The Scoop: Philip Morris International sells inhaler company after backlash

Three years ago, Philip Morris International, the manufacturer of many brands of cigarettes, including Marlboro, purchased Vectura, a British pharmaceutical brand that makes inhalers. The move faced harsh backlash at the time.

“We are deeply concerned that PMI will use the inhalation services technologies developed by Vectura to make their tobacco products more addictive,” a joint statement from the American Lung Association and American Thoracic Society said in 2021. “We are also deeply troubled that this company could further profit from the disease their products have caused by now selling therapies to the same people who were sickened by smoking PMI cigarettes.”

Now, PMI is selling Vectura, citing “the unreasonable burden of external constraints and criticism related to our ownership.”

In other words, bad PR.

PMI had explained its purchase as part of its “Beyond Nicotine” initiatives, a pledge to phase out cigarettes completely. Currently, 38% of PMI’s revenue comes from “smoke-free products,” the company said, with a goal of reaching 66% by 2030.

Why it matters: This is a fascinating ethical and PR quandary.

PMI is attempting to move beyond its current sales of harmful cigarettes, but it still currently reaps mounds of cash from tobacco. Diversifying into other fields is commendable, but the gap between its aspirations and investments was just too far. Smoking can trigger asthma attacks, so investing in a company that treats asthma can seem hypocritical, as the joint statement indicates. Even the best PR campaign in the world would have a tricky time convincing the public and the researchers who would work at Vectura that PMI had pure intentions with the investment, even if it’s true.

This situation makes the case for bringing in PR at the very earliest phases of mergers and acquisitions. These issues should have been flagged from the very moment the idea was floated, and their counsel considered just as deeply as those of the number crunchers. An honest assessment of the chances of swaying opinions on the topic needed to be performed and carefully considered. If the plan went through, an aggressive PR push needed to accompany every step of the M&A process.

Perhaps that all happened. But it wasn’t enough. And now the company is being sold at a loss of hundreds of millions of dollars.

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Allison Carter is editor-in-chief of PR Daily. Follow her on Twitter or LinkedIn.