Philip Morris to spend P8.8 billion for smoke-free products

MANILA, Philippines — Philip Morris International (PMI) plans to invest an additional P8.8 billion (approximately $150 million) in its Philippine affiliate PMFTC Inc. to open manufacturing lines that will produce specially designed heated tobacco sticks for its smoke-free products.

The investment, which is expected to span a two-year period, could generate as much as 220 new specialized jobs and will further support the local tobacco growing industry.

This marks the largest investment to date in the cigarette alternative category in the country and brings PMFTC a step closer to achieve its vision of a smoke-free Philippines. PMI’s investment is also the first major investment by a tobacco multinational in the category domestically.

“We are proud to invest in the country’s journey to finally rid society of cigarettes, by providing better alternatives to those who would otherwise continue to smoke, while helping generate revenues for the government and livelihood opportunities for the people,” saidx, PMFTC president.

The investment will include an expansion wing at PMFTC’s state-of-the art factory in Tanauan City, Batangas. Actual commercial production is expected to commence in the fourth quarter of 2023.

Locally grown tobacco has also been approved for inclusion in the production of heated tobacco sticks. This development is expected to help sustain the livelihoods of Filipino tobacco farmers and sari-sari store owners.

“Through PMI’s continued investment in research, development and production, we can now heat tobacco in a way that is satisfying to adult smokers. Using sophisticated electronics, IQOS precisely heats specially designed tobacco units just enough to release a flavorful nicotine-containing vapor,” Gorkun said.

In 2020, PMFTC Inc. launched the IQOS tobacco heating system, PMI’s flagship smoke-free product, in the Philippines. IQOS devices use a patented HeatControl™ Technology that precisely heats, without burning, tobacco-filled sticks wrapped in paper called HEETS to release a water-based aerosol. Unlike cigarettes, IQOS does not burn tobacco and therefore produces no smoke and no ash.

PMFTC, an agriculture and consumer products company, has been leading change across the Philippine tobacco industry. A business combination between LT Group Inc. and PMI, PMFTC Inc. is an employer of choice; a major leaf buyer and taxpayer; and a partner to law enforcement.

Around the world, PMI is building a future on a new category of smoke-free products that, while not risk free, are a much better choice than continued smoking due to the elimination of combustion -- the primary cause of smoking-related problems.

Through multidisciplinary capabilities in science and technology, the company aims to ensure that their smoke-free products meet adult consumer preferences and rigorous regulatory requirements. As the market leader, the firm is committed to offering adult consumers who would otherwise continue to smoke better alternatives and playing an active role in making Philippine society smoke-free.