Philip Morris International Inc. may make smaller deals to help build a multibillion-dollar health and wellness business by 2030 as global cigarette demand weakens.
The company will invest as much as $200 million annually over the next three years to develop a pipeline of health and wellness products, Chief Executive Officer Jacek Olczak said in an online presentation at the Consumer Analyst Group of New York conference.
“The emphasis is on organic product development to deliver these revenues, with the possibility of smaller bolt-on acquisitions and co-development and partnerships to complement,” he said.
Philip Morris has already made a series of acquisitions including inhaled-therapy maker Vectura Group Plc and Fertin Pharma, which produces a smoking-cessation aid, to bolster the health push. The company aims to generate more than $1 billion from products outside nicotine by 2025.
Olczak pointed to several focus areas in the pipeline. In healthcare, the company sees unmet patient needs for fast and effective treatments for cardiologic or neurological conditions, such as heart attacks or migraine headaches. Pain management with medical cannabis is another area of interest, Olczak said, although the company won’t be participating in recreational cannabis market.
In wellness, possible areas for expansion include sleeping aids, energy boosters, as well as smoking-cessation and anxiety products. The company is evaluating the use of the cannabis-based product CBD in some of these areas.
“We see opportunities to provide more effective solutions via consumer, over-the-counter and prescription pathways over time,” Olczak said. The healthcare offering will start to bear fruit by 2025, he said.