Marlboro maker Philip Morris bets on heated tobacco product as ‘better alternative’ amid switch away from cigarettes

With the launch of its heated tobacco product IQOS, Philip Morris International, the industry giant behind brands such as Marlboro and Parliament cigarettes, is betting that the global population of a billion smokers will not shrink any time soon.

In fact, the industry is expected to grow to US$1.1 trillion in the next five years, and the company wants to ready itself for the disruption alternatives to cigarettes will bring with them. The mantra behind IQOS is “If you don’t smoke, don’t start. If you can’t quit, switch”.

“We are putting ourselves in a position to move out of the mainstream cigarette business, and disrupting and transforming ourselves is a big challenge to take on. But the switch to heated tobacco is just common sense and corresponds to what the consumer wants – a less harmful alternative,” said Paul Riley, Philip Morris’s president for East Asia and Australia.

According to the company, heating tobacco at 350 degrees Celsius (662 degrees Fahrenheit) lowers by 95 per cent on average the release of harmful chemicals such as benzene, arsenic and formaldehyde, which are linked to diseases such as lung cancer and cardiovascular disease, among others. The tobacco in a cigarette burns at temperatures exceeding 600 degrees, generating smoke that contains high levels of these harmful chemicals.

In Asia, the company has launched IQOS in four markets – Japan, South Korea, New Zealand and Malaysia. After a successful launch in Japan, where IQOS was introduced in 2015 and helped grow Philip Morris’s market share by 10 percentage points to 34 per cent in four years, Riley said he was looking to convert at least half of the company’s market share in each country over to the heated tobacco product.

“Our goal for this region is to stop selling cigarettes one day, as we have done all the research to show that there is better alternative,” he said.