Altria Group Inc. announced that merger discussions with Philip Morris International Inc. (PMI) have ended.
The companies now say they will focus on jointly launching IQOS, which heats tobacco to release flavorful nicotine-containing tobacco vapor but without burning the tobacco, in the U.S.
“While we believed the creation of a new merged company had the potential to create incremental revenue and cost synergies, we could not reach agreement,” said Altria Chairman and CEO Howard Willard. “We look forward to continuing our commercialization of IQOS in the U.S. under our existing arrangement.”
The companies said IQOS is the only heated tobacco product with premarket authorization from the Food and Drug Administration (FDA) for sale in the U.S. According to PMI, about 8 million adult smokers around the world have already used the product. It currently sells IQOS in 48 other markets, including Canada, the U.K., South Korea and Japan.
Altria also issues a statement on Juul Labs’ recent leadership change:
“Separately, earlier today, Juul announced the appointment of K.C. Crosthwaite as its Chief Executive Officer. Mr. Crosthwaite is stepping down from his position as Senior Vice President, Chief Strategy and Growth Officer of Altria in order to join Juul. In response, Altria’s Chairman and CEO Howard Willard said, “K.C. is a proven industry leader who understands the importance of responsible business practices. This decision by Juul recognizes that this is a critical time for the company. I believe K.C.’s experience, discipline and dedication to making harm reduction an industry-wide reality will help Juul achieve its mission, while also urgently confronting and reversing underage use of vapor products.”
