Lausanne- “Designing a smoke-free future” is the goal of Philip Morris International (PMI), said the company’s global communications manager, Anna Bodi, during a presentation for a group of journalists, Daily News Egypt included, at the company’s research and development (R&D) centre in Switzerland.
PMI aims to offer smoke-free alternatives that have the potential to reduce the risk of developing smoking-related diseases, as compared with continued smoking, Bodi added, explaining that this is why PMI decided to create an R&D centre in 2009. “We work on creating products to be satisfying to current adult smokers, so they can fully switch.”
Smoking tobacco causes several serious diseases and increases the risk of early death. In fact, based on population trends, it is estimated that there will be more than 1 billion smokers by 2025, about the same number currently exists.
“Given this number, and as the technology now exists and continues to develop, it makes sense to offer consumers, less harmful, yet satisfying, smoke-free alternatives,” said Bodi.
According to international statistics, a person dies every six seconds due to smoking-related illness, and half of smokers will die from a disease directly linked to their use of combustible tobacco or traditional smoking.
The criticisms tobacco companies face and the huge technological revolution sweeping the world have led these companies to think of alternative products for smokers; products that companies say are “less harmful” than conventional smoking.
According to the World Nicotine Forum held two weeks ago in the Polish capital, Warsaw, the e-cigarette is safer by 95% compared to traditional cigarettes. Moreover, according to presentations in the global forum, there are many markets which have started using non-burning smoking products, such as Japan, Italy, and Russia.
As per an international report issued by the Foundation for a Smoke-Free World in New York, about a billion people around the world smoke and there are more than 7 million people that die each year as a result of smoking. This is all while the sales of nicotine products in 2017 reached $785bn, of which 89.1% were cigarettes.
The report shows that there is a clear growth in the sales of e-cigarettes, where the estimated sales of electronic smoking products reached $11.4bn, up by 21% compared to the previous three years. Meanwhile, heat-based cigarettes saw sales of $6.3bn, up by 52% against the previous three years, including 85% in Japan alone.
The report said that e-cigarettes, in general, have recently seen a clear growth compared to traditional cigarettes, adding that the top players in the cigarette industry turned into the next generation of smoking products, where Philip Morris of Switzerland introduced the IQOS in August in 48 markets around the world.
In the same context, Japan Tobacco aims to offer the Bloom Tech products outside its home country, including the US, Canada, and Switzerland. Moreover, British American Tobacco will also introduce heating-based products in South Korea, Russia, Romania, Canada, and Switzerland.
“We welcome the competition because it means more research. At the same time, we are not afraid of competition. We started the journey since the early 1990s, so we have a good experience in the field,” concluded Bodi.
The R&D centre gave the opportunity to move from very little innovations to different innovations, said Nuno Fazenda, manager scientific engagement at PMI.
He explained that the process of burning cigarettes is a most dangerous one, noting that the nicotine itself is not causing diseases or death.
“PMI’s R&D decided to develop products that deliver nicotine, the taste and the flavour, through a clean way. We develop a lot of products, but the IQOS is the healthiest product,” explained Fazenda.
And that’s why, after only four years, it is presented in 48 countries as 10 million people are using it, of which 7.3 million quit cigarettes completely.
“The IQOS, the company’s flagged heated tobacco product, which uses the idea of heating tobacco, instead of burning it, has been around for over two decades. It is only now that we have finally managed to find ways to heat tobacco which results in products that satisfy adult smokers. The IQOS uses sophisticated electronics to heat specifically prepared and blended tobacco,” Fazenda added.
The PMI is building a future on smoke-free products (also referred to by the company as Reduced Risk Products or RRPs) that are a much better consumer choice than continuing to smoke cigarettes.
In its 2017 sustainability report, PMI stated the ambition that by 2025, at least 30% of its revenues would come from smoke-free products.
According to international researchers conducted by the US Food and Drug Administration (FDA) and Health Canada, the users of IQOS achieve between 90-95% of what they can achieve if they quit smoking. “The aim is to demonstrate that the toxicity of the aerosol from smoke-free products is lower than that of cigarette smoke.”
In this context, IQOS was authorised for sale by the FDA on 30 April 2019, to be the first electric heated product qualified for sale in the US. It will be launched in Lebanon and Jordan this year; however, it will take some time to be launched in the European Union (EU) because legal proceedings need time.
The sales of IQOS, according to the presentation of the PMI’s R&D, registers 10.4 million in the first quarter (Q1) of 2019, compared to the 2.9 million in Q1 in 2017. (70% quit smoking completely and switched to IQOS).
Egypt is a key market
Philip Morris is a key player in Egypt’s economy, as Philip Morris Misr (PMM) is the top international player in the Egyptian tobacco industry, with a 24% market share and around one-third of the total tobacco taxes revenues.
The company provides numerous job opportunities, as it employs around 2,500 people, whether directly or indirectly, across its value chain, including manufacturing, supply chain, and distribution among others. This comes in addition to over 100,000 retailers who sell Philip Morris products on a daily basis.
“The industry has significantly evolved, and PMM has been playing a major role in its development. The Egyptian market is witnessing strong competition, thanks to the presence of international tobacco companies within Eastern Company. Eastern Company manufactures a total of 86bn cigarettes annually for all tobacco companies operating in Egypt,” the Managing Director of PMM and Levant, Vassilis Gkatzelis, told Daily News Egypt.
“Egypt is a key market for us, and has great potential for a smoke-free future. We would like to offer better alternatives to adult smokers in Egypt,” he added.
When will IQOS be introduced in Egypt?
PMM is working with the Egyptian government and its partners to turn this into a reality; however, no launch date has been set yet, Gkatzelis said. Regardless, the IQOS would be launched following obtaining all regulatory approvals.
For the IQOS pricing, he noted that it is too early to announce the device’s price, stressing, “we are targeting all segments of Egyptian smokers.”