Tobacco Industry “Transformation”—The Current State of Play

The tobacco industry has long been viewed as a pariah industry. However, recent developments—prompted by industry narratives—have raised questions about whether the industry is “transforming.”1 Most prominently, in 2016 Philip Morris International (PMI) declared its intention to transform and espouses delivering a “smokefree future” where cigarettes are replaced by “smoke-free alternatives.”2 With the emergence of e-cigarettes and other potentially less harmful nicotine products, proponents argue tobacco companies could shift away from production and distribution of cigarettes and smokeless tobacco to alternative nicotine products,3 or to other commercial activities such as pharmaceuticals and medical technologies.4 Some have argued for “a realignment of market forces and policies” to facilitate and encourage tobacco companies to switch to producing noncombustible nicotine products, even though they are still manufacturing combusted tobacco products.5 Such an approach presumes partial alignment of industry and public health goals is possible. It represents a radical departure from the assertion that a fundamental conflict exists between industry and public health goals6 and that effective tobacco control requires constraining the activities of transnational tobacco companies.7 Focusing on production of alternative products as markers of transformation risks distracting from the more fundamental requirement to end the production of the most harmful tobacco products. Edwards and colleagues in a review of tobacco industry transformation defined a transforming company as one demonstrating “substantial, rapid and verifiable progress towards eliminating the production and sale of conventional tobacco products within five years in all markets where it operates.”1 The authors proposed three essential criteria that a company must meet to demonstrate transformation: rapid progress towards eliminating conventional products, no obstruction of effective tobacco control measures, and evidence of action to minimize smoking uptake and disparities. They concluded that no tobacco company has yet met any of these criteria. The themed section of this month’s issue of Nicotine & Tobacco Research critically explores the current status of tobacco industry transformation. The articles address two main questions: (1) What are the potential pathways via which tobacco industry transformation might occur? and (2) Is there any robust evidence that meaningful transformation is happening? Two articles led by Levy et al.8,9 consider further whether commercial incentives might induce tobacco companies to transition to alternative products such as e-cigarettes and heated tobacco products. They analyze PMI’s takeover of Swedish Match, the dominant player in the flavored nicotine pouch market globally.8 They highlight the numerous possible market structure permutations in different jurisdictions and note how these may impact on tobacco companies’ commercial activities and policy advocacy as they seek to maximize market share and profits. For example, PMI is incentivized to aggressively promote nicotine pouches and to favor “light touch” regulation in the U.S. market where it does not sell cigarettes, but not in jurisdictions outside of the United States where PMI cigarettes have significant market share. These themes continue in their analysis of the U.S. market,9 which they describe as progressing from being cigarette-dominated to a highly fragmented nicotine delivery product market. However, they observe that to date the tobacco industry’s transition towards alternative products has been driven by competition for consumers rather than a normative commitment to harm reduction. Hence the extent of this transition could depend on the degree of competition from independent producers and whether regulatory structures support or hinder such competition. They also note that there are incentives for tobacco companies to favor more profitable and potentially more harmful alternative products such as heated tobacco which is less subject to competition from independent producers. Hence, they argue regulatory frameworks that favor less over more harmful alternative products will be needed to encourage transition towards the former. Starr and colleagues propose an intriguing model for distribution of nicotine and tobacco products through small-scale, nonprofit, user-focused, and led “compassion clubs.”10 These have no incentive to increase sales, attract new users, or supply minors. Unlike prescriber-led models of supply (such as for methadone and medicinal cannabis), compassion clubs do not require users to engage through primary health care or comply with a medical model of product use. They have been used in various settings to support harm reduction programs for illicit drugs and improved access to limited-availability pharmaceuticals. An underlying insight of the compassion club model is that commercial institutions will be incentivized to grow and maximize their product sales unless other factors (such as regulation) inhibit that growth. Several other articles address the question of whether industry transformation is occurring. Based on an analysis across 76 countries, Hiscock and colleagues11 found associations between the national concentration of transnational tobacco and leaf companies and tobacco Industry interference in national policy (assessed via the Tobacco Industry Interference Index12), suggesting industry efforts continue to obstruct effective tobacco control. Rooney and Gartner highlight the need to consider associated vested interests such as tobacco retailers when discussing industry transformation.13 They describe how the industry frames tobacco control as having adverse impacts on the retail sector, with retailer organizations (supported by the industry) often echoing such arguments. Moodie and colleagues demonstrate in their review of capsule cigarettes that the industry continues to actively develop and market innovative tobacco products, and obstructs or circumvents policies to restrict or ban flavored cigarettes.14 They argue that such actions are incongruent with tobacco industry transformation particularly given capsule cigarettes have been shown to preferentially appeal to young people. Vassey and colleagues examined the extent of industry influence in research on tobacco harm reduction.15 Based on 826 papers published between 1992 and 2016, they found almost 10% of 1405 authors had tobacco industry funding or associations (disclosed or non-disclosed). While these papers predate the “transformation” era, Dewhirst and colleagues’ analysis of industry marketing post-dates PMI’s announcement of a “smoke-free” future.16 Based on internal documents and social media posts, the authors describe how PMI’s marketing in Formula 1 motor-racing moved away from emphasizing the rugged, masculine brand identity of Marlboro to promoting the company’s redefined image through its “Mission Winnow” campaign, which emphasizes innovation, science, and transformation. The findings from these studies provide little support for claims that cigarette companies will voluntarily transition away from combusted tobacco products. Evidence of ongoing efforts to develop and market combusted products and oppose effective tobacco control measures suggests the industry continues to respond to commercial incentives to maintain or grow the size of the cigarette market. These papers also suggest that the marketing of alternative products will be driven by profit maximization rather than public health goals. Hence the sale of alternative nicotine products is unlikely in itself to change industry behavior. That will require external pressure (eg, effective regulation), supporting the assertion that public health should remain skeptical of the industry’s claimed contribution to harm reduction.17 Significantly, the “transformed” tobacco industry has failed to support new regulatory approaches aiming to phase out combusted tobacco while allowing a legal market for alternative nicotine products. An example of such an approach is New Zealand’s Smokefree Action Plan—which includes greatly reducing the supply of cigarettes, mandating very low nicotine content for smoked tobacco products, and implementing a “smokefree generation” policy; whilst also aiming to judiciously regulate alternative nicotine products.18 The response of the tobacco industry to this radical plan, which appears to have a realistic chance of achieving minimal smoking prevalence, has been either outright opposition combined with efforts to encourage retailer opposition,19 or (in the case of PMI) to stay uncharacteristically silent and launch a new low price cigarillo product.20 Finally, it is worth noting that the transformation narrative is not confined to the tobacco industry. Claims of transformation are also increasingly prominent among fossil fuel companies like BP21 in relation to the “energy transition” and achieving carbon zero. Many climate change researchers and advocates strongly doubt these claims. Interestingly, tobacco companies are also positioning themselves as transformational in relation to climate change issues.22 It appears that the rhetoric of transformation is a new strategy added to the corporate playbook,23 but unfortunately, there is little evidence this rhetoric is becoming a reality. RE receives research funding from government agencies such as the Health Research Council for New Zealand and NGOs such as the Cancer Society of New Zealand. MC and SH have no conflicts to declare. None of the authors receive any funding from the tobacco or vaping industries or their associates. Sarah Hill (Writing—original draft [Equal]), Michael Chaiton (), and Richard Edwards (Writing—original draft [Equal]).

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