September 12, 2014 / 8:34 AM / 6 years ago

UPDATE 2-BAT's novel e-cigarette rival wins UK medical approval

* Cigarette-shaped Voke Inhaler wins licence from MHRA

* Licensing amendment needed before likely 2015 launch

* No heat or visible vapour, in contrast to e-cigarettes

* BAT unit working with Kind Consumer, Consort Medical (Adds analyst comments, more on product, backers)

By Ben Hirschler

LONDON, Sept 12 (Reuters) - A new nicotine inhaler to be sold by British American Tobacco has been licensed in the UK as a medicinal product, marking the arrival of a novel alternative to the fast-growing market for electronic cigarettes.

The cigarette-shaped Voke Inhaler represents a further move by one of the world’s biggest tobacco companies to defend its turf in a rapidly changing market. Since it involves no heat, electronics or battery it is not classified as an e-cigarette.

As a medicinal product delivering a precise dose of nicotine, it could be prescribed by doctors for patients trying to quit smoking. Industry analysts expect it to be launched in the first half of next year.

The uptake of e-cigarettes, which use battery-powered cartridges to produce a nicotine-laced vapour, has rocketed in the past two years and the market is estimated to be worth $3.5 billion a year - but there is fierce debate about the risks.

BAT, the world’s second-biggest cigarette maker with brands such as Dunhill and Lucky Strike, already sells a conventional e-cigarette called Vype, which was promoted in the first British TV adverts by a tobacco company in more than two decades.

The new Voke product was developed for BAT by Kind Consumer, a private company whose backers include former Tesco boss Terry Leahy, one-time Sainsbury chairman Peter Davis and venture capitalist Jon Moulton.

While Voke has a licence from the Medicines and Healthcare products Regulatory Agency (MHRA), the authority must approve a modified licence to allow full-scale commercialisation by BAT’s nicotine substitute division Nicoventures, the companies said on Friday.

Kevin Bridgman, chief medical officer at Nicoventures, said the additional licence was needed for automated manufacture and the further regulatory step was likely to take some months. Only after that will the product be ready for launch in Britain.

Eddy Hargreaves, an analyst at broker Canaccord Genuity, said the development of Voke showed how “Big Tobacco” was pursuing multiple nicotine alternatives, although he saw the new inhaler as smaller seller than e-cigarettes.

However, as the only e-cigarette-type device on the market with regulatory backing, Nicholas Keher of Investec said it could be “a game-changer”.


Voke contains a breath-activated micro-valve that does away with the need for electronics or heat and is licensed for use to relieve nicotine craving in smokers who wish to quit the habit.

It consists of a cigarette-sized stick in a box the size of a pack of 20 cigarettes, which also contains a pressurised canister containing 20 refills of pharmaceutical grade nicotine.

Shares in BAT’s partner Consort Medical, which has a manufacturing contract for the product and whose Bespak unit has experience in making asthma inhalers, rose more than 9 percent on news of the MHRA green light.

For BAT, whose shares were up 0.6 percent by 1200 GMT, the development of Voke is part of a strategy to hedge its bets as its core tobacco business declines in Western markets, where many consumers are quitting smoking.

Bridgman said Voke would suit many people who want to quit smoking but are still wary about e-cigarettes.

“The fact that it has been licensed by the medicines regulator provides the assurances around quality and safety that many smokers are seeking,” he told Reuters.

“I’m fairly confident that most e-cigarettes contain fewer toxins than conventional cigarettes, but the trouble is that without standards and without someone overseeing things then consumers can’t be sure.”

BAT is also looking at rolling out the Voke Inhaler in other markets, although Bridgman declined to go into details.

The device is seen as a competitor to both e-cigarettes and nicotine-replacement therapies, such as gum and patches, as well as Johnson & Johnson’s existing Nicorette Inhalator, which is not designed as an imitation cigarette.

The potential risks from e-cigarettes were highlighted by the World Health Organization last month, which called for stiff regulation as well as bans on their indoor use, advertising and sales to minors.

It is unclear how widely BAT’s new product will be accepted by consumers, since it offers a different experience to e-cigarettes. Unlike an e-cigarette, the Voke does not produce a visible vapour when inhaled, although it does reproduce other elements of smoking, including a typical “throat catch”.

Bridgman declined to say how much the new product would cost, citing commercial considerations ahead of its launch, but said it would be “competitive” with regular cigarettes. (Additional reporting by Paul Sandle; Editing by Greg Mahlich and David Clarke)

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