Tag: IQOS

  • U.S. Market Poised for Disruption

    U.S. Market Poised for Disruption

    Photo: vfhnb12

    The American tobacco market is poised for disruption as Altria Group’s exclusive U.S. distribution rights to Philip Morris International’s IQOS heat-not-burn product expires on April 30, reports The Wall Street Journal. After this date, PMI will be free to compete in the U.S. with its top noncigarette brand.

    PMI hopes IQOS can help it grab a 10 percent share of the lucrative U.S. cigarette and heated-tobacco market by roughly 2030, representing an additional $2.2 billion in annual earnings before interest, taxes, depreciation and amortization, according to Stifel analysts.

    Altria, with its 50 percent share of the American cigarette market, has a lot to lose if PMI can persuade more smokers to switch to noncombustible alternatives.

    In recent years, U.S. smokers have become more receptive to alternative nicotine delivery methods. Last year, 40 percent of all nicotine products sold in the U.S. were smoke-free offerings such as e-cigarettes and oral nicotine pouches. The share of traditional cigarettes, meanwhile, declined to 60 percent last year from 80 percent in 2018.

    If the trend continues, Americans will be more likely to reach for a vape or nicotine pouch than a cigarette within three years.

    Already earning some 40 percent of its net revenue from smoke-free products, PMI needs not worry about the dwindling number of U.S. smokers because it doesn’t sell cigarettes in America.

    Altria, by contrast, still relies heavily on combustible cigarettes, which currently account for 85 percent of its sales. Its comparatively low exposure to the smokefree market includes brands such as On! oral nicotine pouches and Njoy e-cigarettes. The company also has a joint venture with Japan Tobacco to launch Ploom heated tobacco sticks in the U.S. and is working on its own heat-not-burn brand.

    A badly timed bet on Juul Labs saddled the company with a $12.5 billion loss.

    On the flipside, Altria has a strong U.S. distribution network, which it can leverage to promote its brands—a considerable advantage as the point of sale is one of the few places where tobacco companies are still allowed to advertise their products.

    Altria can also harness data to defend its patch. The tobacco giant is integrated into many retailers’ loyalty programs, allowing it to monitor what shoppers are buying.

  • Job Ads Suggest IQOS Debut in Austin

    Job Ads Suggest IQOS Debut in Austin

    Image: Alexander

    The resolution of an IP dispute with BAT has removed a major hurdle to selling the product in the U.S. 

    Philip Morris International is preparing to launch its IQOS heated-tobacco device in Austin, Texas, USA, reports U.S. News. The city will be a testing ground for PMI’s re-entry into the United States after the company resolved an intellectual property dispute with British American Tobacco that had prompted the International Trade Commission to ban imports of IQOS in the United States.

    PMI previously announced that it planned to launch IQOS in four cities in two U.S. states beginning with one city in the second quarter before a larger rollout in 2025. The company did not, however, release details.

    According to U.S. News, LinkedIn job advertisements suggest that PMI is planning to launch the product in Austin. The advertisements were posted this month and include positions such as field sales representatives, territory managers and retail sales advisors.

     

    The U.S. would be a significant market for IQOS. Euromonitor estimates that total U.S. nicotine sales excluding nicotine-replacement therapies were $143.6 billion in 2022. Cigarettes accounted for the majority of sales, but Euromonitor predicts that their value will drop by 30 percent by 2027 and the value of smoking alternatives such as e-cigarettes and nicotine pouches, will increase by 36 percent in the same period.

     

    Investors are waiting to see if PMI can create a heated-tobacco market in the U.S., where vaping is dominant.

    According to Brett Cooper, managing partner and analyst at equity research firm Consumer Edge, Texas offers an interesting trial market due to broad demographics. He noted that diverse cities like Austin, Houston and Dallas provide access to a wide range of consumer groups.

     

    U.S. Centers for Disease Control and Prevention data shows that tobacco taxes in Texas are relatively low, with the excise tax rate on a pack of cigarettes standing at $1.41 in September 2023.

    In January, Texas introduced new e-cigarette laws, banning products that resemble food or that include symbols or celebrities targeted at minors or that depict cartoon-like fictional characters.

    PMI believes IQOS can capture a 10 percent share of the U.S. tobacco and heated-tobacco unit volume by 2030.

     

  • IQOS Iluma i Debuts in Japan

    IQOS Iluma i Debuts in Japan

    Photo: Ned Snowman

    Philip Morris International has launched IQOS Iluma i, the latest and most innovative addition to its growing portfolio of smoke-free products, in Japan. The launch marks the 10-year anniversary of IQOS, which debuted in Nagoya, Japan, in 2014.

    “We leverage science, world leading brands and commercial capabilities to provide better alternatives to our consumers. This anniversary provides an opportunity to renew our smoke-free vision and our ambition for over two-thirds of our total net revenue to come from smoke-free products by 2030,” said PMI CEO Jacek Olczak in a statement.

    “IQOS Iluma disrupted the category by introducing induction-heating technology that heats tobacco from within, to provide a consistent taste experience, no tobacco residue, and no need to clean the device. Today, we take IQOS to new heights, with the launch of IQOS Iluma i—the latest innovation in our smoke-free portfolio, offering a range of advanced features for a clean, seamless, and more flexible experience.”

    The IQOS Iluma i series offers three devices in Japan: IQOS Iluma i PRIME, IQOS Iluma i and IQOS Iluma i ONE. All three devices bring a range of adaptable new features.

    The new touch screen on the device’s holder allows users to see experience-relevant information quickly and easily. To personalize the experience, IQOS Iluma i introduces a new pause mode. By swiping up or down on the touch screen, users can pause and resume their consumption according to their preferences.

    The new IQOS Iluma i also includes smart features that help prolong the lifespan of the holder’s battery. Furthermore, the door for IQOS Iluma i is made from aluminum produced with renewable energy and the inner textile layer of IQOS Iluma i’s Prime leather-like wrap is made of 100 percent recycled plastic.

    “IQOS Iluma i is our most innovative offering to date and the new flagship in our portfolio of scientifically substantiated, heat-not-burn smoke-free systems,” said Bertrand Bonvin, president heat-not-burn platforms at PMI. “Like previous IQOS devices, it emits, on average, 95 percent lower levels of harmful chemicals compared with cigarettes. We are proud that consumer feedback continuously fuels our innovation, and IQOS Iluma i is a testament to that.”

  • The Invisible Advantage

    The Invisible Advantage

    IQOS joined the Tobacco 10 ranking in 2023, achieving a brand value of $3.25 billion—higher than combustible brands such as Chesterfield or Rothmans. Photo: elenavah

    Intangible assets remain a major contributor to the real value generated by the tobacco industry.

    By Stefanie Rossel

    Brand value is a nonphysical asset but one of the most important issues for every brand owner. Brand valuations are used for several purposes such as tax calculation, finance and marketing. They function as interpreters between the language of marketers and finance teams and provide structure for both to work together to maximize returns. Measuring such intangible assets is complex—the most common metrics on which brand performance and thus brand equity can be judged include market penetration, frequency of purchase, repeat purchase, customer loyalty and the ability of a brand to command a price premium versus other brands in its sector.

    In 2023, the global value of intangible assets owned by the world’s largest companies stood at $61.9 trillion in 2023, up from $57.3 trillion one year previously, according to the Global Intangible Finance Tracker (GIFT) report, which is published annually by Brand Finance, an independent, U.K.-based brand valuation and strategy consultancy.

    While tech giants like Apple (with intangible assets of $2.7 trillion) and Microsoft ($2.3 trillion) continued to lead the pack in the 2023 analysis, last year’s most intangible sector in relative terms, with 91 percent of total enterprise value, was tobacco and e-cigarettes, as companies invested heavily in proprietary technology and patented intellectual property around vaping devices to drive growth, according to Brand Finance.

    In the company’s Tobacco 10 ranking, Marlboro remained the undisputed leader with a brand value of $34.74 billion followed by Pall Mall ($6.54 billion) and L&M ($6.35 billion). The list is dominated by combustible brands, but there are two noteworthy exceptions—smokeless tobacco brand Copenhagen and heated-tobacco product (HTP) IQOS.

    Despite being the most intangible sector, tobacco products across all categories experienced significant brand value losses. “The performance decline witnessed in combustibles across extensive tobacco portfolios during the years 2022 and 2023 directly contributed to the decrease in brand value within our rankings,” explains Brand Finance’s global managing director, Richard Haigh. “Specifically, the decline in the volume sold of traditional oral cigarettes has been a consistent trend over the years. This can be attributed to reduced consumption and an accelerated shift in consumer preferences, leading to category switching. As we delve into the intricacies of this development, it becomes apparent that the challenges faced by combustible brands played a pivotal role in shaping the dynamics of brand value within the Tobacco 10 for 2023.”

    BAT’s $31.5 billion impairment on the value of some of its U.S. cigarette brands last December resonates with Haigh’s observations. “The decision to write down the value of some of its brands was a bold step for BAT because despite the short-term pain, the reality is that the market for cigarettes is shrinking, and pretending otherwise would be irresponsible on the part of management,” he says.

    Nevertheless, it is difficult to predict at this point who will need to follow BAT’s example. “The decision by BAT to impair its U.S. cigarette brands may not necessarily set a direct precedent for other companies. Each tobacco company’s considerations and actions are likely to be influenced by their unique brand portfolios, acquisition histories and strategic priorities within the evolving tobacco industry landscape.”

    Marlboro remained the undisputed leader in Brand Finance’s tobacco ranking, with a brand value of $34.74 billion. Photo: jetcityimage

    A Win-Win Move

    In the GIFT ranking, BAT retained its position as the most intangible entity within the sector, boasting a total intangible value of $135.2 billion despite several acquisitions by its competitors. According to Brand Finance, China National Tobacco Corp. (CNTC) stood out in the 2023 GIFT study for accumulating substantial disclosed intangibles and goodwill. Its position was bolstered by its $63.4 million acquisition of China Tobacco International Brazil in late December 2021. Similarly, Philip Morris International’s acquisition of Swedish Match added approximately $18 million in goodwill and intangible assets to its financial statements.

    “The acquisition of Swedish Match by Philip Morris International has proven to be mutually beneficial for both companies,” says Haigh. “PMI gains access to significant smoke-free brands, enriching its portfolio, while Swedish Match benefits from the resources and expertise offered by a larger organization. An intriguing aspect of this acquisition is the creation of an impressive, combined portfolio of smoke-free brands.”

    He adds that the Tobacco 10 2023 ranking, which closely followed the November 2022 acquisition, did not show immediate noticeable impacts on the brand values of Swedish Match. “It was considered too early to discern any substantial changes. The anticipation now shifts to the upcoming 2024 tobacco ranking, where the performance of Swedish Match within this context will be pivotal in assessing the positive impact on both the financial and brand value performance for both Swedish Match and PMI. This evaluation will shed light on the effectiveness and synergies generated by the acquisition, providing valuable insights into the long-term implications for the brands involved.”

    “The decision by BAT to impair its U.S. cigarette brands may not necessarily set a direct precedent for other companies.”

    Richard Haigh, global managing director, Brand Finance

    On the Way Up

    Even before its takeover of Swedish Match, PMI succeeded in building a valuable reduced-risk brand. In 2023, its HTP IQOS joined the Tobacco 10 ranking for the first time, achieving a brand value of $3.25 billion—higher than combustible brands such as Chesterfield or Rothmans. In the 2024 ranking, IQOS has climbed three spots following an 8 percent brand value increase, Haigh points out. “The brand is currently valued at $3.5 billion. This notable increase is attributed to robust performance in the recent financial year. The brand has demonstrated improvement in revenues, expanded market share and witnessed a significant influx of customers switching to IQOS. These factors collectively contribute to the upward trajectory of IQOS in terms of brand value since its initial tracking in 2020.”

    There is, however, still a substantial gap in terms of brand value between IQOS and Marlboro, which is valued at $32.5 billion in this year’s ranking. Since 2015, Marlboro has maintained its position as the world’s most valuable tobacco brand, and its resilience is evident, as the company celebrated its 50th anniversary in 2022, he says. “Despite recent challenges, such as disposable income pressures in various markets and the impact of cannibalization from IQOS, Marlboro has demonstrated enduring strength.”

    The considerable difference in brand value between the two products is attributed to Marlboro’s extensive market presence, reflected in higher shipment volumes and revenue generation within the Philip Morris portfolio, Haigh explains. “Although IQOS exhibits consistent growth, surpassing Marlboro in brand value necessitates a substantial increase in its revenue contribution within the PMI portfolio. As IQOS continues to expand its market share and revenue, the potential for it to catch up with or overtake Marlboro in brand value remains contingent on its sustained growth and further integration within PMI’s overall portfolio. The journey to equivalence or overtaking Marlboro is a dynamic process, influenced by various factors that will shape the evolving landscape of PMI’s brand portfolio in the coming years.”

    CNTC stood out in 2023 for accumulating substantial intangibles and goodwill.

    There’s Value in Alternatives

    So far, no vape product brand has made it onto Brand Finance’s Tobacco 10, which, according to Haigh, has been dominated by combustibles, traditional oral and smoke-free brands since 2015. The market for reduced-risk products (RRPs), in particular e-cigarettes, is highly fragmented. Since their first introduction to the market 20 years ago, a myriad of smaller brands has emerged, manufactured by smaller players, among them, only very few iconic ones.

    However, there has been a gradual but steady entry of smaller RRPs into the rankings, says Haigh. “While the Tobacco 10 ranking primarily features established names, it is noteworthy that smaller players in the reduced-risk product category are gaining visibility in our rankings,” says Haigh. “Notable examples include IQOS, Glo (brand value $2.3 billion in 2023), Vuse ($1.4 billion) and Velo ($580 million). These brands, although not reaching the high values necessary to secure a spot in the top 10 globally, have made a significant impact on the market and our ranking. Over the past three years, all these brands have exhibited double-digit growth, reflecting their increasing presence in markets and contributing to their upward trajectory in our ranking. While their individual brand values may not place them among the top 10, the consistent growth signifies a notable trend in the industry. This gradual ascent of reduced-risk products and the sustained growth of these brands underscore their evolving significance in the market and their potential to further reshape the dynamics of the tobacco industry in the coming years.”

    Establishing an iconic e-cigarette brand necessitates a dual focus, Haigh stresses, judging from his experience of evaluating the prominence of e-cigarette brands within leading tobacco companies. “It requires technological advancement, involving continuous product development and research and development. Simultaneously, building a robust online presence across multiple channels emerges as a crucial strategy to drive sales and effectively capitalize on the growing market demand for these products.”

    With combustible cigarettes experiencing declining volumes, smoke-free products have been consistently ascending in rankings over the last three years.

    Remaining Agile

    The report underscores that despite increasing regulations on traditional tobacco products in developed markets, e-cigarettes remain in a nascent stage and are currently generating high intangible value. “This is primarily due to the lack of marketing regulations governing these products,” says Haigh. “The absence of stringent rules allows e-cigarette manufacturers to continuously iterate on device design, flavors and other product attributes, enhancing appeal and driving sales growth.” Of course, this sector’s outlook may be dampened by anti-tobacco harm reduction sentiments, especially in the wake of the recent Conference of the Parties to the World Health Organization Framework Convention on Tobacco Control.

    “As e-cigarettes are currently enjoying high intangible value partly due to a lack of marketing regulation, any future regulations may influence the competitive landscape and strategies of tobacco companies, potentially affecting the brand value of RRPs,” says Haigh. “The ability of companies to adapt their marketing approaches and navigate evolving regulatory environments will likely play a crucial role in determining the impact on brand value in the realm of RRPs.”

    In the near term, Haigh expects the development of nicotine brands’ value to undergo several significant shifts as global cigarette sales volumes continue to decline. “With combustible cigarettes experiencing declining volumes, smoke-free products have been consistently ascending in rankings over the last three years,” says Haigh. “This ascent is driven by their increased market share and revenue generation, signaling a notable trend in consumer preferences toward reduced-risk alternatives.”

    Business model transformations will become another important factor. In response to the risk posed by declining shipments and revenue in the traditional cigarette market, companies are actively initiating transformations in their business models. “This involves a strategic shift toward becoming truly multi-category consumer products businesses,” says Haigh. “By diversifying their product portfolios to include smoke-free alternatives, companies aim to adapt to changing consumer demands and mitigate the impact of declining cigarette sales.”

    Finally, tobacco companies will likely place greater emphasis on sustainability. “Consumers are prioritizing sustainable practices, and major tobacco companies are responding accordingly,” says Haigh. “Initiatives such as sustainable farming and waste reduction are being embraced, exemplified by [BAT’s] hiring of its first chief sustainable officer in late 2022. Similarly, Philip Morris International has introduced a bespoke sustainability index, demonstrating a commitment to measuring its ESG performance.”

    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.
  • IQOS Surpasses Marlboro in Revenue

    IQOS Surpasses Marlboro in Revenue

    Photo: Arkadiusz Fajer

    Philip Morris International reported net revenues of $9.05 billion for the fourth quarter and net revenues of $35.17 billion for fiscal year that ended Dec. 31, 2023. On a reported basis, the figures were up 11 percent and 10.7 percent, respectively, over the comparable 2022 periods.

    Performance was driven by revenue growth in both the combustible cigarette business, where pricing offset reduced volumes, and the company’s smoke-free operations, which continued to increase their share of the company’s business mix.

    “We are pleased that smoke-free products reached nearly 40 percent of our total net revenues and over 40 percent of our gross profit in the fourth quarter,” said PMI CEO Jacek Olczak in a statement.

    “This was led by the continued growth of IQOS, which has now surpassed Marlboro in terms of net revenues, confirming its position as the leading premium nicotine brand less than 10 years from launch. The fourth quarter also marked the first anniversary of our combination with Swedish Match, which delivered very strong results in 2023 driven by the stellar U.S. performance of ZYN.”

    PMI shipped 116.3 million cans of ZYN in the fourth quarter of 2023, representing growth of 78.2 percent versus fourth-quarter 2022 Swedish Match shipments of 65.3 million cans.

    “We are entering 2024 with strong momentum, and we expect it will be another year of excellent performance underpinned by an acceleration in organic smoke-free net revenue and profit growth,” said Olczak.

    PMI also expects to benefit this year from a recent settlement with British American Tobacco that resolves all ongoing patent infringement litigation between the parties related to heated tobacco and vapor products. The deal allows each party to innovate and introduce product iterations.

  • PMI Expands IQOS in Middle East

    PMI Expands IQOS in Middle East

    Image: TRITOOTH

    Philip Morris International has launched IQOS Iluma in Saudi Arabia, Kuwait and Bahrain, with a goal of creating a smoke-free future in the Gulf Cooperation Council region, according to the Saudi Gazette.

    “Adult smokers may be unaware of the choices they are making, largely due to the lack of information and knowledge on products that bring them harm, versus scientifically backed products that reduce the likelihood of smoking-related disease,” said Tarkan Demirbas, area vice president of the Middle East at Philip Morris Management Services (Middle East) Limited. “At PMI, we are invested in providing existing adult smokers with better alternatives through harm reduction innovations, which can help them take a step back from cigarettes toward better alternatives.”

    “Smoking-related diseases today call for a pragmatic solution that places consumers at the forefront while moving away from cigarettes,” said Saim Yasin, director of marketing and digital at PMMS. “IQOS Iluma is our latest innovation in tobacco-heating systems that will accelerate our goal toward a smoke-free future. Through a growing portfolio of smoke-free alternatives, we are reaffirming our commitment to create realistic, society-wide change that can reimagine the world we are living in—without cigarettes.”

    The IQOS Iluma series offers three devices: IQOS Iluma Prime, IQOS Iluma and IQOS Iluma One. All the devices use new induction heating technology but offer different designs.

  • PMI Applies to Sell IQOS Iluma in the U.S.

    PMI Applies to Sell IQOS Iluma in the U.S.

    Photo: vfhnb12

    Philip Morris International Oct. 20 submitted premarket tobacco product applications (PMTAs) and modified risk tobacco product applications (MRTPAs) for IQOS Iluma heated tobacco products with the U.S. Food and Drug Administration (FDA).

    IQOS Iluma products are PMI’s most-innovative heated tobacco products. They deliver substantially similar reductions in the formation of harmful and potentially harmful constituents as earlier versions of IQOS products authorized by FDA

    According to PMI, IQOS Iluma has demonstrated higher rates of full switching by adults who smoke and improved consumer satisfaction in many countries.

    IQOS Iluma products rely on a fundamentally different heating technology from previous versions of IQOS products and contain numerous technological advancements including improved device and battery longevity.

    IQOS Iluma products are currently available in 27 markets internationally

    PMI’s applications are supported by a thorough scientific assessment, including aerosol chemistry, in vitro toxicology, a pharmacokinetic study, and consumer perception and behavior studies, as well as the comprehensive scientific dataset generated with previous versions of the IQOS system

    The IQOS Iluma devices operate on the Smartcore Induction System that heats tobacco from within Terea Smartcore Sticks—heated tobacco sticks designed to be used only with IQOS Iluma devices

    PMI has submitted applications for three Iluma devices and five variants of the tobacco sticks: Terea Blue, Terea Green, Terea Sienna, Terea Bronze, Terea Amber

    Internationally, IQOS Iluma products have demonstrated how ground-breaking consumer-centric innovation can lead more adults to stop smoking. We believe that same success can be replicated in the U.S.

    Stacey Kennedy, president Americas and CEO of PMI’s U.S. business

    “Tens of millions of American adults today smoke cigarettes and will likely continue to do so. They should have a range of scientifically substantiated better alternative nicotine products to choose from, and PMI is committed to providing them with new choices,” said Stacey Kennedy, president Americas and CEO of PMI’s U.S. business, in a statement.

    “Internationally, IQOS Iluma products have demonstrated how ground-breaking consumer-centric innovation can lead more adults to stop smoking. We believe that same success can be replicated in the U.S. and drive a rapid decrease in smoking rates among adults. These are strong applications, and we urge the FDA to prioritize them for review.

    “Since 2008 PMI has invested more than $10.5 billion to scientifically research, develop, and commercialize smoke-free products, an investment that was further bolstered last year through our acquisition of Swedish Match. We are focused on providing adults who smoke with alternatives that can reduce their risks compared with smoking and help make America cigarette-free.”

    PMI will have the full rights to commercialize all IQOS products in the U.S. as of April 30, 2024, per the terms of an agreement with Altria Group, Inc. ending the companies’ commercial relationship covering IQOS in the U.S.

  • Three Heating Products Authorized in the U.S.

    Three Heating Products Authorized in the U.S.

    Photo: Destina

    The U.S. Food and Drug Administration has authorized the marketing of three new tobacco-flavored heated-tobacco products included in Philip Morris Products’ supplemental premarket tobacco product applications (PMTAs). The products receiving marketing granted orders are Marlboro Sienna HeatSticks, Marlboro Bronze HeatSticks and Marlboro Amber HeatSticks, each of which is used with the IQOS tobacco-heating device.

    Based on the FDA’s review of the supplemental PMTAs, the agency determined that the marketing of these products should be authorized because, among other things, the net population-level benefits to adult smokers outweigh the risks to youth.

    In 2019, the FDA authorized the marketing of IQOS and several other Marlboro HeatSticks products through the PMTA pathway. Philip Morris pursued marketing authorization for these new Marlboro HeatSticks by submitting supplemental PMTAs for modified versions and line extensions of the tobacco-flavored product for which the company had previously received a marketing granted order. A supplemental PMTA can be submitted in situations where an applicant is seeking authorization for a new tobacco product that is a modified version of a tobacco product for which they have already received a marketing granted order. 

    Following the FDA’s rigorous scientific evaluation of the applications, the agency determined that Marlboro Sienna HeatSticks, Marlboro Bronze HeatSticks and Marlboro Amber HeatSticks are comparable to the previously authorized tobacco-flavored product. Like the previously authorized products, the FDA has placed stringent marketing restrictions on the new products in an effort to prevent youth access and exposure.

  • Philip Morris Launches Bonds by IQOS

    Philip Morris Launches Bonds by IQOS

    Photo: PMI

    Philip Morris International has launched its latest heat-not-burn tobacco-heating system, Bonds by IQOS, along with its compatible tobacco sticks, Blends, in a pilot market in the Philippines. The company intends to further commercialize the product during the remainder of 2022 and next year.

    Equipped with bladeless resistive external heating technology, Bond emits 95 percent less harmful chemicals compared to cigarettes, according to PMI.

    “Bonds by IQOS represents another step forward in our ambition to replace cigarettes with innovative, science-based, smoke-free alternatives,” said PMI CEO Jacek Olczak in a statement.

    “We know that no single smoke-free product will appeal to all adult smokers. Providing a range of alternatives to continued smoking—with a variety of taste, technology, usage and price options—is imperative and helps us to address a range of preferences as diverse as adult smokers themselves—ultimately encouraging them to leave cigarettes behind.

    “Bonds by IQOS provides an opportunity to address consumer acquisition barriers for this segment, most notably up-front device costs and authentic tobacco taste satisfaction—providing further options of innovative smoke-free options to help ensure they do not go back to cigarettes. Through continuous innovation, we want to ensure that all adult smokers who would otherwise continue smoking switch and abandon cigarettes.”

    According to PMI, Bonds by IQOS is designed to be used only with Blends tobacco sticks to deliver a variety of tobacco tastes. At the time of launch, Blends tobacco sticks will be available in five different flavors, including classic, menthol and aromatic. When fully charged, Bonds by IQOS delivers up to 20 uses, including three consecutive experiences. Bonds by IQOS comes in four different colors.

  • Reynolds Requests Retrial of Vuse IP Case

    Reynolds Requests Retrial of Vuse IP Case

    Image: inimalGraphic

    R.J. Reynolds Vapor Co. has asked for a new trial after a U.S. District Court awarded rival Altria Client Services $95.23 million in damages related to an e-cigarette intellectual property dispute, reports the Winston-Salem Journal.

    In early September, a federal jury determined that Reynolds Vapor’s Vuse Alto product infringes on three Altria patents.

    In its retrial request, Reynolds Vapor stated that “Altria’s improper injection of inflammatory evidence regarding patent infringement allegations against Reynolds in other cases denied Reynolds a fair trial. Erroneous evidentiary rulings also prejudiced Reynolds’ ability to present its defense. Those errors independently, and under the cumulative error doctrine, affected the verdict such that a complete new trial is required.”

    Altria said in a statement that “this was a fair trial. There is no basis for another trial, and we are pleased that the jury correctly found that Reynolds Vapor has infringed a number of our patents.”

    The complaint concerns three patents awarded to Altria Client Services by the U.S. Patent and Trademark Office based on filings in April 2015.

    Altria alleged Reynolds Vapor violated Altria’s patents covering the pod assembly used in Vuse Alto.

    Reynolds believes the lawsuit was filed in retaliation for patent infringement complaints filed by Reynolds in April 2020 for infringement by Philip Morris International’s IQOS tobacco-heating device of six Reynolds patents.

    Until recently, Altria was the exclusive U.S. distributor for IQOS in the United States.

    On Sept. 29, 2021, the U.S. International Trade Commission upheld an initial determination from May 2021 that Philip Morris International’s IQOS device infringes on two patents owned by Reynolds. The ruling barred Altria Group from importing IQOS products into the U.S.