The impact of industry behavior in US nicotine-delivery product markets on the use of nicotine-delivery products

Prof Levy will begin with an overview of the market structure in the US for cigarettes, e-cigarettes, and oral nicotine pouches (ONPs). Competition by independent ENDS firms had important effects on the cigarette market. Marketing expenditures for cigarettes by firms in the highly concentrated US industry rapidly increased from 2014-2022 as adult e-cigarette prevalence rapidly increased. Independent (non-cigarette firms) played an important role over the same period in the rapid decline in cigarette use, especially among youth and young adults. However, e-cigarettes marketed illegally imported by firms from China also played an important role, fostered by the FDA’s lack of PMTA approvals for flavored e-cigarettes. Meanwhile, ONP sales have grown rapidly over the past five years, but their impact on cigarette use remains unclear. While ONPs may act as a substitute for cigarettes, they may also have encouraged dual use with cigarettes. With its takeover of much of the ONP market and its prohibition on selling cigarettes in the US, PMI plays a central role in challenging US cigarette firms. However, they also have strong incentives to promote heated tobacco products (HTPs). The cigarette, ENDS, ONP, and HTP markets will need to be monitored and a coordinated strategy will need to be developed in future years.