Buying Cigarettes and Quit-Smoking Aids From the Same Company?
How could that be? A look at the changing cigarette business.
Nov. 12, 2009 — -- Why would a cigarette company buy a firm that makes products to help smokers quit?
It's a question that's left many scratching their heads ever since reports surfaced that Reynolds American -- the no. 2 U.S. tobacco company and the maker of Camel, Kool and Winston cigarettes, among others -- is in talks to acquire Niconovum.
Niconovum, a Swedish company, makes nicotine gum and other nicotine replacement products designed to wean smokers off of cigarettes. It was founded in 2000 by Karl Olov Fagerström, who the company's Web site trumpets as "one of the world's leading experts on smoking cessation and nicotine dependence."
Purchasing the company "runs totally counter to the mission statement of (Reynolds American subsidiary) R.J. Reynolds," said Gregory Connolly, a Harvard School of Public Health professor who researches tobacco products. "I'm astounded."
An R.J. Reynolds spokeswoman declined to comment on the acquisition reports, saying, "We have a longstanding policy of not commenting on stories based on rumors or speculation."
Niconovum did not respond to requests for comment from ABCNews.com.
David Sweanor, the former counsel of Canada's Non-Smokers' Rights Association, said he's been hearing from industry contacts and others about the potential acquisition for months. To Sweanor, the buy would mark the next step in something tobacco companies have taken a heightened interest in recently -- marketing nicotine products other than cigarettes, namely smokeless tobacco.
Reynolds America bought 200 hundred-year-old smokeless tobacco maker Conwood Company in 2006.
Chief Reynolds rival Altria, the country's no. 1 cigarette company, earlier this year closed on its purchase of U.S. Tobacco, the firm behind leading smokeless tobacco brands Copenhagen and Skoal.
These moves could help get the companies off "an unsustainable path" and compensate for falling cigarette sales, Sweanor said.
To be sure, the market for smokeless tobacco is still a fraction of that for cigarettes. But the volume of cigarettes sold at grocery stores, drug stores and mass merchandisers such as Walmart declined more than 5 percent since last October and was down more than 7 percent the year before, according to market research giant Nielsen.
Both anti-smoking products and chewing tobacco have seen increased sales.
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