Will Philip Morris fulfill pledge to be ‘majority smoke-free’ in Connecticut? – The Advocate

STAMFORD — The upcoming arrival of Philip Morris International has revealed a conflict Gov. Ned Lamont and other officials have with the tobacco giant.

Lamont and legislators who represent Stamford at the state Capitol and in Congress say they are non-smokers, but they are keen to tout the economic benefits of another Fortune 500 company moving to Connecticut — despite their distaste for cigarettes and recognition that tobacco use has caused thousands of deaths in the state each year.

The governor and other supporters of PMI’s relocation argue that the new headquarters at 677 Washington Blvd. — the former home of UBS — can help the company fulfill its pledge to move away from cigarettes to less harmful “smoke-free” products. Many of those officials also maintain that PMI’s presence will not discourage them from advancing anti-tobacco initiatives.

“I think they’re moving in the right direction and moving the smoking population in the right direction,” Lamont, who confirmed last week that he would run for reelection, said in an interview with Hearst Connecticut Media.

‘Good for Connecticut’

PMI will move its headquarters from midtown Manhattan and open offices next summer at 677 Washington that will cover more than 71,000 square feet. The No. 101 firm on this year’s Fortune list intends to bring about 200 jobs to the state. It estimates the “total economic impact” of its Connecticut-based positions will be about $50 million in 2022.

“They’re an innovative company, which is going to be good for Connecticut,” said state Rep. Daniel Fox, D-Stamford, one of the officials who attended a press conference last week at 677 Washington to welcome PMI.

PMI is not receiving state subsidies to move to Stamford. But its move followed extensive discussions involving company officials, Lamont and other members of his administration.

“Regardless of my strong criticisms of the tobacco industry, I am glad that Stamford is a highly attractive destination for businesses of all kinds,” said state Rep. Matt Blumenthal, D-Stamford. “I look forward to continuing to work to help make it even more so.”

State Rep. David Michel, D-Stamford, said backing the company’s move did not indicate that he and other officials condoned smoking or that they endorsed the business practices of every company operating in the city. He cited, for instance, his disapproval of two major firms based in his district: OxyContin maker Purdue Pharma, which is headquartered at 201 Tresser Blvd., and Building and Land Technology, which is the developer of the mixed-use Harbor Point complex in the city’s South End.

“I am glad empty offices are being filled in Stamford and surely hope the staff and families will live and thrive in our great city,” Michel said in an email.

The future of smoke-free products

PMI’s relocation has sparked greater scrutiny in Connecticut of the company’s position as one of the world’s largest tobacco producers. It shipped more than 628 billion cigarettes around the world in 2020 — down 11 percent from 2019, but still accounting for the majority of it nearly $29 billion in revenues last year. Its brands include Marlboro, L&M, Chesterfield, Philip Morris and Parliament.

Worldwide, the tobacco epidemic results in more than 8 million deaths each year, according to the World Health Organization.

PMI’s “products historically have not been safe. Its current products are concerning,” said state Sen. Saud Anwar, D-South Windsor, a physician whose specialties include treating lung diseases and who serves as vice chairman of the state legislature’s Public Health Committee. “Their future products should also be considered unhealthy, and their marketing should be taken with great skepticism.”

PMI does not sell or market its products in the U.S. Philip Morris USA — a subsidiary of Altria Group, from which PMI was spun off in 2008 — dominates the American cigarette market. Marlboro ranks as Philip Morris USA’s top-selling brand.

In the U.S., cigarette smoking is estimated to cause more than 480,000 deaths annually, including fatalities from second-hand smoke, according to the Centers for Disease Control and Prevention.

In Connecticut, “4,900 adults die each year from their own smoking,” according to the state Department of Public Health’s website.

PMI officials do not deny the damaging effects of tobacco. They argue, however, that it would be counterproductive for the company to abruptly exit the cigarette market.

“If we pulled out, it’s not that the market would disappear itself; others would walk in and fill that space,” Deepak Mishra, president of the Americas region for PMI, said at last week’s press conference. “The others in this case very often include illicit trade, which is loss of revenues for the government and probably not the right quality of products for consumers.”

Mishra added that “being in the cigarette business provides an infrastructure and channels to actually reach our smokers and convince them as we have done, with 20 million people already to convert to smoke-free products. If we left the business, we wouldn’t have the ability to do that.”

Officials who attended the press conference said they accepted that argument.

“It’s a matter of weaning themselves off (cigarettes). It isn’t something that they’re going to be able to just do right away,” said state Sen. Patricia Billie Miller, D-Stamford. “They realize the harm of cigarettes.”

PMI’s long-term strategy focuses on moving away from cigarettes and focusing on smoke-free products such as the heated tobacco sticks sold under its IQOS brand. Smoke-free products accounted for nearly 30 percent of PMI’s net revenues in the third quarter of 2021, and the company is aiming to become a “majority smoke-free company” in net revenues by the end of 2025.

IQOS products are available in 69 markets worldwide. Altria sells them in the U.S., through an exclusive license provided by PMI — with IQOS’ American market now covering Georgia, North Carolina, South Carolina and Virginia.

PMI shipped about 76 billion heated tobacco sticks in 2020, up 28 percent from 2019.

“Since there is no burning, the levels of harmful chemicals are significantly reduced compared to cigarette smoke,” PMI says on its website. “Our studies on IQOS heated tobacco products are progressing rapidly and indicate that it has the potential to present less risk of harm compared to continued smoking for adult smokers who switch to it completely instead of continuing to smoke.

By PMI’s own admission, however, smoke-free tobacco is not harmless. Among the risks, IQOS products deliver nicotine, which is addictive.

“While a few studies may suggest newer products are not as dangerous as combustible tobacco products, it is important to realize that is not a good criteria of judgment of safety,” Anwar said. “Their new products may be better than previous ones, but that does not mean they are safe. It is important to avoid such chemicals and delivery mechanisms because of the long-term implications.”

In the past few months, PMI has further diversified with transactions that included a takeover of asthma-inhaler maker Vectura, a deal reportedly worth about $1.5 billion; an acquisition of nicotine gum maker Fertin Pharma for approximately $820 million; and the $51 million purchase of OtiTopic, which develops respiratory drugs.

“At PMI, we’re making rapid progress toward our smoke-free future,” Mishra said. “A lot of that innovation will be driven right from here (in Stamford) in terms of coming up with and then commercializing products that can change the lives of smokers.”

Reducing tobacco use

Despite PMI’s move to Stamford, a number of officials said they would continue to pursue anti-tobacco legislation.

“I have continued to fight for stronger steps against tobacco use and nicotine addiction,” said Sen. Richard Blumenthal, D-Connecticut, who sued Philip Morris USA in the 1990s when he was serving as state attorney general. “My question about a company is not about where it is located, but what does it do.”

Sen. Chris Murphy, D-Connecticut, a member of the Senate Health, Education, Labor and Pensions Committee, said in a statement that “as a dad to two children, having PMI in Connecticut doesn’t change my belief one bit that government needs to do everything it can to combat tobacco use and attack the epidemic of youth e-cigarette use.”

U.S. Rep. Jim Himes, a Democrat whose district includes most of Fairfield County, including Stamford, said in a statement that his support for PMI’s relocation does not conflict with him being “very concerned about the rise in teenage use of nicotine products and (I) know it’s an important issue to parents and families.”

“I was proud to join my colleagues in voting for the Tobacco-Free Youth Act to raise the federal minimum age to buy all tobacco products, including e-cigarettes and vaping devices, from 18 to 21 years old,” Himes added.

In Hartford, state officials have enacted a number of major smoking-related changes in recent years.

In June, Lamont signed a law that legalizes recreational marijuana use. The law also contained new smoking restrictions, including the elimination of smoking in hotel guest rooms and designated workplace lounges.

In 2019, the state raised the minimum age for buying tobacco products from 18 to 21.

But other key pieces of tobacco legislation have stalled — at least for now. In June, the state Senate rejected a measure that would have banned flavored e-cigarettes, amid complaints that it contained too many loopholes. A few weeks earlier, legislators decided to end their pursuit in the 2021 session of a ban of all flavored tobacco products, including menthol cigarettes.

At the same time, some public health-focused advocacy groups are dissatisfied with funding for anti-tobacco efforts in Connecticut. Since the 2015 fiscal year, zero state dollars have been allocated to tobacco control programs, according to the American Cancer Society Cancer Action Network, the ACS’ nonprofit and nonpartisan advocacy organization. This year, $1 million in American Rescue Plan Act funds were allocated to local health districts for tobacco control — “but with no regulations, direction on how the funds should be spent or oversight,” according to ACS CAN officials.

“Now more than ever, it’s time for Connecticut lawmakers to commit to restoring at least $12 million to the state’s tobacco control and prevention program, helping people quit tobacco use and helping prevent kids from ever picking up the deadly addiction,” ACS CAN spokesperson Amber Herting said. “Doing so will save the state money and, more important, it will save the state lives.”

pschott@stamfordadvocate.com; twitter: @paulschott

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