R.J. Reynolds Scales Back Marketing of Dissolvable Tobacco Products

Source from:  Winston-Salem Journal 08/01/2013

After spending more than 4 1/2 years in five test markets, including Charlotte, R.J. Reynolds Tobacco Co. has struggled to gain consumer traction for its trio of dissolvable tobacco products.

It has struggled to the extent that it is limiting future marketing of the products: a pellet (Camel Orbs), a twisted stick the size of a toothpick (Camel Sticks) and a film strip for the tongue (Camel Strips).
 
The goal has been making its tobacco products more accessible within a society that's clamping down on smoking. Reynolds began testing the dissolvable products in early 2009.

By comparison, Reynolds needed just 2½ years, from April 2006 to October 2008, to take its Camel Snus products from test markets to national distribution.

Reynolds spokesman Richard Smith said the products remain in limited distribution in Charlotte and Denver at point-of-sale sites and through its age-verified website for　consumers,　www.cameldissolvables.com.

"At this time there are no plans for any marketing beyond these channels," Smith said. "We've found in our conversations with adult tobacco consumers that while there's strong interest in the category, a different product form may present a better option over the long term.

"Though for now, Camel Sticks, Strips and Orbs will remain available while we continue to gather learnings."

The setback is noteworthy because Reynolds has carved out an important and profitable niche as the industry's leading manufacturer of innovative smokeless products.

The dissolvable products are made of finely milled tobacco and come in flavor styles of fresh and mellow. The products last from two to three minutes for the strips, 10 to 15 minutes for the orbs and 20 to 30 minutes for the sticks. They carry the same health warnings as other oral smokeless products.

The products were sold initially in Columbus, Ohio, Indianapolis and Portland, Ore., before being shifted to Charlotte and Denver in March 2011. Although Reynolds does not dictate retail prices, the company said the dissolvable products should sell at a comparable price to a tin of Camel Snus, which is between $4 and $4.50.

The products have drawn criticism from the Campaign for Tobacco-Free Kids, which has protested most Reynolds tobacco innovations in recent years. "These products are flavored and packaged like candy, and very likely will appeal to children," said Matthew Myers, president of the advocacy group.

Reynolds has sold the dissolvable products in child-resistant packaging, which may have proven to be a detriment to sales, according to analysts.

"The test markets weren't good, and Reynolds made the products impossible to open without scissors," said Bill Godshall, executive director of Smoke Free Pennsylvania.

John Spangler, a professor of family and community medicine at Wake Forest School of Medicine, said he is not surprised the dissolvable products have not spurred consumer demand. "My thought would be that the market for spit-less, non-combustible tobacco is probably already taken up by snus," Spangler said.

The FDA's Tobacco Products Scientific Advisory Committee said dissolvable products could provide a societal benefit in reducing disease from tobacco use by decreasing the number of smokers through cessation or preventing the first use of cigarettes.

It cautioned that increased use of dissolvable products also could lead to more smokers by serving as a bridge to cigarettes and/or reducing societal concern about the potential health risks of tobacco products in general.

The Food and Drug Administration was given oversight of the tobacco industry by Congress in 2009, but it cannot ban nicotine or tobacco.

The FDA's Center for Tobacco Products is charged with evaluating applications for new "modified risk" tobacco products. Products that could fit in that category include the dissolvable products and the Vuse vapor cigarette made by R.J. Reynolds Vapor Co.

A company that wants to market a lower-risk tobacco product in the United States must offer scientific proof to the FDA that the marketing of the product will not only reduce harm to individual users, but also benefit the health of the population as a whole.

In March 2012, the committee determined that people who exclusively use dissolvable tobacco products have a greatly reduced risk of cancer and respiratory illness compared with those who regularly smoke cigarettes. Enditem