will also need to include details of product components, product formulation (where applicable) and predicted sales projections for the first and fifth years. It is particularly important to include the mass of individual metals in product hardware components (e.g., devices, pods) to assess potential impacts at the end of life.

    A good EA includes a thorough screening and comprehensive modeling of product components (e.g., e-liquid ingredients), with all conclusions and results backed up with hard data. The evaluation of the potential release of materials to the environment should be quantitively assessed, with the resulting potential concentrations in the environment explicitly stated and compared with relevant ecotoxicity standards to determine the possible impact.

    Throughout, it is important to appropriately manage confidential information. EAs include both confidential and nonconfidential appendices, and it is important that these are prepared correctly. For example, if there is proprietary information in the e-liquid formulation, this would be best listed in the confidential appendices, as would sales and marketing projections. It can be difficult to know which information is appropriate for inclusion in the confidential apprentices, and working with an experienced team offers the best chance of success.

    Determining the Possible Impacts

    E-liquids typically consist of a mixture of ingredients, including propylene glycol, vegetable glycerin and nicotine. The formulation can be screened using a predictive tool to determine which ingredients are of most ecotoxicological concern and should be carried forward into the analysis. The selected ingredients can be assessed for estimated acute and chronic aquatic toxicity for aquatic organisms, including plants, fish and invertebrates, and then be assessed in subsequent fate and transport modeling.

    The EA should analyze the plausible scenarios for the impact of the identified substances being released into the environment, including quantitative release modeling. For example, this could include the possible impact of the material being released into surface water or soils at quantities considered reasonable based on predicted sales data.

    The project supply chain should also be documented, including details of manufacturing and shipping to retail entities. The environmental and social resources around U.S. manufacturing facilities require characterization to provide an understanding of the affected environment (existing or baseline conditions). The potential impacts of projects can then be evaluated based on changes to the baseline conditions—for example, if chemical mixtures or raw ingredients are accidentally released into surface water or chemicals are released down the drain during manufacturing.

    It is important that the EA is realistic. In our experience, the inclusion of conservative analyses appears to be the soundest approach. It may be tempting to conduct modeling for a wide variety of release scenarios, but if they are deemed unlikely by the FDA, you may receive a deficiency for evaluating unreasonable scenarios.

    Tips and Tricks

    • Start early. Considering the EA process early in the application can improve efficiencies, particularly for characterizing natural resources around U.S.-based facilities and engaging with manufacturers and other vendors to understand product supply chains.
    • Use a robust standard operating procedure. In an EA, it is vital that every section includes explicit information that satisfactorily evaluates the product against FDA requirements.
    • Choose an experienced team. Many businesses do not have employees with sufficient NEPA experience; in this case, we recommend working with a consultancy. NEPA-specific jargon and other regulatory nuances can be challenging for new practitioners.
    • Stay up to date. Attending FDA and NEPA meetings can be a great way to stay up to date with any changes in the guidance. In addition, manufacturers can engage directly with an FDA project manager if they receive deficiency comments.
    Adam Bonin is a senior consultant at Broughton with over 22 years of scientific consulting experience. He earned a Bachelor of Science degree in environmental management from the University of Rhode Island and a doctorate in environmental microbiology from Portland State University. Bonin also completed a postdoctoral appointment in microbial ecology at Oregon Health and Science University.
    Antony Jones is a managing consultant at Broughton with more than 22 years of experience in risk assessment with a focus on characterizing and reducing risks across the pharmaceutical, biotechnology, food, nicotine and environmental industries. He earned a Bachelor of Science degree in biology from the University of York and a doctorate in molecular biology and microbiology from Newcastle University. Jones also completed a postdoctoral appointment at King’s College London.

    Broughton is a global scientific consultancy-based Contract Research Organization serving industries in pharmaceuticals, next-generation nicotine-delivery products and cannabinoids. Its team has developed a robust and proven approach for preparing defensible NEPA-compliant EAs for the FDA PMTA. For more information, visit www.broughton-group.com/us-pmta-and-mrtp-nepa-environmental-assessments-ea.

  • Broadening the Base

    Broadening the Base

    Photos: Taco Tuinstra

    Malawi seeks to reduce its heavy dependence on tobacco.

    By Taco Tuinstra

    The impacts of Malawi’s balance-of-trade crisis were visible in late March even to an infrequent Western visitor who could afford to stay at an upscale hotel. Certain items on the room service menu were consistently out of stock, for example, while getting around Lilongwe required queuing for gasoline and hoping the petrol station would not run dry before the driver reached the pump.

    Because Malawi imports more goods and services than it exports, it suffers a chronic shortage of hard currency. In 2020, the latest year for which figures are available, the country’s import bill was $2.8 billion, versus exports of only $800 million, according to the National Statistics Office. With not enough U.S. dollars to pay for imports, many foreign-made goods were simply unavailable.

    For Malawi’s well-heeled international guests, the shortages represent mere inconveniences. Upon return to their home countries, they will be able to generously make up for the missed food items and travel without worrying about fuel. For the average Malawian, however, the trade deficit represents a real problem. Among other things, the dearth of foreign currency prevented the nation from importing enough fertilizer for its Maize and other crops this year, spelling trouble for food security and social cohesion. While Malawi was peaceful during Tobacco Reporter’s visit in late March, some feared civil unrest. “It’s coming,” warned an industry veteran.

    Visit the countryside in April/May, and you will see how people’s lives change when the tobacco markets open. If the markets fail, however, there will be poverty in the villages.

    Nixon Lita, CEO, TAMA Farmer’s Trust

    One cause of Malawi’s economic problems is the fact that it relies too heavily on a single commodity. Tobacco accounts for between 12 percent and 15 percent of Malawi’s gross domestic product and between 40 percent and 70 percent of export earnings, depending on who you ask and on the season. Cultivation alone employs nearly half a million people, according to the Tobacco Commission, which regulates the trade. Those figures make Malawi the world’s most tobacco-dependent country.

    They also leave Malawi vulnerable to factors outside its control, including climate change and global cigarette sales. “Visit the countryside in April/May, and you will see how people’s lives change when the tobacco markets open,” says Nixon Lita, CEO of the TAMA Farmers Trust, describing the influx of cash at the start of each selling season. “If the markets fail, however, there will be poverty in the villages.”

    Last year is a case in point. Due to unfavorable climate conditions during the growing season, Malawi produced only 85.09 million kg of tobacco in 2022—the lowest volume in a decade, according to the Tobacco Commission. Despite higher per-kilo prices than in 2021, farmers earned just $182.12 million from their leaf sales last year. The reduced inflow of foreign currency in 2022 has left Malawi struggling even harder than usual to import essential items. The money made from this season’s larger crop (see “Back to Normal”) is unlikely to make up for the shortfall.

    Malawi’s overreliance on tobacco will become an even greater problem as global cigarette consumption stagnates. Already, the country’s leaf sales are down considerably from only a few years ago. Between 2016 and 2021, tobacco exports in real terms dropped by 42 percent, according to the World Bank. While local merchants are confident that Malawian burley—the country’s predominant tobacco variety—will continue to find buyers in the near future (see “Enduring Demand“), they are acutely aware that the industry should start preparing for a future with less tobacco, especially as the World Health Organization Framework Convention on Tobacco Control measures to discourage cigarette consumption start to bite.

    Malawi tobacco growers benefit from structured markets, which give them access to customers worldwide. Such infrastructure does not exist for many of the country’s other commodities. The video shows leaf being auctioned at the Lilongwe sales floors.

    Spreading the Risk

    To broaden Malawi’s economic base, stakeholders have stepped up efforts to develop other sectors. The TAMA Farmers Trust, for example, expanded its mandate in 2019. Originally established to represent only tobacco farmers, the organization is now helping its members produce other crops as well. Tobacco merchants such as Limbe Leaf Tobacco Co. (LLTC) and Alliance One Tobacco Malawi (AOTM), too, are encouraging diversification. Leveraging their existing farmer-support structures, they are now also disseminating inputs and agronomic advice for nontobacco crops to their contracted growers.

    Another big push comes from the Foundation for a Smoke-Free World (FSFW), which is an independent U.S. nonprofit organization that is funded by annual gifts from PMI Global Services. Established to “end smoking in this generation,” the FSFW focuses its grantmaking and charitable activities in three categories: health and science research aimed at helping smokers quit or switch to less harmful products, industry transformation and agricultural diversification.

    We should not make the same mistake as with tobacco by developing just one value chain.

    Candida Nakhumwa, vice president and Malawi country director, Foundation for a Smoke-Free World

    The foundation’s agricultural diversification objectives include ensuring that smallholder farmers in Malawi impacted by the declining demand for tobacco are supported to find sustainable alternative livelihoods. To advance these objectives, the FSFW has made grants to set up two institutions—the Centre for Agricultural Transformation (CAT), a science, business and technology incubation hub, and the MwAPATA Institute, an independent agricultural policy think tank that conducts research to inform and improve agricultural-related policies.

    Candida Nakhumwa, FSFW vice president and country director in Malawi, stresses the importance of developing multiple value chains simultaneously. “We should not make the same mistake as with tobacco by developing just one,” she says. In selecting alternative commodities, Nakhumwa urges Malawi to prioritize both exports and import substitution. “We are spending precious foreign exchange on importing things that we should be producing domestically,” she says. “For example, we can make cooking oil from soya beans or sunflower and use that as an import substitute.” Soya beans and sunflower, along with traditional Malawi crops such as groundnuts, also enjoy growing demand internationally, representing export potential.

    For crops like soya bean, sunflower and bananas to succeed, Malawi will need to replicate some of the factors that have allowed tobacco to thrive, notably infrastructure and a deliberate focus on productivity

    Building Markets

    For crops like soya bean, sunflower and groundnuts to succeed, however, Malawi will need to replicate some of the factors that have allowed tobacco to thrive, notably infrastructure and a deliberate focus on productivity. Over the years, the Malawi government gave lots of support to tobacco at the expense of other crops that also had potential, according to Nakhumwa. As a result, the markets for those other value chains remain underdeveloped.

    “The fact that tobacco has a structured market in Malawi, with auction floors and contracting companies, means that leaf growers have access to buyers worldwide—something that is not necessarily the case for producers of other crops,” says Nakhumwa. Without a structured market, producers of nontobacco crops will simply be trading in Malawi kwacha instead of earning hard currency on the global market.

    A structured market also gives confidence to financiers. “Tobacco farmers are not paid in cash; they receive their payments through the bank—so the lenders know they will recover whatever they loaned to the farmer,” says Nakhumwa. Access to finance in turn means access to agricultural inputs, including inorganic fertilizers, which are imported.

    In addition, tobacco has benefited from research and agronomic advice, both through the leaf merchants and the government’s Agricultural Research and Extension Service Trust. Such services have historically been provided at much lower levels to other crops, although this is starting to change as stakeholders adjust to evolving market conditions.

    Due to suboptimal agricultural practices, nontobacco farmers in Malawi are producing at only 30 percent to 40 percent of their potential, according to Nakhumwa. The country’s soils suffer from high acidity and low nutrient levels. These can be fixed using both organic and inorganic fertilizers. However, with commercial banks charging interest rates of 20 percent to 30 percent, tools to improve the soil, such as agricultural lime and inorganic fertilizer, remain out of reach for many smallholder farmers.

    Low productivity means that even though there is demand for Malawi’s nontobacco crops, the country is in many cases unable to satisfy it sustainably. “When a customer in South Africa signs a forward contract, he will want assurance that the goods are going to be delivered consistently,” says Nakhumwa. “If we can supply for only two months and then run dry, we are no longer an attractive supplier for them. The customers may in that case prefer to deal with a seller in Brazil or elsewhere who can guarantee supply.” This is why the FSFW is focusing on enhancing productivity at the farmer level and creating new markets through the CAT.

    At a demonstration farm on the outskirts of Lilongwe the CAT offers a platform for private sector partners to showcase technologies to help farmers optimize their operations.

    Strengthening Skills, Raising Productivity and Creating New Markets

    The CAT aims to boost agricultural productivity through science, technology and innovation while helping innovators turn their ideas into sustainable agribusinesses to create new markets for the alternative commodities produced by smallholders. At a demonstration farm on the outskirts of Lilongwe, the organization offers a platform for a wide range of private sector partners to showcase technologies to help farmers optimize their operations.

    Alongside technologies such as irrigation and ground sensors, the farm features different varieties of maize, groundnut, soya beans, rice and sunflower, among other crops. It also works with agronomists to transfer knowledge: What happens if you plant 10 cm apart or practice double-row planting? What happens if you tweak the amount of fertilizer? According to CAT Executive Director Macleod Nkhoma, such demonstration plots are an effective way to disseminate information to smallholder farmers and promote the adoption of technology, especially in a country with low literacy rates like Malawi.

    In addition to its work on the farm, the CAT helps agricultural entrepreneurs with skills that enable them to access finance and grow their agribusinesses while providing markets to smallholder farmers. “Banks tend to be wary of unstructured markets,” says Macleod. “They view those value chains as very risky.” By supporting the development of these agribusinesses, the CAT helps them to become bankable.

    Already, the center has supported several agricultural ventures, including a project by Hortinet that seeks to reinvigorate Malawi’s dormant banana business through tissue culture (see “From Imports to Orchards”) and an initiative by JAT Investments, which aims to replace the button mushrooms that are currently imported into Malawi with domestically cultivated varieties (see “Fungi Fever“).

    The CAT is helping Hortinet to expand its farmer base from 200 to 700 contracted growers. “Without CAT’s support, we would not have had the capacity to supply that many growers with our banana plantlets,” says Hortinet Executive Director Frank Washoni. JAT Investments benefited from CAT assistance in procuring seeds (spawn) and infrastructure in support of mushroom production. “The CAT helped us procure seed, infrastructure and training, allowing us to grow our growers’ network from two to seven farmers club.” says JAT Investments Operations Director Temwani Gunda. “It we had to work on our own, it would have taken much longer.”

    In terms of weight, Alliance One Tobacco Malawi’s contracted farmers already produce four times more food than tobacco.

    Simon Peverelle, managing director, AOTM

    The Tone at the Top

    To live up to their potential, the nontobacco crops will also need better policy frameworks. According to MwAPATA Executive Director William Chadza, export bans and foreign exchange quota currently disincentivize production. “Farmers are often unable to access hard currency to import agricultural inputs in time for the growing season,” he says. In addition, some government market interventions, frequent policy reversals and the unpredictable business environment limit private investments in the agricultural sector. Contradictory policies relating to land and crops present a hurdle as well, according to Chadza.

    Encouragingly, Malawi’s leadership increasingly appreciates the need to broaden Malawi’s economic base. Whereas the government in the past may have been reluctant to acknowledge the changing situation on the global tobacco market, it now appears more cognizant of the new realities. At the opening of the 2022 marketing tobacco season, Malawi President Lazarus Chakwera openly called for a diversification strategy. “The tone at the top is important,” says Nakhumwa. “If the leaders cannot acknowledge that there is a problem and we need to pivot, stakeholders will not rally behind you.”

    Perhaps surprisingly to some, diversification has also been embraced by the tobacco industry. LLTC is supporting growers with certified food crop seeds grown on company farms in the Kasungu district while researching and developing other food crops for exports. It has collaborated with Feed the Future USAID and will be rolling out low-tech irrigation systems to boost productivity. AOTM has made a big bet on groundnuts (see “A Gamble on Goobers”), helping its contracted farmers increase yields and quality with improved varieties, farming equipment and agronomic advice. In March 2022, the company opened a groundnut processing facility in Lilongwe with the capacity to process 50,000 tons per year.

    It took us more than 50 years to develop the tobacco industry to where it is now,” he says. “There is no way other crops will all of a sudden replace tobacco.

    Joseph Malunga, CEO, Tobacco Commission

    The merchants’ investments in productivity, meanwhile, have enabled tobacco farmers to double their yields, allowing them to produce the same volumes of leaf on fewer hectares and release land for food and other cash crops. Tobacco industry leaders see no contradiction between their support for nontobacco crops and their primary business, arguing that farmer livelihood sustainability is in their interest. “Diversification makes sense,” says Simon Peverelle, managing director of AOTM. In terms of weight, he points out, the company’s contracted farmers already produce four times more food than tobacco.

    But even with government and industry behind diversification, it will take time for Malawi to overcome its heavy reliance on tobacco. Tobacco Commission CEO Joseph Malunga believes the golden leaf will remain a major crop in Malawi for years to come. “It took us more than 50 years to develop the tobacco industry to where it is now,” he says. “There is no way other crops will all of a sudden replace tobacco.”

    Nonetheless, Malunga acknowledges that Malawi needs to spread its eggs over more than one basket. “It is dangerous for us as a country to rely on one thing because if something goes wrong, you are definitely in trouble,” he says. Rather than looking for commodities to replace tobacco, however, Malunga urges Malawi to promote crops that work alongside it, just like the leaf merchants have been integrating food crops into their tobacco operations.

    Malawi has a long way to go, but through the combination of government, industry and nonprofit initiatives currently underway, it should be able to gradually develop a more diverse economy with multiple crops and livestock generating income, so that a bad season in one sector won’t automatically reverberate across the entire country. The stakes are high, witnessed by the economic difficulties in the wake of last year’s short tobacco crop. Success will mean not only greater food security but also more hard currency to import the items that Malawi cannot produce at home. With luck, it may even boost tourism, as the country’s struggling hospitality sector will be able to stock more of the items its foreign customers expect.

    Taco Tuinstra is Tobacco Reporter’s editorial director.Based in Raleigh, North Carolina, USA, he coordinates the work of staff writers and contributors.On his watch, Tobacco Reporter has won several awards for editorial excellence.Since joining the magazine in 1997, Taco has visited more than 75 countries to meet industry representatives in their markets and to report tobacco news firsthand.
  • Staking a Claim?

    Staking a Claim?

    Photo: Tobacco Reporter archive

    Rethinking the modified-risk tobacco products approval process.

    By Cheryl K. Olson

    It seemed an excellent test case for a new system. After role-playing a U.S. Food and Drug Administration Tobacco Products Scientific Advisory Committee (TPSAC) member, listening to Altria’s presenters rehearse their pitch, that was my impression. I thought that Copenhagen Snuff would likely sail through the modified-risk tobacco product (MRTP) application process.  

    Sold in some form since the 19th century, the product was well understood. From a regulatory perspective, it was comfortably dull. The reduced-harm claim Altria sought to put on Copenhagen’s label seemed indisputably true: “If you smoke, consider this: Switching completely to this product from cigarettes reduces risk of lung cancer.” 

    In February 2019, the TPSAC review panel voted 8-0 that the claim was scientifically accurate. Said panel chair Robin Mermelstein, “I am hearing a consensus that this was an understandable statement. It was clear,” and “I think it is a reasonable place to start in messaging.”   

    Forty-nine months later, the FDA finally authorized Copenhagen Classic Snuff as a MRTP.

    “No tobacco product is safe or ‘FDA approved,’ so those who do not use tobacco products shouldn’t start,” said the director of the FDA’s Center for Tobacco Products (CTP), Brian King, in the March 2023 press release. “But tobacco products do exist on a spectrum of risk, with those that are smoked having the greatest risk. In this case, the FDA’s scientific review found that if an adult smoker completely switched from cigarettes to this smokeless product, it would reduce their risk of getting lung cancer.” 

    How could it take so long to approve the obvious: that complete switching to a (familiar) smokeless product from cigarettes reduces risk of lung cancer? This invites a fresh critical look at the MRTP process: its origin, utility and potential future.

    Some MRTP History

    The U.S. MRTP application process comes to us courtesy of Section 911 of the 2009 Family Smoking Prevention and Tobacco Control Act. It defines “modified-risk tobacco product” as one “sold or distributed for use to reduce harm or the risk of tobacco-related disease.” In addition to the usual scientific evidence for reduced health risks, complex studies of consumer perceptions and real-world product use are required. 

    Don’t have an MRTP authorization? Basically, your company can’t say anything on product labeling, advertising or other media “that would be reasonably expected to result in consumers believing that the tobacco product or its smoke may present a lower risk of disease or is less harmful” compared to other products. Or, that product or its smoke has fewer bad things in it. The act also prohibits the use of weasel words like “light,” “mild” or “low.”

    In October 2019, Swedish Match USA’s eight General Snus products were the first ever authorized for sale with a modified-risk claim. “Today’s action demonstrates the viability of the pathway for companies to market specific tobacco products as less harmful to consumers,” read the FDA’s press release, “but only following a thorough scientific evaluation by the FDA.”

    “It was a priority for CTP to demonstrate that the pathway works,” says Jim Solyst, then vice president for federal government affairs at Swedish Match. But this was four years after the same products received FDA marketing authorization (premarket tobacco product applications (PMTAs)) and took two rounds of TPSAC review.

    The MRTP process is gobsmackingly costly in time and resources. In a 2018 regulatory document, the FDA estimated that it would receive three MRTP applications per year “and that it will take the applicant 10,000 hours per response to conduct studies and collect the information needed to support an MRTPA.” After all that, the claim is only good for five years. (A new application might lead to an extension.) Also, postmarket surveillance studies are mandated to show how the authorized claim actually affected consumer perception, behavior and health.

    This may be why few companies have even entered the MRTP arena. The last TPSAC meeting to review an application took place in early 2020.

    Only four diverse sets of products had emerged successful: snus from Swedish Match, Philip Morris International’s heat-not-burn IQOS systems and their HeatSticks, very-low nicotine cigarettes from 22nd Century Group and Altria’s snuff. (R.J. Reynolds presented on its Camel Snus to the TPSAC but later withdrew the application.)

    At one point, it was logical that if you got a PMTA, it made sense to consider a MRTP. Now with the slowness of getting a PMTA, I don’t think companies have the MRTP as a vision of the next step.

    Jim Solyst, former vice president government affairs, Swedish Match

    Lessons from the Past?

    When does it make sense to consider seeking a claim? “At one point, it was logical that if you got a PMTA, it made sense to consider a MRTP,” says Solyst. “Now with the slowness of getting a PMTA, I don’t think companies have the MRTP as a vision of the next step.”

    Solyst, who is now principal at JMS Scientific Engagement, points to distinctive factors that gave General Snus products an edge with the FDA. These included product-specific long-term studies from Sweden. “They had an incredible amount of human health data and consumer data,” he says.

    The MRTP section of the Tobacco Control Act echoes language from the influential 2001 Institute of Medicine report, Clearing the Smoke: Assessing the Science Base for Tobacco Harm Reduction. That report mentioned Swedish snus multiple times as an example of a potential reduced-exposure product. This, Solyst notes, “did provide a comfort level [for the FDA] to go ahead with an application.”

    Because of these special circumstances, it’s hard to draw firm lessons from Swedish Match’s experience for MRTP wannabes. Nonetheless, Solyst encourages a careful read of the General Snus MRTP decision document: “That indicates what CTP valued in the application.”

    As more products are authorized, patterns for success may become easier to spot, encouraging more companies to try.

    Willie McKinney

    Not So Obvious

    The FDA’s goal is to review and act upon each MRTP application within 360 days of receipt if it contains the required information. While the process may streamline with time, it’s unlikely that approvals will ever be rapid.

    One factor is the FDA culture. Willie McKinney, who served for three years as the industry representative on TPSAC, points to the example of thalidomide. In the early 1960s, Frances Oldham Kelsey famously prevented untold numbers of severe birth defects by questioning a drug application slated for routine approval. “That’s the ideal FDA reviewer,” McKinney says. “‘I saved lives, stopped a bad thing from happening.’”

    McKinney was at times surprised at negative votes on questions posed to TPSAC reviewers about MRTPs. “I came to the conclusion that ‘obvious’ means different things to different people,” he says. In transcripts from past TPSAC meetings, one sees examples of reviewer confusion about how novel products look or work and skepticism about industry-generated data.

    One former staff member at the CTP agreed, saying, “Not knowing the unintended consequences is a biggie.” That person did not feel that politics or bias play a role, however.

    “I have not had anybody say, ‘Hey, delay the review of this.’ It’s usually something that’s unclear,” they said. The involvement of outside reviewers complicates the process: “There are a lot of moving parts.”

    Pluses and Limits  

    From a public health perspective, a plus of the MRTP system is that it gets thoroughly tested information onto product packages and ads. Ideally, this helps people who do and don’t smoke attempt to meaningfully weigh relative risks. 

    “The idea of having a health claim is a good one,” says Solyst. “But it needs to be something that is effective, that results in smokers moving to lower risk products.”

    One problem is that Section 911 limits messaging to a brief statement about reduced risk of disease or exposure to a substance. As a tool to change what people do with nicotine, an MRTP claim is like one of those L-shaped Allen wrenches. It can work well for a simple, specific task.

    But is it adequate for the complex job described in the Copenhagen MRTP press release? By law, the FDA must ensure that the public understands the reduced risk or exposure message used in advertising and labeling. What’s more, they must “understand the significance that information has in the context of total health and in relation to all tobacco-related diseases and health conditions.” That’s a lot to ask from a one-sentence claim.

    Consider this: Strong headwinds of misinformation deter the switch from cigarettes to smokeless. It would be surprising to see large changes in perceptions and behavior intentions from one experimental exposure to a single short statement.

    As Joe Murillo, then senior vice president of regulatory affairs at Altria Client Services, noted in his 2019 presentation to TPSAC, the FDA’s own survey data found that over 90 percent of adults who smoked thought smokeless products were just as or more harmful than cigarettes. Potential harm to nonusers of tobacco is factored into the FDA’s MRTP decisions. Isn’t harm from inaction—of not correcting high-risk misinformation—just as important to consider?

    The Future of MRTPs

    Among other recommendations, the recent report from the Reagan-Udall Foundation for the FDA encourages the CTP to develop a “more clear and predictable framework” for PMTA and MRTP submissions and reviews. This includes “simplifying, standardizing, documenting and publicly disseminating review procedures.” It’s noteworthy that the FDA sought comments on its draft guidance for MRTPs in 2018 but has yet to publish final guidance. 

    An April 2023 letter to FDA Commissioner Robert Califf by a group of distinguished researchers and advocates (including Mermelstein) expands on the Reagan-Udall recommendations. “Introduce a simplified system for evaluating incremental improvements to authorized products so American consumers can benefit sooner from product innovations,” they write. “This should apply to both the PMTA process for authorizations and the MRTP pathway for modified-risk claims. FDA’s processes should encourage pro-health innovation, not obstruct innovation or deny Americans access to the best technologies available worldwide.”

    Cheryl K. Olson is a California-based public health researcher who specializes in behavioral health issues and consults on tobacco product behaviors via McKinney Regulatory Science Advisors. She spent 15 years on the faculty of Harvard Medical School.