Philip Morris CEO: Smokeless ‘transformation’ for the company is like no other
Philip Morris International’s top executive on Friday outlined the steps the company is taking to wean itself off of traditional cigarettes, coming days after the firm obtained federal approval to sell its new tobacco heating device in the U.S.
CEO André Calantzopoulos, speaking at an event at the Boston College Chief Executives Club, outlined how the company is moving to a future without cigarettes, including investing more than $6 billion in alternatives like its IQOS. The product heats tobacco instead of burning it – technology that Philip Morris argues cuts back on toxic chemicals, leading to a safer smoking experience.
“We want to help the world unsmoke. It’s that simple,” he told attendees, according to prepared remarks. "We are essentially disrupting our business from the inside out. I can’t think of any other business that has attempted such a transformation before. Certainly no other tobacco company.”
Companies like Phillip Morris and Juul say their products can help adult smokers transition to healthier alternatives. Critics say they are simply trying to get customers hooked on other products outside of combustible cigarettes as the number of individuals who smoke continues to decline.
The Food and Drug Administration has tried to balance between both arguments, raising concerns over the increasing usage of e-cigarettes in younger populations but recognizing that the technology could be a benefit when compared to traditional cigarettes.
Calantzopoulos was defiant products like IQOS are healthier and called on state regulators and health care professionals to educate smokers on the benefits of the new wave of tobacco products.
“For those that smoke, quitting tobacco and nicotine altogether is always the best choice—but the reality is that not everyone will quit,” he said. “This reality must be met with an ambitious effort to unsmoke the world—to offer help to smokers who do not quit by making less-harmful products available.”
| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| PM | PHILIP MORRIS INTERNATIONAL INC. | 99.67 | +0.22 | +0.22% |
In response to critics who want Philip Morris to quit selling cigarettes, Calantzopoulos said “the better question is: ‘When will people stop buying cigarettes.’”
“Can you imagine if the government were to ask the auto industry to scrap the combustion engine overnight?” he told attendees. “We are no different: We will stop selling cigarettes much sooner if the regulatory bodies and healthcare stakeholders support a harm reduction vision that is pragmatic and realistic.”
CLICK HERE TO GET THE FOX BUSINESS APP
Philip Morris International will begin selling its IQOS device in Atlanta through a licensing deal with Altria, which owns Philip Morris USA. As part of the FDA approval for the product, the agency said it will monitor how it is marketed and youth usage.
Altria says it plans to "test a range of marketing, sales and consumer engagement approaches" to raise awareness of the product, "all while taking steps to minimize reach to unintended audiences, consistent with the FDA order and marketing requirements.”
The agency is still reviewing whether the IQOS is safer than combustible cigarettes.