With just five years remaining until Philip Morris International's (PMI) 2030 smoke-free target, aiming for over two-thirds of the company’s revenue to come from smoke-free products, PMI is optimistic about achieving this goal right on schedule.
Over the past three decades, PMI has invested $12.5 billion in scientific research and innovative product development, which the company credits for expediting its smoke-free vision. PMI’s flagship heat-not burn product, IQOS, launched a decade ago and today, PMI's smoke-free products are now available for sale in 92 markets.
Speaking at the 2024 Technovation Summit in Abu Dhabi, United Arab Emirates (UAE), PMI Chief Executive Officer Jacek Olczak emphasised that the company is already planning beyond 2030.
“The last 10 years have been great. We have made significant progress, and in terms of where we are today, we are almost approaching 30% of our total revenue coming from smoke-free products. I am sure 10 years ago, when we said we would achieve it, most people would say, ‘Maybe, let’s see,’ but we did it,” said Olczak.
Currently, approximately 36.5 million adults around the world use PMI's smoke-free products. Olczak attributed much of the progress to the Heat-not-burn and other smoke-free products, which he said had brought PMI’s vision closer to reality.
Launched in Japan and Italy in 2014, the Heat-not-burn product IQOS has been a key factor in reducing cigarette-smoking prevalence. Data from the Japanese Ministry of Health, Labour, and Welfare indicates a 40% decline in smoking prevalence since 2014, dropping from 19.6% of adults to 10.6% in 2022.
PMI’s data reveals that smoke-free products accounted for 38% of its net revenue in the third quarter of 2024 (Q3’24), up from nearly 0% in 2014.
Stephano Volpetti, PMI’s President of Smoke-Free Inhalable Products and Chief Consumer Officer, stressed the importance of expanding PMI’s reach beyond its current 92 markets.
“Our mission is to replace cigarettes and ensure all adult smokers can switch. If we want to achieve our goal and our mission to provide these alternatives to all adult smokers, we need to make faster progress in this region. This is something that we as PMI are committed to do with our investment of $12.5 billion,” said Volpetti.
PMI shifted its focus in 2009 toward science and technology, unveiling a new research and development facility in Switzerland. In 2014, the company launched its heated tobacco product, and by 2016, PMI announced its ambitious smoke-free vision. In 2022, the company expanded into the wellness and healthcare sectors.
“In 2022, we made one of our greatest moves in history. We acquired Swedish Match and expanded our oral smokeless portfolio, solidifying our position as a global smoke-free champion,” said PMI executives.
While PMI’s smoke-free journey has made significant strides, challenges persist. Dr. Moira Gilchrist, Chief Communications Officer at PMI, noted that nicotine misconceptions remain a major hurdle.
“What we have found is that people don’t really understand the issue of nicotine. I talk to individuals in the scientific community, public health, journalists—everyone—and their greatest concern is that these products still contain nicotine. I tell them, yes, nicotine is addictive, but it’s still part of the solution,” said Dr. Gilchrist.
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There are often misconceptions about the role of nicotine in causing smoking related disease, and this can act as a barrier that prevents adults who would otherwise continue smoking from considering the use of smoke-free alternatives instead, she explained. Nicotine is one of the reasons why adults smoke, along with other factors, such as taste and ritual. It is addictive and not risk-free, but it is the high levels of harmful and potentially harmful chemicals in the smoke of a burning cigarette that are the primary cause of smoking related disease, not nicotine, she went on saying.
While nicotine is not the primary cause of smoking-related disease, it is addictive and not risk-free. Some people should not use products that contain nicotine. This includes pregnant or breastfeeding women and people with heart disease, severe high blood pressure, or diabetes, and minors who should not use or have access to tobacco or nicotine containing products.
