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BAT Plea for Smokeless Tobacco Gets Knocked Back

Posted on: Sunday, 24 July 2005, 09:00 CDT

The Government has knocked back a request from British American Tobacco, one of the world's biggest cigarette companies, to discuss its latest product " a tobacco that you suck.

BAT wrote to the Department of Health last month seeking a meeting about the product, known as 'snus', which it launched in May in Sweden and South Africa. BAT believes it is a healthier alternative to cigarettes. Should the product take off, BAT hopes to expand into other countries.

However, because snus falls into the category of smokeless tobacco, it is banned in the UK and most of the European Union. BAT's long-term intention is to lobby the EU about changing the rules, but it feels it cannot do so without the backing of its own government.

Yet BAT says the Department of Health declined to discuss the product as it is illegal. 'All we wanted to do was to let them know what we're doing,' said Chris Procter, the head of science and regulation at BAT. 'We're trying to collate evidence to say 'is this a good idea or not? But they are closed minded on it. It was really disappointing.'

A BAT spokesman called the knockback 'frustrating'.

The company argues that snus " a small sachet of moist tobacco which is held under the lip " is less harmful than cigarettes. Studies suggest that it does not lead to increased risk of lung cancer or chronic obstructive pulmonary disease, primarily because no smoke is inhaled, it claims. Snus does contain nicotine, however.

Sweden is one of the few countries that allows smokeless tobacco, and negotiated the right to retain its legal status when it joined the EU. Cigarette and lighter giant Swedish Match dominates snus, with a market share of around 90 per cent.

BAT, however, is the first into South Africa with snus, where the product is branded as Peter Stuyvesant. In Sweden, it is known as Lucky Strike snus.

Tobacco companies are coming under pressure in the US and Europe as the number of smokers falls and taxes and litigation increase. Most are looking to other parts of the world, such as the developing markets of Eastern Europe and Asia, to deliver long term growth. But few want to abandon Europe.

BAT, which publishes interim results on Thursday, said feedback on snus had been 'extremely positive', with encouraging sales levels in both countries. However, the rollout in Sweden is not yet complete.

BAT intends to spend the next year assessing the product, which is sold in tins of 24 sachets, before making a decision on where to expand next.

But Mr Procter conceded: 'If we're never going to get regulatory approval, or if there are problems like kids being attracted to it, we will drop it.'

The company is expected to post interim pre-tax profits of pounds 1.24bn, up from last year's pounds 1.16bn, supported in part by sturdy performances in Germany and Malaysia. BAT is also launching a significant cost-savings programme, in part to reduce debt.

Source: Independent on Sunday, The

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