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Boom year in Italy as vaping population triples

http://ecigintelligence.com/boom-year-in-italy-as-vaping-population-triples/

Italy’s vaping population has more than tripled in the past year, bringing the number of e-cigarette users back to the levels of 2013, before the 2014 crash. The Italian market is estimated for 2016 at €295m, a growth of 300% over the previous year. And the trend, according to the latest ECigIntelligence market report, is set to continue with still greater numbers of users in 2017.

One reason for this could be the decrease in prices of several e-cigs products this year – in some categories, a drop of between 24% and 44%. At the same time, the price of traditional tobacco cigarettes has risen.

The industry is optimistic too about future regulation and the implementation of the EU Tobacco Products Directive (TDP). There are currently 1,107 vape stores in Italy and EcigIntelligence expects more to be opened in large urban areas.

Minimal restrictions after TPD

The TDP came into force in Italy in May 2016. Rome imposed minimum restrictions on the industry and the country is one of the most permissive in or outside Europe, according to the most recent ECigIntelligence regulatory report.

Although restrictions have been placed on packaging, and cross-border distance sales – since May it is prohibited to buy e-cig products from companies not established in Italy – advertising is permitted, with certain stipulations, such as the requirement to state that nicotine is addictive.

What This Means: The e-cig industry in Italy has reacted extremely positively to the new TPD regime, with a boom in the number of vapers and vape stores matching the increased visibility of the sector. Though recent rises in tax on traditional tobacco products provide an incentive for smokers to switch to vaping, taxation remains a major concern for the e-cig industry.

3 Key Markets for Philip Morris International

The tobacco company does business around the world, but some of its markets are more important than others.

http://www.fool.com/investing/2016/09/26/3-key-markets-for-philip-morris-international.aspx

Cigarette maker Philip Morris International (NYSE:PM) has built a truly global business, serving customers on six continents. Yet some of the nations in which Philip Morris sells its cigarettes and other tobacco products are more important to the company’s overall success than others, and investors need to watch those markets particularly closely to make sure that they catch any potential changes that could help or hurt the company. Below, we’ll look at three key markets for Philip Morris to see how they’ve fared recently.

1. Indonesia

Indonesia has one of the largest overall cigarette markets of any country that Philip Morris serves, and unlike many areas of the world, that market is growing. In the second quarter of 2016, Philip Morris estimated the size of the total cigarette market at 83.6 billion units, up 5 billion in just the past year. For its part, Philip Morris shipped more than 28.5 billion units to Indonesia during the quarter, claiming about a third of the overall market with brands like Sampoerna and Dji Sam Soe. In particular, Philip Morris has had success with what it calls the Whites segment, claiming four-fifths of the market in that category. The key Machine-Made Kretek market, which makes up about three-fourths of Indonesia’s total market, has been less successful for Philip Morris, but the company still claims about 30% of that segment.

Indonesia has suffered from a sluggish economic environment lately, and Philip Morris has seen its market share fall by a full percentage point over the past year. Gains in the size of the market were largely due to the timing of the Ramadan period compared to last year’s second quarter, and Philip Morris expects long-term trends to be closer to flat. Nevertheless, Indonesia’s sheer size will make it an important market for Philip Morris to target going forward.

2. Russia

Russia also has a strong culture of smoking, and its size makes it an essential element of Philip Morris International’s overall strategic vision. The Russian cigarette market sold about 72.1 billion units in the second quarter, and Philip Morris was responsible for 20.5 billion of them, climbing market share of 27%.

Oddly enough, though, Russia is one area in which the Marlboro brand has been almost inconsequential. Marlboro has a market share of just 1.4%, compared to 8% for Bond Street and 3.9% for Parliament. Other brands, which include L&M, Chesterfield, Optima, and Next/Dubliss, were collectively responsible for more than half of Philip Morris sales in Russia.

Troubling for Philip Morris is that the Russian cigarette market is shrinking quickly, posting a nearly 7% year-over-year drop compared to last year’s second quarter. The price increases that Philip Morris has implemented to try to offset falling volume have resulted in a hit to market share, and the company will have to balance competitive pressure against its desire for higher profit in order to get the most from the nation.

3. Italy

By contrast, Philip Morris’ markets in the European Union are relatively small. Yet the EU is an essential component of Philip Morris’ success because of the company’s ability to squeeze higher profit margin from many countries there.
As an example, in the second quarter, Philip Morris’ sales in the EU and in Asia were roughly the same, but EU operating company income of $1.07 billion was more than $320 million higher than the corresponding figure in Asia.

Within the EU, Italy stands out. The Italian cigarette market sold only about 18.7 billion units in the second quarter, but Philip Morris was responsible for more than half of them, at 10.1 billion. Marlboro had market share of nearly a fourth all by itself, and the Chesterfield and Philip Morris brands were responsible for another 20 percentage points of share.

The good news for Philip Morris in Italy is that efforts to reduce the level of illegal trade in cigarettes has paid off somewhat. With the new PMI Impact campaign, Philip Morris hopes to engage a broader set of interested parties to fight smuggling, and the likely result is potential further gains in legitimate sales volumes of its tobacco products. Investors should watch results in Italy closely for additional signs of success on the illicit trade front.

Philip Morris wants to serve the whole world, and it will continue to reach out to customers everywhere it can find them. These three countries will be especially important for Philip Morris in its efforts to capture as much growth as possible going forward.

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E-cigs seen to benefit smokers

http://www.thestandard.com.hk/section-news.php?id=168341&story_id=46478558&con_type=1&d_str=20160415&sid=4

Electronic cigarettes may benefit public health, an Italian medical professor says, as they drive smokers away from more harmful cigarettes.

University of Catania’s Institute for Internal Medicine and Clinical Immunology director Riccardo Polosa said it will be “irresponsible” to ignore academic reviews that show e-cigarettes help smokers quit.

“E-cigarettes have been a gateway away from the harmful effects of smoking for millions of smokers around the world. I can’t see any reason why this cannot be the case in Hong Kong,” said Polosa, who is visiting the SAR.

Polosa, a specialist in respiratory diseases, quoted figures from Public Health England which show e-cigarette use is around 95 percent less harmful to health than smoking.

The same figures were criticized last year after the Guardian newspaper reported PHE had taken the data from a separate study, co-authored by Polosa, which was sponsored by those with links to the tobacco industry. Polosa is also an adviser for Italian anti-smoking organization Lega Italiana Anti Fumo, which helped fund the study.

Undersecretary for Food and Health Sophia Chan Siu-chee last month said the government is considering banning the import, manufacture, sale, distribution and advertising of e-cigarettes.

The Hong Kong Council On Smoking And Health is also calling for a complete ban.

“Less harmful does not mean zero harm,” Antonio Kwong Cho-shing, chairman of the anti- smoking council, told The Standard. “If e-cigarettes are harmful, they should be banned.”

Baptist University research shows several e-cigarettes contain harmful chemicals including formaldehyde and poly-brominated diphenyl ethers, he said.

Inhalation of the latter has been associated with a reduction in fertility, affecting fetal development and can cause cancers.

Meanwhile, the government has extended the smoking ban to eight bus interchanges at tunnel portal areas including Lion Rock Tunnel Bus Interchange.

Italy cracks down on smokers as tough law takes effect

Health officials and consumer groups estimate that smoking causes some 80,000 deaths a year in Italy.

http://www.reuters.com/article/us-health-italy-smoking-idUSKCN0VB1I3

Tough anti-smoking laws came into effect in Italy on Tuesday, imposing large fines for several offences and making it illegal to smoke in a car carrying children or pregnant women.

The laws require cigarette packs to carry stark pictures of people who suffered from the effects of smoking, including one of a woman coughing up blood and another of a man who died of a heart attack being zipped up in a body bag.

Those caught smoking in cars with children or pregnant women risk fines of up to 500 euros ($546). Smoking will also be prohibited outdoors near schools and hospitals. Tobacconists caught selling cigarettes to minors risk fines of up to 3,000 euros or losing their license.

Throwing cigarette butts on the pavement could cost an offender up to 300 euros.

The laws were passed in 2015 in response to an EU directive requiring member states to toughen smoking laws. Health officials and consumer groups estimate that smoking causes some 80,000 deaths a year in Italy.

Smokers in Italy Hit With New Fines to Protect the Young

http://www.usnews.com/news/world/articles/2016-02-02/smokers-in-italy-hit-with-new-fines-to-protect-the-young

ROME (AP) — Smokers in Italy are now facing fines of up to 500 euros ($600) if they light up in a car with a child or pregnant woman — or if they toss a cigarette butt on the street — after new health and environmental laws went into effect Tuesday.

The smoking prohibitions extend bans on smoking in offices, restaurants, cinemas and other public places to the more private sphere of a car. They also specifically target pediatric hospitals and other medical facilities catering to pregnant women and newborns in a bid to cut the estimated 70,000-83,000 deaths a year the government attributes to tobacco smoke.

The measures are contained in a new law conforming to EU regulations aimed at dissuading young people from taking up the habit. They impose hefty fines on shopkeepers who sell to minors and cigarette producers who market to them, and include new requirements for warnings on cigarette packages.

The separate law against tossing cigarette butts is part of an anti-littler regulation that also punishes spitting out gum or tossing shopping receipts on the street.

Piergiorgio Benvenuti, president of EcoItalia Solidale, said about 11 million cigarettes are smoked every day in Rome, half of them squished on the street, where they often get trapped between cobblestones.

“This has an enormous environmental impact,” he said, noting that it takes between five to 12 years for a cigarette to break down. “Aside from how it looks is how much it costs Rome to clean this up.”

Roberta Pacifici, director of the smoking, drug and alcohol department of the Superior Institute of Health, said she expected the new measures would lead to a new drop in smoking rates across Italy, as occurred when the first bans were introduced.

The smoking bans in cars will “have a great educational value” for young people, she said.

Stefan Mihailovic, a 21-year-old student at Rome’s John Cabot University, praised the initiative though he acknowledged the fines will hurt.

“I think it can only be good because it can only clean up the city, which is quite dirty. It can only be good.”

E-cigarettes: Mixing Research and Marketing

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Has the traditional cigarette burned out?

http://www.cnbc.com/2015/09/07/

The chief executive of Philip Morris told CNBC he wants their lines of e-cigarettes eventually to outsell traditional smokes.

Speaking on the sidelines of the European House-Ambrosetti Forum in Italy, CEO Andre Calantzopoulos told CNBC that he was very optimistic about the take-up of iQOS — a Marlboro-branded device that electronically heats, rather than burns, tobacco and differs from the broader range of “e-cigarette” that use nicotine and water vapor to simulate the smoking experience.

“Our objective and my personal ambition is that these reduced-risk products will overtake combustible cigarettes as soon as possible. And that’s clearly what we’re pursuing,” Calantzopoulos told CNBC.

He hopes cigarette alternatives will account for at least 15 percent of the company’s portfolio in five to 10 years, adding that was his conservative estimate.

But reaching those levels will require regulatory help, Calantzopoulos explained.

“These products have to be regulated — in their way of being developed, risk assessed and marketed — because we need to provide consumers with very clear, and not misleading, information about the benefits of the product, but also [to communicate] that they’re not zero risk products,” Calantzopoulos told CNBC.

Philip Morris has started clinical trials similar to those deployed by the pharmaceutical industry, to assess the risk profiles of alternatives like iQos, and these trials will be essential to combat a recent backlash against e-cigarettes, Calantzopoulos said.

“Voices say these products are more dangerous than cigarettes. Personally, I think this is rather irresponsible,” he explained.

The latest World Health Organization (WHO) report on e-cigarettes explains that most products haven’t been tested by independent scientists, and that the limited amount of testing that has taken place so far shows “wide variations” around toxicity levels.

However, the WHO said it is “very likely” that there is a lower toxic exposure from e-cigarettes than traditional combustible smokes.

For the time being, Calantzopolous said he was excited about the technology that was providing an industry-wide transformation.

“It’ s a very exciting moment actually

Demographic characteristics, nicotine dependence, and motivation to quit as possible determinants of smoking behaviors and acceptability of shocking warnings in Italy

http://www.ncbi.nlm.nih.gov/pubmed/24900980

Abstract

INTRODUCTION:

This paper presents the final results of a cross-sectional study started in 2010. It compares the perceived efficacy of different types of tobacco health warning (texts versus shocking pictures) to quit or reduce tobacco use.

METHODS:

The study conducted between 2010 and 2012 in Italy enrolled adults smokers. Administering a questionnaire demographic data, smokers behaviors were collected. Showing text and graphic warnings (the corpse of a smoker, diseased lungs, etc.) the most perceived efficacy to reduce tobacco consumption or to encourage was quit.

RESULTS:

666 subjects were interviewed; 6% of responders referred that they stopped smoking at least one month due to the textual warnings. The 81% of the smokers perceived that the warnings with shocking pictures are more effective in reducing/quitting tobacco consumption than text-only warnings. The younger group (<45 years), who are more motivated to quit (Mondor’s score ≥ 12), and females showed a higher effectiveness of shocking warnings to reduce tobacco consumption of, 76%, 78%, and 43%, respectively with P < 0.05.

CONCLUSIONS:

This study suggests that pictorial warnings on cigarette packages are more likely to be noticed and rated as effective by Italian smokers. Female and younger smokers appear to be more involved by shock images. The jarring warnings also appear to be supporting those who want to quit smoking. This type of supportive information in Italy may become increasingly important for helping smokers to change their behavior.

How would plain packaging and pictorial warning impact on smoking reduction, cessation and initiation?

http://www.ncbi.nlm.nih.gov/pubmed/24548838

Abstract

The European Commission has proposed a review of the directive on tobacco products on labeling and packaging of tobacco products by introducing warning text with pictorial warning that occupies 75% of the cigarette packages. The aim of the survey was to assess the impact of plain packaging and pictorial warning in smoking reduction, cessation and initiation among a sample of adult. The cross-sectional study was conducted in Rome between September and November 2012. The questionnaires administered were 227, with a response rate of 82.4%. 35.8% (No. 67) of the respondents considered the image of the gangrene the most effective in communicating smoking-related damages, followed by the image on lung cancer (No. 60; 32.1%). Distinguishing between smokers and non-smokers (both former and never smokers), the picture on lung cancer was the most effective for smokers (No. 22; 38.6%); if cigarette packages have pictorial warnings like the ones shown, more than half (No. 33; 57.9%) of smokers would change brand; 66.7% (No. 38) of them would feel uncomfortable in showing the package. Comparing the 3 packagings, classic packaging, plain packaging with textual warning, and plain packaging with both textual and pictorial warning, the majority of people declared that the third is the most effective in preventing smoking initiation (No. 169; 90.9%), in motivating to quit (No. 158; 84.9%), and in changing smoking habits (No. 149; 80.5%). The survey, although its small sample size and being not representative of all strata of Italian population, shows that the plain packaging with pictorial warning is the most convincing in the three outcomes considered.