LONDON -- British American Tobacco (BAT) laid out a framework for its global path away from the sale and manufacture of combustible cigarettes, speaking to a future of tobacco alternatives such as heating devices and other tobacco products (OTP).
Issuing its annual Sustainability Report alongside its 2017 Annual Report on March 15, the company said it has spent $2.5 billion since 2012 in developing what it called next-generation products that included vapor devices and tobacco-heating products.
“We recognize that the tobacco and nicotine industry has entered a dynamic period of change, and we are committed to leading this transformation,” said Nicandro Durante, chief executive of London-based BAT. “Increased public-health awareness, new societal attitudes and rapid developments in new technologies have all combined to create a unique opportunity to accelerate the delivery of our long-held ambition to provide our consumers with less risky tobacco and nicotine choices.”
The report notes that BAT’s 2017 acquisition of Winston-Salem, N.C.-based Reynolds American Inc. (RAI) increased its position in both the vapor and oral-tobacco business within the United States. Besides that boost in share, the BAT report touted “major changes” it has made to its research and development department, “embracing new technology, methodologies and consumer trends.”
The results are expected to include a new “carbon tip” tobacco-heating product (THP), which is scheduled to begin testing this year, the report said. Also on the map for 2018 is the launch of the company’s new Vype ePen.
Beyond new-product introductions and testing, the report noted how the company's U.S. subsidiaries have submitted applications to the U.S. Food and Drug Administration for the designation of Camel Snus as a modified-risk tobacco product and a substantial-equivalence application for its Eclipse THP.
BAT has a goal of generating more than $1.4 billion in revenue from next-generation products in 2018 and $7 billion by 2022, the report said.
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