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May 15th, 2015:

Tax increases don’t need to wait for the Illicit Trade Protocol

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Now is the best time to raise taxes on tobacco

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China Shames Excessive Smoking in Latest Films

May 14, 2015

Kiki Liu

China’s New Year blockbuster “Gone With The Bullets” was given an award of shame for excessive smoking as part of the country’s latest anti-tobacco campaign.

The Chinese Association on Tobacco Control announced the “Dirty Ashtray Award” as it disclosed the results for an annual smoking scene review of films and television series.

The film by director Jiang Wen has 45 smoking scenes, the highest of all other films, showing one every 3.1 minutes. It contended with 30 of the most popular films over the past year, said Xu Guihua, deputy director of the association. Nine films and television series were given “No Smoking Scene Awards”.

The association has been monitoring smoking scenes in popular films and television series in China since 2007 to encourage celebrities to take more social responsibilities not to expose too many smoking scenes in their works to prevent the minors from mimicking.

As the world’s largest tobacco maker and consumer, China has more than 300 million smokers, almost the size of the U.S. population, and another 740 million people are exposed to second-hand smoke each year.

According to official data, over one million Chinese people die from smoking-related diseases annually.

The country is adopting its strictest measures in the latest tobacco-control efforts.

Apart from shame awards, China’s top legislature in April adopted an amendment to the Advertisement Law, banning tobacco advertising on mass media, in public places, public vehicles and outdoors.

The consumption tax on cigarettes at the wholesale level was raised on May 10, a move expected to cut cigarette consumption by four to five percent and add 100 billion yuan to annual tax revenue.

Meanwhile, Beijing will pilot the country’s toughest smoking ban starting June 1, prohibiting smoking in all indoor public places, workplaces, and on public transportation.

But despite multiple efforts, experts say challenges are still in the way.

Wang Chaocai, an official of the Ministry of Finance, said prices of the cigarettes are determined by the market. Whether the tax raise will entirely be passed on to retail prices is still unknown.

A shop owner at the Communication University of China in Beijing, said, cigarette prices in his shop have grown by one yuan per package on average after the price hike. “The sales have not been affected yet. Most of my customers are nearby residents and college students. It seems that they would not pay much attention to the slight rise of cigarette prices.”

Liu Rongjun, a 21-years-old student at the university, said, “The price of the cigarette I used to buy has grown by over one yuan per package, but the prices for some brands have remained unchanged. I would choose some cheaper ones after the price rise.”

Zhang Guodong, columnist of economic news portal www.ce.cn, said rising retail price of cigarettes will have a limited deterring effect on chain smokers.

Despite rising cigarette tax and price, it is even more important for the local governments to cut the scale of the tobacco industry and reduce their dependence on tobacco companies for revenue.

Additionally, doubts about the feasibility of Beijing’s new smoking ban have been climbing as smokers are still seen puffing away in restaurants, schools and other public spaces in the city, regardless of previous smoking bans.

Liu said, “I don’t think the ban will have much to do with me. Mostly I smoke in entertainment venues, bars for example. It will be hard to actually implement the ban in such places which usually lack effective supervision.”

Xu said, “We have made secret investigations in some bars and found that the managers are unaware of the new regulations. More publicity and promotions about the ban are needed.

“After the ban takes effect, the city’s law enforcement still needs to work out ways to implement the regulations to the letter and make the smokers who defy the ban get due punishment.”

Wu Yiqun, executive vice director of ThinkTank, a Beijing-based anti-smoking advocacy group, said, effective implementation of the regulations should be based on solid public support.

It is important for the government to heighten public awareness of the harm of smoking and invite the public to supervise the law enforcement activities, he said.

(Source: Xinhua)

http://www.womenofchina.cn/womenofchina/html1/news/china/1505/1200-1.htm

Cigarette industry: ‘FBR should tie revenue projections to market share’

http://www.brecorder.com/taxation/181:pakistan/1186365:cigarette-industry-fbr-should-tie-revenue-projections-to-market-share/

A leading cigarette manufacturer Thursday conveyed to the Federal Board of Revenue (FBR) that revenue projections for documented industry for 2015-16 should be set taking into account expansion of market share, up to 24 percent of informal sector, which consist of counterfeit and non-duty paid cigarette from KP and Azad Kashmir.

Sources told Business Recorder here on Thursday that officials of a cigarette manufacturing unit met the tax authorities at the FBR House to discuss the revenue implications of the illicit and counterfeit cigarette. The projections of sales tax and Federal excise Duty (FED) revenue for 2015-16 should be set for the cigarette industry duly taking into account the facts and figures of counterfeit and non-duty paid cigarettes coming from KP and Azad Kashmir. They opined that loss of the company has increased in 2014-15 due to presence of counterfeit and non-duty paid cigarette of KP and Azad Kashmir.

Tax authorities were informed that 24 percent of the market share has been captured by the cigarette manufactures of KP and Azad Kashmir. Resultantly, the loss of the company is increasing day by day due to presence of such informal sector operating in KP and Azad Kashmir. They further informed the market share of the documented industry is shrinking, resulting in revenue loss from the said sector. Meanwhile, Minister (Trade), Washington D.C., Embassy of Pakistan, USA has informed the FBR that he recently held a meeting with the Vice President, Phillip Morris International, wherein, the organisation showed its interest in increasing their portfolio by investing a fresh $100 million in Pakistan, besides, looking to work with the Government of Pakistan in curbing illegal tobacco trade.

A report on illicit trade in tobacco products in Pakistan shared by Phillip Morris with the FBR revealed that two manufacturers contribute over 99 percent or Rs 85 billion ($850 million) of excise and sales taxes collected from this sector, based on the legal volume of 62.7 billion sticks. The tobacco industry is the largest contributor to Pakistan’s Excise tax base.

The magnitude of the illicit trade revealed that there are three sets of independent references available to measure the volume and incidence of illicit trade in Pakistan, namely Nielsen, Oxford economics and Euro-monitor. The ITIC & Oxford Economics (OE) Asia-14: Illicit Tobacco Indicator 2013 report – a pan-Asia study, indicates that nearly 1 out of every 4 cigarettes consumed in Pakistan is illicit. The volume of illicit cigarette consumed in Pakistan is the third largest in the region at around 19 billion cigarettes. This represents more than the total legal sales in Malaysia and Singapore combined. Furthermore, the loss to government revenue in fiscal year 2013/2014 is estimated at Rs 26.2 billion ($253 million), Phillip Morris said. Looking at trends, the Nielsen monthly retail trade audit shows a steady increase of illicit cigarettes sold in Pakistan over the past five years.

Finally, the recent passport report issued by Euromonitor estimates that the incidence of illicit cigarette consumption has regularly increased in the past five years to reach 31.1 percent of the total consumption, ie nearly 1 cigarette out of 3 cigarettes consumed:

Further, according to Euromonitor International, “The Pakistani government reportedly lost $275 million in fiscal year 2012-2013 in potential taxes as a result of illicit tobacco trade. The amount is 17 percent of the country’s current account deficit, which stood at $1.58 billion in the first six months of full year 2014″. The nature of the issue is that the consumption of illicit cigarettes is, in its vast majority, composed of domestic illicit cigarettes (under-declaration): These are cigarettes produced to be illegally sold and consumed in the domestic market. In Pakistan, the under-declaration of manufacturing volumes is carried out by small local manufacturers who, by doing so, evade the payment of the excise duty and the sales tax, thereby allowing them to price their cigarettes below the minimum legal price (Rs 42 per pack of 20 cigarettes), it said.

Non-Domestic Illicit cigarettes (counterfeit /contraband/smuggling): These illicit cigarettes are commonly illegally imported through the porous borders of Pakistan with Afghanistan. In Pakistan, the presence of counterfeit cigarettes is not deemed material, as opposed to contraband/smuggled cigarettes.

The various studies conducted by Nielsen, ITIC/Oxford Economics and Euro monitor indicate that locally manufactured cigarette evading taxes account for 80 to 85 percent of the total illicit consumption volume, or approximately 20 billion cigarettes in Pakistan. Aside from BAT’s and PMI’s local affiliates, there are more than 21 registered companies in Pakistan but the bulk of the domestic illicit volume comes from certain companies.

PMI said that the local manufacturers are mostly based in the Mardan area (Khyber Pakhtunkhawa province) some also have operations in the territory of Azad Jammu & Kashmir.

Based on the information available with Nielsen, Oxford Economics and Euro Monitor; the second component of the illicit cigarette consumption (smuggled cigarettes) accounts for approximately 15-20 percent of the total illicit volume of approximately 20 billion cigarettes in Pakistan. As indicated in the Retail Trade Audit and the Empty Pack Survey, the main Non-Domestic Illicit brand is a trademark. Based on Nielsen retail audit, Pine is 40 percent (759 million cigarettes) of the total smuggled component of illicit in Pakistan.

Reportedly, a common route to smuggle all sorts of illicit goods into Pakistan is via the port of Bander Abbas in Iran, followed by road transit towards Afghanistan from where a wide variety of illicit goods are then smuggled into Pakistan via the two main border-crossing points of Torkham and Chaman. A popular illicit brand appears to be smuggled via this route too. The illicit cigarettes are fairly ‘openly’ transported across the country, illustrating lack of enforcement and deterrence, Phillip Morris added.

Women’s Organization Establishes China’s 1st No-Smoking Community

May 12, 2015

Lin Zhiwen and Chen Hongmei

A women’s organization has helped most tobacco users in Huangwai Community, Zhanjiang City in south China’s Guangdong Province, quit smoking and turned the community into the country’s first smoking-free village.

Since May 2013, Women’s Home, an organization affiliated to the local women’s federations, has urged female residents to help tobacco users quit smoking and ask their husbands to sign no-smoking agreements.”

It was a tough task, given that more than 800 out of its 1,300 residents were tobacco users.

During the campaign, female residents of the village gathered their smoking pipes and destroyed them on voluntary basis.

To better promote the building of a smoke-free community, “Women’s Home” proposed to establish a smoking surveillance team consisting of women members.

The proposal was warmly received and over 30 elderly women joined the group.

For those they found smoking in the community, the team asked them to do cleaning jobs in the public areas of the community and for those who quit smoking and gave up for more than a year, they hand out rewards.

At the entrance to the village, the team erected a plaque, saying “Smoking-free Community” and posted no-smoking signs in public areas.

In addition to routine surveillance, the team goes around the village to see whether there are people smoking in public areas and they are also open to complaints about smoking in households.

“The community’s call for residents to quit smoking is appreciated most by women,” said a team member, who gave a successful example of her husband quitting smoking.

“When my husband quit smoking, my father-in-law also gave up,” she said. “Now, no one coughs because of smoking in my family. It is good for my two children who are growing up.”

The initiative to build a smoking-free community is one of the measures of the “Women’s Home” in Huangwai to encourage women to “hold up half the sky”, as in the famous 20th century Chinese phrase.

Li Yingmei, director of the community’s Women’s Congress, said that the campaign was a measure to empower women, and that “Women’s Home” leads women to participate in the management of the affairs of the community.

Currently, “Women’s Home” has an office and large recreation center of around 180 square meters. In addition to the anti-smoking team, it has established cooperatives as well as exercise, volunteer and cleaning attendant teams.

http://www.womenofchina.cn/womenofchina/html1/news/action/1505/1061-1.htm

WHO releases preliminary assessment of China’s tobacco tax increase

BEIJING, 15 May 2015 – The World Health Organization (WHO) today released its preliminary assessment of the impact of the increase to tobacco taxation announced by China’s Ministry of Finance on 8 May.

“Increasing tobacco taxes and prices is the single most effective way of reducing tobacco consumption in the short term. The WHO therefore welcomes the announcement by the Ministry of Finance of a tobacco tax increase in China,” said Dr Bernhard Schwartländer, WHO Representative in China.

“We are especially pleased to see that the new tax policy establishes the important precedent that tobacco tax increases should be passed on to the retail price of cigarettes, in order to reduce tobacco consumption for public health purposes,” Dr Schwartländer said.

Summary of changes

The tax increase announced by the Ministry of Finance last week and which came into effect on May 10 includes two components:

· an increase in the excise tax applied at the wholesale level, from 5% to 11%;

· a new, specific excise tax of 0.005RMB per stick, or 0.1RMB per pack of 20 cigarettes.
WHO’s preliminary assessment of the new policy

WHO has conducted preliminary modelling on the tax increase in conjunction with Professor Rose Zheng, at the WHO Collaborating Centre on Tobacco Control and Economics at the University of International Business and Economics in Beijing.

According to our preliminary analysis, the tax increase will lead cigarette retail prices to increase on average by between 7-10%, with the cheapest brands likely to increase the most.

For instance, the price of a pack of cigarettes which currently retails for 5 RMB could increase to around 5.5 RMB.

As a result of the changes, the share of excise tax as a proportion of the market average retail price of tobacco products is expected to increase from 30% to 34%.

The overall share of tax as a proportion of the market retail price of tobacco – including excise, Value-Added Tax (VAT) and other taxes – is likely to increase from 50% to approximately 54%.

WHO expects that increases in the retail price of 7-10% will have a modest but measurable impact on reducing total cigarette consumption, most notably with respect to the cheapest brands in the market which encourage use and uptake by vulnerable populations – such as young people and people on very low incomes.

However, it will be some time before the real impact of the tax increase can be determined – in particular, the impact on consumption. There are a range of variables which may affect this, for instance – the wide variation in cigarette prices in China.

Cigarette prices are still low by international standards and household incomes in China are growing strongly. This means that cigarettes will become more affordable over time unless regular tax increases are introduced by the Government.

WHO will continue to monitor the impact of the tax changes, in particular on retail prices.

“Right now, around 12% of all adult deaths in China are caused by smoking. This takes a heavy toll on China’s health system, and on the broader society and economy. High health costs fall most heavily on the poor, who can least afford to pay. This can lead to a vicious cycle of impoverishment,” Dr Schwartländer said.

“By raising tobacco taxes, the Chinese Government can reduce these costs, raise additional reveue, and improve public health – particularly amongst the poor: a classic ‘win-win’ policy,” Dr Schwartländer said.

“Even a marginal decrease in the smoking rate in China would mean millions fewer smokers, who will avoid the diseases and early death that comes with smoking. There is a direct link between the price of tobacco products and the level of consumption: in other words, the higher the price, the more lives that will be saved,” Dr Schwartländer concluded.

For more information, please go to the WHO China website: http://www.wpro.who.int/china/en/ or follow WHO on Weibo: http://www.weibo.com/whoinchina .

About the World Health Organization

WHO is the directing and coordinating authority for health within the United Nations system. It is responsible for providing leadership on global health matters, shaping the health research agenda, setting norms and standards, articulating evidence-based policy options, providing technical support to countries and monitoring and assessing health trends.

For more information please contact

Ms WU Linlin
WHO China Office
E-mail: wul@who.int
Office Tel: +86 10 6532 7191

世卫组织新闻通稿

世界卫生组织发布对中国提高烟草税政策的初步评估

北京,2015年5月15日——世界卫生组织(世卫组织)今天发布了对中国财政部5月8日宣布的提税政策相关影响的初步评估结果。

“提高烟草税和价格是短期内降低烟草消费的最有效办法。因此,世界卫生组织非常欢迎财政部提高中国烟草税的决定,”世界卫生组织驻华代表施贺德博士表示。

“我们非常乐意看到新的税收政策开创了一个重要先河,即,提高的税率应该体现在卷烟零售价中。惟有这样才能降低烟草消费,促进公共卫生目标的实现。”

政策调整简介

上周财政部宣布提高烟草税并从5月10日开始执行。提税主要包括两项内容:

· 将卷烟批发环节从价税税率由5%提高至11%;

· 按0.005元/支加征从量税,相当于1包20支的卷烟加征0.1元从量税。

世卫组织对新政策的初步评估

世卫组织与对外经济贸易大学世界卫生组织烟草控制经济学合作中心的郑榕教授合作,对提税政策进行了初步模型分析。

初步分析显示,提税将使卷烟零售价平均上涨7-10%之间,低端品牌涨幅有可能最大。

举例说明:目前零售价为5元一包的卷烟,提税后将涨价到5.5元一包。

受其影响,消费税在烟草平均零售价中的占比将从30%上涨至34%。

各种税收(包括消费税、从价税和其他税)之和在烟草零售价中的占比有可能从50%上涨到54%左右。

世卫组织认为,卷烟零售价上涨7-10%对于降低总体卷烟消费将会产生适度但仍可测量到的影响,其中,以对吸引年轻人或低收入者等薄弱人群吸烟的低价品牌的影响较为明显。

然而,须假以时日,提税的实际效果(尤其是对烟草消费的影响)才能显示出来。此外,还有其他一些影响因素,例如,中国的卷烟价格差别巨大。

从国际标准来看,中国的卷烟价格仍较低,而中国的家庭收入正在不断增加。也就是说,如果政府不定期提税,人们对卷烟的负担能力将日益提高。

世卫组织将继续监测提税的效果,特别是对零售价格的影响。

“目前,中国约12%的成人死亡是由吸烟引起的,给中国卫生系统以及整个社会和经济带来了沉重负担。支付能力最低的贫困人群是高医疗费用的主要承受者,可能因此而落入因病致贫的恶性循环,”施博士表示。

“通过提高烟草税,中国政府可以减少上述损失,增加收入,改善人民健康,尤其是贫困人群的健康。这是典型的双赢政策,”施博士说。

施博士最后表示:“中国的吸烟率即使只是略有下降,都意味着减少了数百万的吸烟者,他们将因此避免了吸烟导致的疾病和死亡。烟草制品价格直接关系到烟草消费水平;换言之,价格越高,将有越多人的生命得到挽救。”
获取更多信息,请访问世卫组织驻华代表处网站:http://www.wpro.who.int/china/zh/ 或关注世界卫生组织微博:http://www.weibo.com/whoinchina 。

关于世界卫生组织

世卫组织是联合国系统内的卫生指导与协调机构,负责在全球卫生健康相关工作中发挥领导作用,制定卫生健康研究议程,设立规范及标准,阐述循证的政策备选方案,向各国提供技术支持,以及监控和评估卫生健康趋势。

更多信息请垂询

吴琳琳女士
世卫组织驻华代表处

电子邮箱:wul@who.int
办公电话:+86 10 6532 7191

‘Tobacco lobbying in India undermining public health’

http://www.hindustantimes.com/world-news/tobacco-lobbying-in-india-undermining-public-health/article1-1347517.aspx

Three medical experts have cautioned that there was ‘troubling evidence’ of the tobacco industry influencing governments in India and other countries in Asia, which is underming public health.

In a paper in the latest issue of the ‘British Medical Journal’, British experts Nicholas S Hopkinson Martin McKee, and K Srinath Reddy of the Public Health Foundation of India say that some governments in Asia were complicit in protecting the interests of the tobacco industry.

The paper titled ‘Tobacco industry lobbying undermines public health in Asia’ identifies India, Pakistan and Laos where the tobacco industry was reportedly targeting control policies.

It says: “The implementation of tobacco control measures is a political choice. Although tobacco control will improve the wellbeing of the populations that governments serve, the industry spares no attempt to deter, dilute, or delay effective measures for tobacco control, be it taxation or prominent pictorial health warnings”.

“There is troubling evidence that the tobacco industry is exerting undue influence in several Asian countries, in some cases with the complicity of governments, to thwart public health measures”.

The paper recalled that in October 2014 the Indian government had announced plans to mandate the use of pictorial health warnings covering 85% of tobacco product packaging, which was to come into effect from 1 April 2015.

“However, a committee of parliamentarians that had consulted tobacco industry lobbyists successfully recommended that these plans be suspended. Although tobacco is estimated to account for 40% of all cancers in Indian men, the committee chair, Dilip Gandhi, made the extraordinary assertion that no study in India had established that tobacco causes cancer”, the paper says.

It also noted that senior Indian tax officials were reportedly listed as participants in the 12th annual Asia Pacific tax forum, to be held in Delhi, sponsored by four of the global tobacco corporations.

“Understandably, these contacts have faced vigorous opposition from the Indian public health community”, the paper says.

Pill that quashes tobacco urge found in plain sight

http://www.washingtonpost.com/business/economy/pill-promises-a-safer-cheaper-way-than-chantix-to-quit-smoking/2015/05/15/8ce5590c-f830-11e4-9030-b4732caefe81_story.html

These laburnum trees growing in vast orchards in Bulgaria could be the source of a potential new stop-smoking drug that’s being tested now in the United States. (PHOTO COURTESY OF MARIA VUCHEVA /PHOTO COURTESY OF MARIA VUCHEVA )

These laburnum trees growing in vast orchards in Bulgaria could be the source of a potential new stop-smoking drug that’s being tested now in the United States. (PHOTO COURTESY OF MARIA VUCHEVA /PHOTO COURTESY OF MARIA VUCHEVA )

Rick Stewart didn’t know about the laburnum trees growing in Bulgaria — and their potential to produce a drug for quitting smoking — back when he was the chief executive of the pharmaceutical company Amarin.

He was too deep inside the drug industry, a place often criticized for its short-sighted focus on profits. He had to fail first. Only then could he spot the opportunity in those yellow-flowering trees.

Now, with the help of the National Institutes of Health, Stewart is trying to introduce the laburnum-derived drug to the U.S. market. The pill works by interrupting tobacco cravings, much like Pfizer’s top-selling Chantix, but possibly without that drug’s high-profile side effects and at a much lower price. A recent run of positive studies have buoyed the pill’s prospects. Today, researchers are excited about what could be the first new treatment for smoking cessation to emerge in years.

“We need this,” said David Shurtleff, deputy director of the NIH Center for Complementary and Integrative Health, explaining why his agency is helping to get the drug approved.

But laburnum’s promise is not new. It was just overlooked — for decades — highlighting holes in how drugs are traditionally developed.

In 2007, Stewart had staked his job as the head of Amarin on a different drug. Miraxion was for treating Huntington’s Disease, and early on it showed signs of improving symptoms of the neurological disorder. But then the drug failed two late-stage trials. Investors in Amarin, a $240 million company based in New Jersey, were stunned. The company’s stock fell 80 percent. Stewart was out of a job.

“The CEO always falls on his sword,” Stewart, 56, says now.

But Miraxion did appear to help patients with Huntington’s — it just took longer than the six months allotted during the clinical trials. Yet the damage was done. This led Stewart and Anthony Clarke, who also lost his job after running the trials for Amarin, to wonder what other misunderstood drugs were out there. They went on a hunt.

“These drugs are uncared for or unwanted. They need tender loving care,” Stewart says. “And pharma, for whatever reason, can’t be bothered with them.”

They set up a tiny company outside London named Ricanto — a mash-up of their first names. They describe the firm’s focus as pharmaceutical asset optimization. They believed innovation was not limited to new drugs. Sometimes it’s just about rediscovering old ones.

Ricanto found a compounded drug used by a few European doctors for a rare autoimmune disorder and introduced it to a larger market. It then helped identify a treatment for severe childhood epilepsy and sold the drug rights to San Diego-based Zogenix in a $130 million deal.

In 2009, Stewart learned of the laburnum trees.

A co-worker told him about a company in Bulgaria named Sopharma that made a stop-smoking drug called Tabex. The pills contained cytisine, a natural compound found in the tree’s seeds. The drug was farmed from massive laburnum orchards in Bulgaria. Cytisine targeted brain receptors to block nicotine cravings. Its power had been recognized since at least the 1940s, when Russian soldiers in World War II, short on tobacco, reportedly turned to smoking the tree’s leaves. Some soldiers found they no longer needed cigarettes.

Sopharma began making the Tabex-branded cytisine pills in 1964, but they were available only in Central and Eastern Europe.

Stewart had never heard of the drug. But he was intrigued. He was also wary. Nearly 1 billion people smoke worldwide, according to the World Health Organization. Tobacco is blamed for 5 million deaths a year. A cheap, effective drug to help smokers quit would be huge. He wondered how others could have missed this opportunity.

There are only three treatment options for U.S. smokers looking to quit.

Chantix is the newest, debuting on the market in 2006. At the time, it was the first prescription drug approved for smoking cessation by the U.S. Food and Drug Administration in nearly a decade, since GlaxoSmithKline’s antidepressant Zyban. Aside from those two drugs, there also are the nicotine-replacement gums, lozenges and patches. But that’s it. The promise of treatments such as nicotine vaccines or other drugs had flamed out. Nothing new has come down the pike.

In 2008, Chantix (sold as Champix overseas) posted $846 million in worldwide sales. But that blockbuster number dropped 17 percent the next year when the FDA slapped a “black box” warning on Chantix and Zyban because of the risk of suicidal behaviors and other mental-health problems. Facing a wave of damaging publicity, Pfizer went on to settle 2,900 lawsuits for nearly $300 million. Chantix’s reputation is still suffering. Last year, it recorded $647 million in sales.

The risk of severe side effects alarmed Stewart.

Cytisine and Chantix work in similar ways. In fact, Pfizer chemists closely studied the plant product as they developed their synthetic drug. But Pfizer supercharged its derivative to increase efficacy. Stewart noted that Tabex had amassed a database of 5 million users in Eastern Europe without signs of Chantix-like side effects.

“Why aren’t we seeing the suicidality?” he recalls thinking.

One study suggested it was because cytisine is less potent. And many researchers today believe the worst side effects attributed to Chantix — such as suicidal thoughts — are unrelated to the drug. (A Pfizer study to be released later this year is expected by many to support this notion.) But stark differences between the two drugs are found in other severe reactions, including abnormal dreams, insomnia and nausea. These are rare for cytisine, but seen in up to 30 percent of Chantix users.

Stewart struck a deal with Sopharma. He wanted to get the drug approved in Western Europe and the United States. Instead of calling it Tabex, the pill would be named Extab.

But Stewart still faced a daunting problem with cytisine.

“There’s no money in it,” said Dr. Taylor Hays, director of the Nicotine Dependence Center at the Mayor Clinic in Rochester, Minn., who would love to see cytisine get a shot here. “And that’s what usually motivates people to try bringing it to market. The money is going to drive it.”

“It’s just frustrating to think that there’s something that could be helping people and we’re not using it,” said Dr. Nancy Rigotti, director of the Tobacco Treatment Unit at Massachusetts General Hospital.

A natural product like cytisine cannot be patented. That makes its market position harder to defend. And getting a drug approved requires millions of dollars. Drug companies say the cost of developing and getting approval for a new drug is $1 billion. This might explain why some companies have seen blockbuster profits with treatments for rare diseases, such as Genzyme’s drug for Goucher disease, which costs $300,000 a year.

“They’re fixated on patent protection and new drugs,” Stewart said.

Stewart is banking on two things to turn a profit with Extab. One is the limited cytisine supply. A competitor would need to plant vast orchards of laburnum trees — hundreds of thousands of them — and wait four years before the drug-containing seeds could be harvested.

The other thing is that Extab is new to the U.S. market. No one has ever tried to get it approved. So the drug would have five years of U.S. market exclusivity as a novel drug under the 1984 Hatch-Waxman Act. That’s less than the typical 20-year window for patented medicines. But it’s something.

“It’s a really old, novel drug,” Stewart says.

Still, he needed help getting the drug through the U.S. regulatory maze. He needed to get lucky. And he did.

British medical authorities offered to pay for and run a clinical trial of cytisine. In 2011, the findings were published in the New England Journal of Medicine, showing cytisine was 3.4 times more likely than placebo to help people quit smoking and stay that way for one year, on par with Chantix.

Then a review by University of Sheffield researchers compared cytisine with Chantix and concluded that while more investigation was needed, “Cytisine is estimated to be both more clinically effective and cost-effective than (Chantix).”

But the real turning point came in December, when another study was published in the New England Journal of Medicine. Researchers with New Zealand’s National Institute for Health Innovation found cytisine was superior to the nicotine-replacement gum or patch.

The drug now had two large-scale clinical trials under its belt.

But more work lies ahead.

“I’m either absolutely mad or I guess I really believe in it,” Stewart says.

European regulators and the FDA are considering what more they need, Stewart says.

In preparation, a lab in California recently started early-stage safety tests on Extab. The NIH is picking up the tab. The NIH’s Shurtleff said the agency wants to support promising drugs that don’t have a clear path to the marketplace, especially natural products.

“That’s where we come in and provide that capital,” he says.

It could take three to five more years for the FDA’s blessing. Stewart said he hopes to find a partner to help his small firm with the U.S. market. He also brushes off any suggestion that Extab would go head-to-head with Chantix, which is made by one of the world’s biggest drug firms. It’s a strategic move on his part.

“They’ll crush us,” he says.

Stewart estimated that Extab could see $400 million in annual sales worldwide five years after launch. Pfizer will notice that.

Currently, the cytisine supply comes from 100,000 laburnum trees planted in fields ringed by protective fences in Bulgaria. Stewart knows that will not be enough if all goes to plan — if the FDA approves, if Extab takes off. He will need to ramp up production.

He has plans to plant 300,000 more of those yellow-flowering trees, including some in the United States, orchards so large they would be impossible to miss.

Does smoking reduction worsen mental health? A comparison of two observational approaches

http://bmjopen.bmj.com/content/5/5/e007812.full?g=w_tc_open_tab

Abstract

Objectives

The association between smoking reduction and mental health is of particular interest given that many smokers report that smoking offers mental health benefits. We aimed to assess the association between smoking reduction and change in mental health using two different analytical approaches to determine if there was any evidence of an association. There were no prior hypotheses.

Design

A secondary analysis of prospective individual level patient data from 5 merged placebo-controlled randomised trials of nicotine replacement therapy for smoking reduction.

Participants

All participants were adult smokers, selected because they wanted to reduce but not stop smoking, and had smoked for at least 3 years. Participants were excluded if they were pregnant, breastfeeding, under psychiatric care, deemed to be unfit by a general practitioner, or part of a cessation programme. 2066 participants were enrolled in the trials, 177 participants were biologically validated as prolonged reducers, and 509 as continuing smokers at both 6-week and 18-week follow-ups.

Primary outcome

Change in mental health from baseline to an 18-week follow-up was measured using the emotional well-being subscale on the Short Form Health Survey-36.

Results

After adjustment for confounding variables, the differences for reducers compared with continuing smokers were: regression modelling −0.6 (95% CI −4.4 to 3.2) and propensity score matching 1.1 (95% CI −2.0 to 4.1).

Conclusions

Smoking reduction, sustained for at least 12 weeks, was not associated with change in mental health, suggesting that reducing smoking was no better or worse for mental health than continuing smoking. Clinicians offering smoking reduction as a route to quit can be confident that, on average, smoking reduction is not associated with negative change in mental health.