Altria Group Inc. is moving full throttle toward getting its tobacco innovation products into the daunting federal regulatory gauntlet.
Company officials told analysts and investors Thursday that it will file:
- In the first quarter, a modified-risk tobacco product application for Copenhagen moist snuff with the Food and Drug Administration.
A modified-risk tobacco product application seeks authorization to market products as reduced harm or reduced risk compared with traditional cigarettes.
- By the end of 2018, a premarket tobacco application for smokeless chewable products — discs, chews, chewable dissolvables and melts — under the Verve brand.
The premarket standard requires the FDA to consider products’ risks and benefits to the population as a whole, including users and non-users.
- By the end of 2018, a premarket tobacco application for MarkTen, its main electronic cigarette brand. There are plans for a modified-risk application at a later date.
Altria announced it has made a minority investment in Avail Vapor LLC to gain more insight into the non-traditional vapor market.
Avail has more than 100 company-owned stores in the U.S. and offers more than 100 premium Avail-branded and manufactured liquids, as well as a wide range of predominantly open-system devices popular with vapors.
Altria confirmed it would — as expected — piggyback on Philip Morris International’s March premarket application with the FDA to sell its IQOS Marlboro HeatSticks in the U.S.
The FDA accepted the IQOS application for scientific review of the heat-not-burn cigarettes in August. Altria officials said an answer could come as early as February. The FDA accepted in May a modified-risk application for IQOS.
“We have been building a portfolio of the leading platforms of noncombustible, nicotine-containing products for adult tobacco consumers, as well as preparing the scientific case for obtaining regulatory authorizations for them,” said Marty Barrington, Altria’s chairman, chief executive and president.
“We believe the breadth, quality and focus of our non-combustible product portfolio is second to none.”
By comparison, R.J. Reynolds Tobacco Co. confirmed last week it is attempting another go with Eclipse.
The heat-not-burn traditional cigarette technology was considered ahead of its time when developed in the 1990s, but has struggled to gain traction with smokers.
In July, Reynolds submitted a substantial-equivalence FDA application. That application pathway is for products that either have the same characteristics as those marketed on/before Feb. 15, 2007, or have different characteristics but do not raise different questions of public health.
British American Tobacco Plc, Reynolds’ parent company since June, has confirmed plans for a substantial-equivalence filing for its heat-not-burn product, glo, with the FDA in 2018, as well as a modified-risk tobacco product application in 2020.
R.J. Reynolds Vapor Co. has the top-selling e-cig in Vuse, though its market share lead has been chipped away in recent weeks.
Dr. Scott Gottlieb, the FDA commissioner, called in July for a sweeping regulatory “road map” on tobacco and nicotine products.
That included easing some regulations for product innovations, and extending the application deadline for FDA regulatory review for new products, such as e-cigs and vaporizers, from late 2018 to as far out as August 2022.
“We believe the FDA has articulated a compelling vision for the future of innovative products,” Barrington said.
Altria officials, however, were more cautious about convincing consumers to switch from cigarettes with traditional levels of nicotine to the very-low-nicotine levels being advocated by the FDA. Some officials didn’t want the nicotine levels reduced to the point of being an effective ban on nicotine.
“Any potential nicotine standard will go through a rigorous science and evidence-based process before it becomes a final regulation,” said Murray Garnick, Altria’s general counsel.
“In the interim, we are advancing the development of our non-combustible products portfolio and doing work to prepare for reasonable potential standards. No doubt, this will be a multi-year process.”
Wells Fargo Securities analyst Bonnie Herzog said that “on one hand, Altria will likely face a substantial increase in costs to comply with any reduction in nicotine across its combustible cigarette platform.
“On the other hand, the FDA has effectively left a ‘back door’ open by encouraging the development of non-combustible/vapor/reduced-risk product alternatives. This puts Altria in a strong position, we believe, with its growing portfolio of e-vapor & smokeless products & soon iQOS.”
Altria plans to re-brand Nat Sherman products as a super-premium, additive-free cigarette, which analysts say is aimed at competing with Reynolds’ Natural American Spirit super-premium cigarette. The Nat Sherman rebranding includes a test market in Colorado.