20171024w_biz_glo

British American Tobacco’s heat-not-burn cigarette, “glo,” is expanding into Russia.

British American Tobacco is expanding the reach of its heat-not-burn cigarette brand — glo — into a fifth major market in Russia.

BAT, the 100 percent owner of Reynolds American Inc. since July, said glo contains 90 percent to 95 percent fewer toxicants compared with conventional cigarettes. BAT said a single charge of its glo stick lasts up to 30 sessions.

The other markets where glo is available are Canada, Japan, South Korea and Switzerland.

Heat-not-burn cigarettes, the science of which was pioneered in part by R.J. Reynolds Tobacco Co., are considered as a potential reduced-risk product because the burning of tobacco leaves releases carcinogens.

However, a study published in May in JAMA Internal Medicine found that secondhand smoke from heat-not-burn cigarettes released some of the same cancer-causing chemicals as do traditional cigarettes.

Nicandro Durante, BAT’s chief executive, told the Winston-Salem Journal in July that glo will be submitted for Food and Drug Administration regulatory review.

A BAT investor presentation on Oct. 25 indicated plans for a substantial equivalence filing in 2018 and a modified-risk tobacco product application in 2020.

A substantial-equivalence filing is for products that either have the same characteristics as those marketed on/before Feb. 15, 2007, or have different characteristics but do not raise different questions of public health. A modified-risk tobacco product applications seeks authorization to market products as reduced harm or reduced risk compared with traditional cigarettes.

The heat-not-burn technology is in use by Philip Morris International with the Marlboro HeatStick, which is sold primarily in Italy, Japan and Switzerland but is available in 19 other countries. The manufacturer has expressed optimism for debuting the heat sticks in the U.S. in 2018.

Bonnie Herzog, an analyst with Wells Fargo Securities, has said interest in heat-not-burn cigarettes among U.S. tobacco retailers has increased since July 27, when FDA Commissioner Dr. Scott Gottlieb called for a sweeping regulatory “road map” on tobacco and nicotine products. Proposals include easing some regulations for product innovations and extending the application deadline for FDA regulatory review for new products from late 2018 to as far out as August 2022.

Gottlieb also supports efforts to shift traditional cigarettes to very low nicotine levels.

“The global markets for reduced risk products are going to become increasingly competitive,” said Scott Ballin, past chairman of Coalition of Science OR Health. “Clearly, these companies know that in the next 10 to 20 years they will lose their cigarette markets, and they need to aggressively start to market and sell reduced-risk products in as many markets as they can.”

However, Ballin said their efforts “will become increasingly difficult as more countries move to ban products like electronic cigarettes.”

David Sweanor, an adjunct law professor at the University of Ottawa and the author of several e-cigarette studies, said heat-not-burn cigarettes are have grown in popularity in Japan to the point they rival e-cigs as the top alternative to traditional cigarettes.

“The heat-not-burn products have led to Japan currently having the most rapid decline in cigarette smoking that we have ever seen in a developed market,” Sweanor said. “Russia is a huge market that has shown receptivity to low-risk products, so BAT is being astute rather than becoming the next Kodak ... Tobacco companies have no choice, they either ride this wave or get crushed by it.”

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