A Vectura Group logo is seen on a smartphone and a PC screen.
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Philip Morris International is considering selling off a stake in its largest pharmaceuticals unit.
The tobacco company, which makes Marlboro cigarettes, made inroads into the health care and wellness space in 2021 with the acquisition of Vectura, a U.K.-based pharmaceutical company that makes inhaled medicines and inhaler devices.
But more recently, the division has struggled, and Philip Morris has had talks with Deutsche Bank on a spread of options to attempt to grow its wellness and health-care division, The Wall Street Journal first reported.
The corporate has been searching for a recent partner to assist boost Vectura, and it’s contemplating different options including a licensing or royalties deal, a industrial partnership or a sale of a majority or minority stake within the business.
Lately, Philip Morris has also acquired Fertin Pharma, a nicotine gum maker, and OtiTopic, a respiratory drugmaker.
The three deals, which together totaled greater than $2 billion, were a part of the corporate’s broader, long-term pivot toward developing smoke-free products and medicines aimed toward treating respiratory diseases commonly related to cigarette smoking.
The acquisitions, nevertheless, triggered backlash from the general public health sector. Within the second quarter of this yr, the corporate took a $680 million impairment charge related to its wellness and health-care division.
On the time of the Vectura deal, Philip Morris said the acquisition would grow its “Beyond Nicotine” business and help the division achieve its goal of generating no less than $1 billion in net revenues from these products by 2025. Following the setbacks, Philip Morris walked back on that goal and said it will begin reducing its investments within the division.
The corporate, in its Q2 earnings call, said it nevertheless will “remain committed to developing” its wellness and health-care business and it plans to “speed up Vectura’s growth and might be exploring potential partnerships.”
The news comes because the tobacco company continues to face resistance from public health groups. This week, Philip Morris had its CEO faraway from the lineup on the Concordia Annual Summit, a side event to the United Nations General Assembly meeting held in Recent York every September, after health experts refused to talk on the conference in protest against his appearance.
Concordia also rescinded Philip Morris’ membership within the conference effective immediately.