PMI May Face Obstacles to Bringing IQOS into the U.S.
In May 2020, British American Tobacco filed lawsuits in the United States and Germany against its main competitor PMI, alleging that the tobacco-heating technology used in PMI's IQOS heated tobacco device infringed its patents. PMI began selling IQOS in t
In May 2020, British American Tobacco filed lawsuits against its main competitor PMI in the U.S. and Germany, claiming that the tobacco heating technology used in PMI's HNB device IQOS infringes its patents. PMI began selling IQOS in the U.S. in 2019, making it the only HNB device approved for sale in the country.
British American Tobacco explained that in the U.S., they have filed two patent infringement claims against PMI, one through the U.S. International Trade Commission (ITC) and the other in the Virginia federal court. The tobacco company claims it seeks damages for losses incurred and an injunction against the importation of the product.
Both lawsuits in Germany and the U.S. are based on allegations regarding the heating element technology used in IQOS, which is an earlier version of the technology currently used in British American Tobacco's Glo tobacco heating device. British American Tobacco plans to launch its Glo series products in Germany this year, while PMI began selling IQOS in the U.S. in 2019, making it the only HNB device approved for sale in the country.
A spokesperson for British American Tobacco, Will Hill, said: "If we win, unless they agree to obtain our patent license, Philip Morris will be able to obtain an import ban from the International Trade Commission, preventing IQOS from entering the U.S."
"We have seen media reports that British American Tobacco has filed lawsuits, but we have not had the opportunity to assess their allegations. However, we can say that we will vigorously defend ourselves," responded Philip Morris. Earlier this month, a six-day trial was held at the ITC in Washington, D.C., and an article from The Edge Markets revealed that the judge is expected to announce the findings of the investigation in May 2021.
Philip Morris stated: "British American Tobacco is attempting to ensure a ban on the importation of IQOS in the U.S. as part of a broader global strategy aimed at undermining the heated tobacco sector, which lags far behind IQOS, in order to protect its core cigarette business."
IQOS is crucial to PMI's business strategy
IQOS devices are a key part of Philip Morris International's business strategy, having performed significantly better than other heated tobacco products on the market.
He stated: "This is Philip Morris's most promising bet for the next future," and added, "The parties may resolve their respective court cases, and Philip Morris may agree to license British American Tobacco's patents."
