BAT Abandons Nicotine Inhaler to Focus on Vaping

British American Tobacco (BAT) (BATS.L) has abandoned plans to launch a nicotine inhaler as it focuses on consumer products such as e-cigarettes rather than healthcare products.

The decision came after the commercial launch of the inhaler Voke was delayed due to manufacturing issues. Voke, developed by BAT in partnership with its original developer Kind Consumer, was the first e-cigarette-like product approved by the UK medicines regulator as a prescription medical aid for people trying to quit smoking.

BAT, the world's second-largest international tobacco company, said on Thursday that it would transfer manufacturing, intellectual property, and know-how assets to Kind Consumer, which would license the product in return for deferred contingent payments. Financial details were not disclosed.

Kind Consumer said in a statement that it would seek a new global partner, or possibly several regional partners, to accelerate sales of the nicotine inhaler this year.

Consort Medical (CSRT.L), the supplier of the inhaler, said on Tuesday that BAT had terminated the supply agreement after the product failed to launch in 2016, but added that it was still in discussions with BAT and Kind regarding the product's future.

BAT, which is in talks over a $47 billion acquisition of U.S. rival Reynolds American (RAI.N), said its next-generation product strategy would focus on Vype e-cigarettes and glo heated tobacco products.

Like e-cigarettes, Voke uses liquid nicotine, but unlike e-cigarettes it does not use a battery to heat it into vapor.