The push for $1 billion is on.
To accomplish its short-term goal, London-based British American Tobacco (BAT) plans to continue invading the U.S. vaping market. The world’s second-largest tobacco and e-cigarette producer with a market cap of approximately $126.2 billion, BAT remains poised to unveil its new carbon-tipped tobacco heating device, Eclipse, in the U.S. in 2018.
The move is intended to put more pressure on rival Philip Morris in a battle for supremacy in the world’s largest vaping market. The industry giants are competing for customers who favor heated tobacco over nicotine-infused e-liquids, according to The Telegraph.
Reuters reported BAT was issued a “substantial equivalence” thumbs up by the U.S. Food and Drug Administration for Eclipse.
Philip Morris’ top vaping product, iQOS, currently has an application pending on reduced risk labels. The BAT Eclipse will not open litigation to gain such a label, according to The Telegraph.
“We are delighted to be the first tobacco company to be able to launch a THP (tobacco heating product) proposition in the United States,” BAT CEO Nicandro Durante said.
Reporting better-than-anticipated profits last week during the first half of 2018, BAT (NYSE:BTI) saw its shares rocket up five percent. It appears the 1H18 results were buoyed by its 2017 acquisition of Reynolds Americans, The Telegraph reported. BAT last year completed the $49.4 billion acquisition of Reynolds, in part, to gain a greater U.S. footprint.
Durante described to Reuters the proposition of introducing Eclipse, a disposable cigarette-looking device that heats – not burns – tobacco, to a test market during the fourth quarter of 2018. It likely will be released to the public in 2019 and Durante believes BAT’s new vapor-based devices will eventually help the company exceed $1 billion in annual revenue, according to The Telegraph.
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