Smoking industry heats up | Fin24
In partnership with

Smoking industry heats up

Jan 22 2017 08:40
Dewald Van Rensburg and Neesa Moodley

Johannesburg - South Africa is the next testing ground for so-called next-generation tobacco products, with Philip Morris International (PMI) this year introducing the IQOS.

PMI has developed two heat-not-burn products.

One version is still under development and resembles the original Premier in that it uses carbon that burns to heat the tobacco.

The other version, the IQOS, which is launching in South Africa at the end of March, uses an electric device to heat special tobacco sticks to below combustion temperature to create a vapour.

This heating system is used together with specific tobacco sticks called “HEETS”. Over a million smokers worldwide have switched to IQOS already.

“The advantage of this approach is that the tobacco is not burnt, but is heated sufficiently for the consumer to get the flavour and the nicotine without the harmful effects associated with traditional cigarettes,” says Marcelo Nico, managing director of Philip Morris SA (PMSA).

Specifically, the aerosol generated by IQOS produced 90% to 95% less of the harmful compounds on average than a conventional cigarette, he said.

Also, like e-cigarettes, with IQOS there is no smoke, no ash and less odour.

Nico says the IQOS has already been launched in 20 markets over the past two years, including Italy, Portugal, Romania, Russia and Switzerland, and has enjoyed huge success in Japan in particular.

“PMI plans to introduce the IQOS in another 15 markets over the next year,” he says.

In South Africa, the product will be branded as Heets.

Rupini Bergström, PMSA’s spokesperson, says internationally, 1 million adult smokers have quit smoking and switched to the IQOS product since its launch two years ago.

Phillip Morris SA conducted a pilot project late last year with employees who are adult smokers.

The conversion to the product has been significant, says the company.

Of the initial staff sample market of 390 in South Africa, 184 smokers have switched over to the new product.

User Palesa Mzozoyana says she particularly appreciates the fact that she can now puff in her car without worrying about ash flying back into her face.

“My furniture and my car don’t smell of smoke any more and people around whom I have used Heets say it is barely noticeable,” she says.

There is a slight odour when the heating element is initially switched on that is formed in the distillation process that the heat stick undergoes, but this soon fades away and the “smoke” that users exhale is actually the water vapour that is used to distil the heat stick.

While pricing has not yet been finalised for the South African market, the initial device cost in other markets has been “fairly similar” to the initial set-up costs for a good-quality vape product.

The actual tobacco or heat sticks come in packs of 20 and the cost would be similar to buying a pack of cigarettes, so smokers should expect their budget to remain unaffected.


The resurrection of the heat-not-burn concept follows the astonishing success of e-cigarettes, which may have paved the way for innovations smokers were not ready for in the 1980s.

It is hard to reliably track e-cigarette use compared with tobacco because a large part of the industry operates only online, where sales are not well tracked by research groups such as Nielson and Euromonitor that usually provide this kind of data.

While the introduction of e-cigarettes was pioneered by a large number of independent companies, big tobacco firms have quickly seized control.

In the US market, the three leading brands of e-cigarettes are Vuse, blu and Logic, which are respectively owned by Reynolds, Imperial Tobacco and Japan Tobacco.

With reference to the changing tobacco market, Nico says: “One day, we hope to realise our goal of a smoke-free future and PMI is committed to doing everything we can to ensure that smoke-free products replace cigarettes as soon as possible.”

It will be years before there is definitive evidence on the health effects of e-cigarettes, which have been around in most markets for less than a decade.

Health authorities in the UK and US produced reports on the technology last year and have diverged in their assessment of the new nicotine industry.

The UK’s Royal College of Physicians is pretty upbeat about e-cigarettes being unambiguously better than tobacco.

The US Surgeon General late last year, however, produced a 300-page report arguing for strict regulation to stop children from using e-cigarettes.

All over the world, the first question regulators are asking themselves is whether e-cigarettes and derivatives such as the IQOS should be subject to the full range of anti-tobacco measures.

These include bans on indoor smoking and advertising, but also the punitive tax regimes countries including South Africa have put on tobacco.

According to PMI’s annual report for 2015, several countries have established dedicated excise tax categories for non-combustible, heated tobacco products.

In other markets, heat sticks have been classified in existing tobacco excise tax categories other than cigarettes.

In South Africa, National Treasury is apparently planning to include e-cigarettes in the tobacco taxation system.

In last year’s Budget Review, this got a short mention – a review of tobacco tax was under way ande-cigarettes were part of it, said Treasury.

It is estimated that there are more than 200 000 e-cigarette users in South Africa, with the biggest brand, Twisp, having reported growth of 4 000% in the four years to July 2016.

According to deputy health minister Joe Phaahla, it is estimated that 44 000 people die in South Africa each year because of smoking.

However, the department of health added that the percentage of smokers in South Africa had decreased by 7% since smoking in public spaces was prohibited in 2009.

New legislation is expected to come out later this year, which will include the regulation of e-cigarettes.

Read Fin24's top stories trending on Twitter:

tobacco  |  smoking  |  e-cigarettes


Read Fin24’s Comments Policy publishes all comments posted on articles provided that they adhere to our Comments Policy. Should you wish to report a comment for editorial review, please do so by clicking the 'Report Comment' button to the right of each comment.

Comment on this story
Add your comment
Comment 0 characters remaining

Company Snapshot

Money Clinic

Money Clinic
Do you have a question about your finances? We'll get an expert opinion.
Click here...

Voting Booth

Trump’s administration has threatened to choke Huawei, hitting some of its biggest component makers. What are you most concerned about??

Previous results · Suggest a vote