Study finds a?˜serious flawsa?? in eu report on illicit tobacco

Study finds serious flaws in EU report on illicit tobacco

22 January 2014

Public health experts from our Department for Health will claim at an event in the European Parliament today (Wednesday 22 January) that there is growing evidence that the tobacco industry is still involved in the illicit cigarette trade and using exaggerated levels of smuggling as an argument to appeal tobacco control policies.

Presenting findings from a new study, Professor Anna Gilmore, Head of our Tobacco Control Research Group and part of the UK Centre for Tobacco and Alcohol Studies, will highlight serious flaws in the accuracy and reliability of Philip Morris International s (PMI) Project Star report on illicit cigarette trade within the EU.

This annual report is compiled by the accountancy firm KPMG, on behalf of the tobacco giant PMI, as part of a legally binding agreement reached between the company and the EU. In 2000, on the back of overwhelming evidence that smuggling formed part of major tobacco companies business model, two companies including PMI were taken to court in New York by the European Community. As part of the legal settlement reached, PMI is now required to produce an annual Project Star report.

However, by reviewing the findings presented in Project Star in conjunction with independent data, the authors of the Bath study highlight major concerns. They suggest

Project Star data tends to overestimate levels of illicit cigarettes in Europe

There is a lack of transparency surrounding the methodology used and the extent of PMI s control over the report, plus an over reliance on information supplied by PMI (some of which is highly inaccurate) with little external validation

Project Star data should not be relied on to measure illicit cigarette levels.

Professor Gilmore explains Within a ten year period, the tobacco industry has turned the issue of cigarette smuggling from a PR disaster in to a PR triumph in which it claims to be both the victim of the illicit tobacco trade and part of the solution. Yet growing evidence suggests that, just as in the past, the major tobacco companies are still involved in the illicit trade and still over supplying markets with their products in the knowledge they will leak into the illicit market.

The new study highlights that Project Star shows that a quarter of illicit cigarettes in Europe in 2010 were PMI s own brands, compared to just five per cent being counterfeited PMI brands and 10 per cent comprising leading illicit white brands . Despite this, PMI emphasises the problems of counterfeit and illicit whites, also used as an argument to counter tobacco control policies such as plain packaging for cigarettes.

More broadly the study raises concerns about the accuracy of tobacco industry empty pack surveys . These are the main means by which the industry attempts to measure illicit trade in cigarettes, yet, as the paper highlights, these surveys do not directly measure levels of illicit cigarettes but instead measure non domestic cigarettes. Indeed the paper suggests that there is growing evidence that empty pack surveys are designed to exaggerate levels of illicit cigarettes.

Luk Joossens, Advocacy Officer for the Association of European Cancer Leagues, added «Project Star data cannot be used to estimate the illicit cigarette market in the EU because the report was commissioned to meet specific terms of reference which are only known to Philip Morris International and KPMG.»

Professor Gilmore and Mr Joossens will be speaking at a European Parliament event on cigarette smuggling, taking place in Brussels from 9am (Brussels time GMT 1) today (Wednesday 22 January). For more information see .

To access a copy of the latest study Towards a greater understanding of the illicit tobacco trade in Europe a review of the PMI funded Project Star , see

Additional notes

The illicit cigarette market comprises genuine tobacco company brands which have entered the illicit market, counterfeited cigarettes and so called illicit whites cigarettes manufactured legally but without a legitimate market and which are sold almost entirely in the illicit market.

Non domestic cigarettes are cigarettes not originally intended for the market in which they are consumed. They comprise illicit cigarettes plus non domestic legal cigarettes which may have been purchased duty free or in neighbouring European countries for personal use, or brought in by tourists.

Around the time of the authors FOI request for the Project Star report, PMI also placed a version of the same report on its website for the first time. The date of the report which forms the basis of this study is 24 May 2011 the online report added by PMI is 22 August 2011. Substantial sections of both appear to have been redacted, indicating that both copies only provide partial results.

The UK Centre for Tobacco Control Studies (UKCTCS) is a network of nine universities in the UK working in the field of tobacco control whose main activities are original research policy development advocacy teaching and training.

Future of e-cigarettes in question on european crackdown — businessweek

Just when smokers thought it was okay to inhale again, a debate over the safety of electronic cigarettes is threatening to cut off their nicotine.

Smokeless and odorless e cigarettes are catching on, touted in the U.S. and Europe as less harmful than real ones because they don t contain tar, arsenic and other cancer causing toxins. Yet a U.K. government decision this week to treat the steel tubes as a medicine and a plan by France to ban them from public venues raises questions about what health risks the devices carry.

E cigarettes, on the market in the U.S. and Europe since 2006, are battery powered devices that deliver vaporised nicotine and light up when puffed. Faulty e cigarettes have been known to explode, causing second degree face burns, U.K. health regulators said earlier this week. And because e cigarettes give a dose of nicotine to users, there s growing concern that the device can become addictive.

Current controls look at battery safety, electrical safety, but they don t focus on what s in the product and how it s delivered, said Jeremy Mean, a risk management official at the U.K. s drug regulator.

That s a warning shot for the small yet fast growing e cigarette market. The sector will approach $2 billion in sales by the end of 2013, and may exceed $10 billion by 2017, according to Bonnie Herzog, an analyst at Wells Fargo & Co. in New York. Demand for the smokeless devices may surpass that of traditional cigarettes in the next decade, Herzog said.

As manufacturers and tobacco companies step up their e cigarette advertising in the U.S. and as the device gains popularity on both sides of the Atlantic, the biggest concern among British and French health officials is so far unproven that e cigarettes could lead users to graduate to the real thing.

European Template

E cigarettes must become an aid to quit smoking, not a tool to enlarge the number of smokers, said Jean Louis Touraine, a Socialist lawmaker, doctor and expert on health care policy. They are becoming a fad, and many young people are being attracted to them.

In the U.S., the Food and Drug Administration intends to propose a regulation that would expand its authority over e cigarettes, though no time table has been set, according to Jenny Haliski, a spokeswoman for the agency. Regulators in Europe are moving more quickly. And the U.K. decision will probably serve as a template for a European Union ruling, said Erik Bloomquist, an analyst at Berenberg Bank.

In the U.K., the devices will be licensed as medicines by 2016 and overseen by the Medicines and Healthcare Products Regulatory Agency, which will require manufacturers to present data on the quality of their products, on how they deliver nicotine to the body and on how they compare with other nicotine replacement products, the agency said June 12.

Reduced Cravings

E cigarettes have been shown to reduce cravings and withdrawal symptoms, leading some people to cut down on smoking. And existing research has found no connection to heart disease.

Still, the devices use ingredients that can irritate the airways and cause allergic reactions, the German Cancer Research Center noted earlier this year. A study by scientists at the University of Athens found that they trigger an increase in airway resistance that lasts 10 minutes, making it harder for participants to breathe.

French Healthcare Minister Marisol Touraine said May 31 she plans to ask the country s highest administrative court to look at the legality of banning the devices in public places. Touraine cites the potential long term health impact, nicotine content and possible introduction to smoking as reasons to regulate devices that strikingly resemble cigarettes.

Some public health experts say the urge to take the safe route with e cigarettes risks is causing more harm than good.

Hand Grenades

We should be doing everything to encourage smokers to shift to new nicotine products, said Gerry Stimson, an emeritus professor of health behavior at Imperial College in London. The desire to make them safer is leading to over regulation and it will in effect turn them into a medicine and make them harder to obtain than cigarettes. It s a shame.

Many former smokers agree. This is effectively condemning people to going back to smoking cigarettes, says Dave Dorn of Sunderland, in northeast England, who adopted the smokeless tubes four years ago. Dorn, who produces an Internet broadcast program on e cigarettes called Vapour Trails that features ads for the devices, says none of those currently for sale will meet the U.K. s new regulations.

Poor Comparison

Adrian Everett, chief executive officer of closely held Zandera, says e cigarettes should be viewed as a tobacco alternative, not a smoking cessation tool. He objects to drawing parallels with the real thing.

To compare electronic cigarettes to tobacco cigarettes is like comparing playing football with juggling live hand grenades, he said in a telephone interview.

Amid evidence that more customers are adopting the product including Hollywood celebrities such as Charlie Sheen and Lindsay Lohan tobacco companies are also investing to counter declining sales of traditional cigarettes.

Lorillard Inc. (LO US) based in Greensboro, North Carolina, last year acquired Blu Ecigs for $135 million. Altria Group Inc. (MO US) of Richmond, Virginia, has said it plans to introduce an e cigarette later this year.

The U.K. decision may give tobacco companies and larger e cigarette companies the upper hand by mandating a costly level of product scrutiny, according to Berenberg s Bloomquist.

It s clearly a benefit for tobacco companies, he said. It will put in place requirements that they meet certain regulatory standards and they are the ones that will be able to do that.

Vapoteur Tips

In France, the product has struck a chord with people from Paris cafes to the old Mediterranean harbor of Marseille, where converts can be found sharing stories, drinks and tips on new e cigarette products and flavors.

More than 1 million people in France are now regular users, compared with 500,000 at the end of last year, according to a government commissioned report published last month. The country has more than 150 dedicated shops, according to the report, a number expected to double by year end. And users have coined a new verb to describe their smokeless puffing, the French vapoter.

Amaury Delamaire, a 20 year old student at the Sorbonne in Paris, says freedom to indulge in public places is a reason he switched.

There is no way I ll stop, Delamaire said as he popped into the AlterSmoke store in the Latin Quarter, one of the dozens of dedicated shops that have sprouted on Paris streets, for a refill. I ll just have to be more discreet.

Others aren t so sure.

Why switch to electronic if you can t use them in places where regular cigarettes are forbidden, said Marilyn Kaye, an American writer living in Paris. Regulators want to deny the right of people to enjoy themselves in a way that does not harm others. It s ridiculous.

To contact the reporter on this story Albertina Torsoli in Paris at atorsoli Makiko Kitamura in London at mkitamura1

To contact the editor responsible for this story Phil Serafino at pserafino