Launch of Iqos
In January 2014, Philip Morris International announced an investment of €500 million to build a factory near Bologna, Italy, dedicated to the production of heated tobacco products.[10] In November 2014 the first version of Iqos was released, first marketed in Nagoya, Japan, and Milan, Italy, before being gradually rolled out to other countries.[11]
Starting in 2016, Philip Morris began heavily focusing commercial efforts on alternative nicotine-containing products to cigarettes.[12] In 2016, PMI launched Iqos Mesh in the UK.[13] The next generation of Iqos ("Iqos 3" and "Iqos 3 Multi") was launched in Tokyo in October 2018 and then in other markets around the world.[14]
In 2017, the smoke-free segment generated sales of $3.6 billion for PMI (13% of its overall sales), compared to $64 million in 2015. By the beginning of 2018, Iqos brand products accounted for 15% of the tobacco industry's market share in Japan.[4] By 2020, Iqos accounted for 5.5% of the global tobacco market while being available in 52 countries only, this number jumping to almost 70 a year later.[15][16] According to PMI financial releases, sales of smoke-free products represented nearly 30% of the company's revenue during the first quarter of 2021, and 40% by the end of 2023, with Iqos revenues surpassing those of cigarette brand Marlboro.[17][3]
In January 2020 PMI and South Korea's KT&G announced a partnership for the international distribution of Lil, a hybrid e-cigarette/heated tobacco product, as part of the Iqos portfolio.[18] The following Summer, PMI rebranded Mesh as Veev and launched it in New Zealand before gradually extending distribution to other countries.[19] Iluma, a new system using induction heating technology, was launched in Japan in August 2021.[20]
In July 2020, the US FDA granted Philip Morris International an authorization to make "reduced exposure" marketing claims, considering that the Iqos tobacco heating system met the requirements for designation as a Modified Risk Tobacco Product, the second set of products ever authorized after Swedish Match's General Snus.[21][22] The FDA explicitly stated that the product should not be considered as "safe or FDA approved."[23]
