STAMFORD, CT - Swedish Match, a subsidiary of Philip Morris International Inc. (NYSE: NYSE:PM), is seeking renewed authorization from the U.S. Food and Drug Administration (FDA) to market its smokeless tobacco product, General Snus, as a Modified Risk Tobacco Product (MRTP). The request was presented to the Tobacco Products Scientific Advisory Committee (TPSAC) on June 26, 2024, as part of the FDA's review process.
General Snus, a non-fermented, air-cured tobacco product, has been available in the U.S. for over a decade. Swedish Match is aiming to continue communicating to legal-age consumers that using General Snus instead of cigarettes puts them at a lower risk for certain diseases. The company also seeks to expand the use of this reduced-risk claim to additional marketing channels, such as point-of-sale displays and direct mail to age-verified consumers.
The initial MRTP authorization, granted in October 2019, allowed Swedish Match to share the reduced-risk message only on the General Snus website. The company has now provided real-world evidence to the TPSAC, indicating that the claim is effective in reducing harm to individual tobacco users and benefiting public health.
During the TPSAC meeting, Swedish Match highlighted its responsible marketing practices and discussed scientific, technical, and consumer communication topics. The company's portfolio includes eight varieties of General Snus, such as Original, White, Mint, Wintergreen, Mini Mint, Classic Blend, and Nordic Mint.
Stacey Kennedy, President of the Americas Region & CEO of PMI's U.S. business, expressed pride in the company's commitment to a cigarette-free America and emphasized the importance of science-guided policy to achieve this goal. She also noted the confusion caused by misinformation about smoke-free products and the potential for regulatory policies to hasten the transition from smoking.
Since 2008, Philip Morris International has invested over $12.5 billion in developing and commercializing smoke-free products, with the ultimate objective of ending cigarette sales. The acquisition of Swedish Match in 2022 furthered PMI's mission to become a global leader in oral nicotine delivery.
The information in this article is based on a press release statement.
In other recent news, Philip Morris International has been in the spotlight for various reasons. The World Health Organization, along with industry watchdog STOP, accused tobacco companies, including Philip Morris and British American Tobacco (NYSE:BTI), of marketing vaping products to younger demographics. Both companies have refuted these claims, emphasizing their commitment to responsible marketing practices and adult-only products.
Simultaneously, Philip Morris is preparing to launch its heated tobacco device, IQOS, in the U.S. in the second quarter of 2024. The company has invested over $12.5 billion in smoking alternatives, primarily in the development of IQOS. The U.S. Food and Drug Administration has authorized Philip Morris to market IQOS as a product that reduces exposure to harmful chemicals compared to cigarettes, a distinction not granted to vapes.
Lastly, the company reported strong first-quarter results for 2024, driven by significant growth in its smoke-free portfolio. This led to double-digit increases in the company's adjusted diluted earnings per share and organic net revenue, surpassing market expectations. Despite facing currency headwinds, Philip Morris has raised its full-year operating income growth forecast, reflecting confidence in sustained momentum throughout the year.
InvestingPro Insights
In the context of Philip Morris International's (NYSE: PM) ongoing efforts to promote smoke-free products, the company's financial health and shareholder benefits remain a key focus for investors. With a track record of raising its dividend for 16 consecutive years, Philip Morris not only demonstrates a commitment to delivering shareholder value but also shows confidence in its long-term business strategy. This is underscored by the company's impressive gross profit margins, which are indicative of its ability to effectively manage costs and sustain profitability in its operations.
Investors may also find comfort in the company's low price volatility, suggesting that Philip Morris International's stock provides a stable investment with less market turbulence compared to its peers. This stability, coupled with a significant dividend yield, makes it an attractive option for income-focused investors. It's worth noting that Philip Morris has maintained its dividend payments for 17 consecutive years, reinforcing its reputation as a reliable dividend payer.
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InvestingPro Data:
- Philip Morris International has a high revenue valuation multiple, which may reflect the market's optimism about the company's future growth prospects, especially in the smoke-free product category.
- Analysts predict that the company will be profitable this year, which is supported by its profitability over the last twelve months, suggesting that its strategic investments and operational efficiency are paying off.
As Philip Morris International continues to navigate the regulatory landscape and invest in the development of reduced-risk products, these financial metrics and InvestingPro Tips provide a comprehensive view of the company's robust financial position and commitment to delivering shareholder value.
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