Philip Morris Worldwide is planning to launch its iQOS smoking gadget in India, 4 sources conversant in the matter instructed Reuters, because the tobacco large seeks a foothold in a rustic with the world’s second-biggest smoker inhabitants.
Philip Morris says the modern, pen-like iQOS heats however doesn’t burn tobacco, producing a nicotine-containing vapor moderately than smoke and making it much less dangerous than typical cigarettes. The corporate says it needs to someday cease promoting cigarettes altogether.
India has stringent legal guidelines to discourage tobacco use, which the federal government says kills greater than 900,000 individuals yearly. However the nation nonetheless has 106 million grownup people who smoke, second solely to China in keeping with the World Well being Group, making it a profitable marketplace for Philip Morris to focus on.
A authorities supply mentioned New Delhi would hold an “open thoughts” if Philip Morris approached it to debate a tool that helped individuals stop smoking, however added such units, together with e-cigarettes, might be banned if discovered to be dangerous.
The well being ministry didn’t reply to a request for remark.
Philip Morris plans to start out strategizing an iQOS launch in India, which would come with work on branding and pricing, in addition to reaching out to media and regulators, sources conscious of the plan mentioned.
The corporate’s prime company affairs government in India, R. Venkatesh, has been interviewing candidates for a senior government who would concentrate on iQOS, the sources mentioned.
The corporate needs “to place collectively a technique to realize its acceptability as a lowered danger product”, mentioned one of many sources, including that Philip Morris needed to have a public relations technique in place earlier than shifting forward.
A Philip Morris spokesman mentioned “we don’t touch upon our launch plans, however are dedicated to working exhausting to interchange cigarettes with scientifically substantiated smoke-free merchandise.” Venkatesh didn’t reply to a request for remark.
However the firm seems to have already began constructing a public case for iQOS in India.
On “World No Tobacco Day” final week, Venkatesh wrote a column for India’s Financial Instances newspaper, calling for “efficient laws” for different smoking units.
“With options to cigarettes obtainable and nations already delivering on their smoke-free ambitions, the inducement is there for lawmakers to assist Indian people who smoke – who deserve a greater possibility,” Venkatesh mentioned.
India’s tobacco market
Philip Morris has for years promoted its Marlboro cigarettes in India. Although its market share has quadrupled lately, Marlboro nonetheless accounts for less than about 1.four % of India’s $10 billion cigarette market.
In accordance with inside paperwork printed by Reuters final 12 months, the corporate sees India as a “excessive potential market” the place it aimed toward “successful the hearts and minds” of individuals between 18, the minimal authorized age to purchase tobacco merchandise, and 24.
IQOS is presently utilized by almost 5 million individuals in additional than 30 nations, led by Japan which successfully bans common e-cigarettes however permits “warmth not burn” units.
India might provide Philip Morris an enormous alternative on account of its burgeoning center class, mentioned Shane MacGuill, head of tobacco analysis at Euromonitor Worldwide.
“It is a wager on the long run,” MacGuill mentioned. “In the long term, there might be very huge rewards for them in India.”
Philip Morris’ so-called lowered danger merchandise, corresponding to iQOS, helped the corporate clock $three.eight billion in web revenues final 12 months, in contrast with $739 million within the earlier 12 months.
To garner assist for iQOS in India, Philip Morris plans to succeed in out to influential individuals who might voice public assist for the gadget forward of its launch, two of the sources mentioned.
Nonetheless, if Philip Morris seeks Indian approvals, it might have to persuade a authorities that has lately raised cigarette taxes, ordered corporations to print larger well being warnings on tobacco packs and launched a quit-smoking helpline.
Prakash C. Gupta, director on the Healis Sekhsaria Institute of Public Well being close to Mumbai, criticized Philip Morris’ plans.
“They level out a few of the toxicants could also be lower than cigarettes, however that does not set up the security of the product,” Gupta mentioned. “Will probably be utilized by prosperous youth, which will probably be dangerous for public well being.”
Philip Morris has additionally utilized to the U.S. Meals and Drug Administration for permission to market the gadget as being much less dangerous than cigarettes. In January, a panel of FDA advisers mentioned iQOS exposes customers to decrease ranges of dangerous chemical substances, however added the corporate had not proven that decreasing publicity to these chemical substances was fairly more likely to translate right into a measurable discount in illness or dying.
India’s well being ministry has for years mentioned it needs to manage e-cigarettes – units which use a nicotine-laced liquid. Nonetheless, there isn’t a federal regulation for the product that activists say is dangerous and acts as a gateway to tobacco.
In a submitting to a Delhi court docket that’s listening to a plea to manage e-cigarettes, the federal well being ministry in April described such Digital Nicotine Supply Methods (ENDS) as “new rising threats”.
The ministry, in its submitting seen by Reuters, mentioned it was growing pointers for regulating – together with probably banning – the manufacture, import or sale of e-cigarettes.
“Glamorizing advertising methods of ENDS as much less dangerous merchandise purely mimics the advertising methods utilized by the cigarette business,” the ministry mentioned, with out particularly mentioning heat-not-burn smoking units corresponding to iQOS.
Regardless of that stance, the federal government supply mentioned the well being ministry was nonetheless undecided on whether or not to ban or regulate e-cigarettes, and needed extra session to determine whether or not their efficacy as an support to assist individuals quit smoking common cigarettes outweighed any potential hurt.
Globally, Philip Morris additionally lobbies regulators to not classify iQOS as a daily cigarette, an argument that, if gained, can result in decrease taxes. The corporate says the tobacco plugs inserted into the iQOS don’t produce smoke, and the gadget itself is an digital product.
It plans to do the identical in India.
“The very first thing is to make sure the customs duties are usually not prohibitively excessive,” mentioned one of many sources.