BAT and PMI Reach Patent Infringement Settlement

Prevents future claims against each other over heated tobacco and vapor products
Photograph: Shutterstock

Tobacco companies British American Tobacco (BAT) and Philip Morris International (PMI) on Friday said that they have reached a global settlement that resolves all ongoing patent infringement litigation between the cigarette makers related to their heated tobacco and vapor products.

The global patent battle is tied to the two companies’ heat-not-burn technology and the settlement agreement is valid for eight years, according to a filing with the U.S. Securities and Exchange Commission (SEC).

The settlement includes non-monetary provisions with both companies agreeing to dismiss all ongoing infringement litigation. The settlement also prevents future claims against current heated tobacco and vapor products. 

"We are pleased that this matter has been resolved to the mutual satisfaction of both parties,” said PMI’s CEO Jacek Olczak in a statement. “There is a clear and growing global desire from adults who smoke to choose from a range of smoke-free products, and we believe continued reduced-risk category innovation can accelerate declines in the harms associated with smoking to the benefit of consumers and public health at large—as we continue PMI’s journey to end the sale of cigarettes."

“This agreement is an important step forward for BAT and all our stakeholders,” BAT CEO Tadeu Marroco said in a statement. “Having already built two £1bn [$1.08 billion] brands in Vuse and glo, the potential for their continued impact on tobacco harm reduction is clear. I am delighted that this settlement will allow BAT to focus on developing innovative solutions that provide adult consumers with a greater choice of reduced risk products in support of our A Better Tomorrow purpose. By doing so, we will help build a smokeless world for the benefit of consumers, investors and society as a whole.”

The U.S. International Trade Commission (ITC) ruled on Sept. 29, 2021 that PMI’s IQOS infringed on two patents held by rival R.J. Reynolds, a subsidiary of British American Tobacco.

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