No smoke without fire

Cessation therapy market lights up as anti-smoking legislation kicks in.

Smoking is on the decrease in the west, aided by the introduction of smoking bans across Europe and some of the US and targeted awareness campaigns highlighting the health risks and encouraging quitting. In 2003, the UK banned tobacco advertising, before banning smoking in public buildings in 2007. In April this year, the UK followed in the footsteps of Iceland, Thailand, Norway, Canada and Ireland in introducing a ban on displaying cigarettes in shops, in an attempt to reduce the appeal of smoking to youngsters.  This move has faced serious opposition from Big Tobacco and small retailers, who argue that restricting in-store promotion will hit their sales. However, one sector where the ban isn’t causing a drag is the smoking cessation market. With more and more smokers trying to put out their cigarettes, the opportunities for companies involved in making that process easier has grown steadily.

With smoking estimated to cause six million deaths per year through cancer and heart disease worldwide, the potential in therapies to aid quitting has been recognised in industry. According to GlaxoSmithKline, 70 per cent of smokers want to quit, but less than 5 per cent actually do, and encouraging people to quit represents a massive opportunity for companies willing to enter the market. The big guns have already made the most of this, with GSK and Pfizer dominating smoking cessation. As well as over-the-counter nicotine replacement therapies (NRTs), which can be marketed directly to the consumer, prescription cessation drugs have also entered the market, with Pfizer’s Champix and GSK’s Zyban. Champix generated revenues of £720m in 2011.

NRTs are particularly popular for kicking the habit, especially since the move from prescription to over-the-counter availability, and are still the main method used by smokers to quit – both GSK and Pfizer have made significant profits from over-the-counter prescriptions of NRTs, including patches, gum, lozenges and inhalers. GSK dominates with the brands Nicorette and NicoDerm in the US, and ploughed £30m into TV advertising for Nicorette in 2009–2010.

It hasn’t all been positive though for the industry – although the patient populations are increasing and driving overall revenues, confidence has been dented in prescription medication. Pfizer’s major product is Champix, which has hit the headlines multiple times as stories of patient suicides and mood swings have emerged, resulting in multiple lawsuits, negative media coverage and a decline in revenues between 2010 and 2011 of 5 per cent. The dramatic nature of the side effects has grabbed the attention of the public. More recently, concerns were raised over possible heart problems as a result of taking Champix. However, the controversial drug remains one of the more effective ways of quitting smoking. Safety concerns have also been raised for Zyban in similar areas.

The Asian markets present a considerable future opportunity for companies in smoking cessation, but awareness of the dangers of smoking and government intervention remain low in these regions. According to WHO estimates in 2010, Asia contains over half of the world’s smokers, while China has a male smoking prevalence as high as 53 per cent. These figures suggest that a considerable market for smoking cessation exists, but is as yet largely untapped because of cultural attitudes to smoking and a lack of public health efforts to combat the addiction by governments.

Overall, the smoking cessation market five years on from the ban is still growing at a healthy rate and is expected to continue to do so over the next five years. Anti-smoking legislation and the huge potential patient population are all driving the market even as the number of new smokers and the overall smoking population decline in Europe and the US. Should any companies in the future crack the Asian markets, this also offers a massive opportunity.

Amy Baker is a Life Science Analyst from GBI Research

Fading light: smoking on the decrease. Photograph: Getty Images

Amy Baker is a Life Science Analyst at GBI Research.

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Tony Blair won't endorse the Labour leader - Jeremy Corbyn's fans are celebrating

The thrice-elected Prime Minister is no fan of the new Labour leader. 

Labour heavyweights usually support each other - at least in public. But the former Prime Minister Tony Blair couldn't bring himself to do so when asked on Sky News.

He dodged the question of whether the current Labour leader was the best person to lead the country, instead urging voters not to give Theresa May a "blank cheque". 

If this seems shocking, it's worth remembering that Corbyn refused to say whether he would pick "Trotskyism or Blairism" during the Labour leadership campaign. Corbyn was after all behind the Stop the War Coalition, which opposed Blair's decision to join the invasion of Iraq. 

For some Corbyn supporters, it seems that there couldn't be a greater boon than the thrice-elected PM witholding his endorsement in a critical general election. 

Julia Rampen is the digital news editor of the New Statesman (previously editor of The Staggers, The New Statesman's online rolling politics blog). She has also been deputy editor at Mirror Money Online and has worked as a financial journalist for several trade magazines. 

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