Phillip Morris’s new remorse over China sales

Falling rates of smoking are one of America’s greatest public health triumphs, with numbers dropping 20% since 2005 alone. Hence, it is widely known that for some time tobacco companies have focussed on international markets. For example, in China, men smoke at double the rate of those in the U.S. and in Russia the rate is nearly three times that of America. As more and more nations recognize the human and economic costs of tobacco use, international pressure is building against the U.S. companies who profit from smoking.

In “A Marlboro Vaccine? Maybe for China,” The Wall Street Journal Reports that cigarette giant Phillip Morris is trying to improve it’s image in China ” where more than a third of the world’s cigarettes are smoked. “In one curious effort, (Phillip Morris) is setting out to develop flu vaccines derived from a type of tobacco plant. In another project, closer to its core business, it is developing less harmful cigarettes.It would aim to sell these less-harmful cigarettes all over the globe, but especially in China, where a quarter of the population smokes but state-owned China National Tobacco Corp. enjoys a virtual monopoly. A passenger lights a cigarette in a smoking area at the Beijing airport.In September, Philip Morris said it would be licensing rights from Medicago Inc., a small Canadian biopharmaceutical company, to develop vaccines for sale in China. The seemingly incongruous move is motivated by several different situations. Philip Morris already owns about 40% of Medicago. Philip Morris also has a goal of diversifying into different tobacco-related products.

More important, the vaccine agreement in China has as much to do with cultivating relations with government officials as diversifying into a new business that may or may not take root. The opportunity in China is simply too big to ignore for Switzerland-based Philip Morris, the world’s second-largest cigarette company by volume, after China National Tobacco.’This is one other way they could endear themselves to the Chinese,’ said Bonnie Herzog, a global tobacco analyst at Wells Fargo .

One Reply to “Phillip Morris’s new remorse over China sales”

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