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Vinayak M Prasad (World Health Organization) - #BigTobacco should be taxed more to pay for the health costs of smoking

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There are more than a 1.1 billion smokers in the world, and it’s estimated that 8 million people die every year as a result of their addiction to cigarettes. By any reasonable metric, smoking is perhaps the greatest and most salient public health emergency of our time. The scale of this crisis is magnified even more by the pervasive influence of tobacco companies, which have stopped at nothing to derail regulations, confuse policymakers and obscure the plight of their products.

Which is why only through continuous efforts spearheaded by the World Health Organisation have major breakthroughs in the fight against smoking been achieved. Ever since the entry into force of the Framework Convention on Tobacco Control (FCTC) in 2005 and its first Protocol to Eliminate Illicit Trade in Tobacco Products in September of 2018, the fight against Big Tobacco’s influence and underhand tactics has managed to score some much-needed wins for public health. The election in 2017 of Dr. Tedros Adhanom Ghebreyesus to the post of Director General of the WHO was pivotal in this regard. As the first DG from Africa, a continent seen as key for Big Tobacco’s profits, Dr. Tedros has made tobacco control a top priority of his term.

For World No Tobacco Day, EuReporter caught up with Dr. Vinayak M Prasad, who leads the WHO’s Tobacco Free Initiative (TFI). Dr. Prasad, one of the architects of the FCTC Protocol, has been involved in tobacco control policies, with a focus on illicit trade since the early 2000s.

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1/ On 'World No Tobacco Day', you said that the prevalence of smoking has gone down from 27% to 20% in 2016. But the number of tobacco users worldwide has remained stable at 1.1 billion because of population growth. You said also that the global economic cost of using tobacco is $1.4 trillion. At the same time, the total profit of the 4 tobacco majors continued to increase, reaching €18 billion at the end of 2018. Can it be said that tobacco companies make money through smokers, but also through non-smokers who finance the social cost of tobacco?

Tobacco companies do not pay the social and economic costs of selling their harmful products—smokers do, but only partially. In most countries, tobacco excise revenues are lower than the social and economic costs of producing and consuming tobacco products. For this reason, non-smokers finance part of the health costs of tobacco-related diseases and premature mortality.

Social and economic costs of tobacco have impacts on social welfare and potential medium-term growth.  Costs of tobacco consumption are normally higher than benefits, the welfare loss is being paid by smokers and non-smokers. Additionally, dynamic welfare loss related to premature mortality and productivity reduction is paid by societies in terms of lower potential economic growth.

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2/ Is it possible to oblige tobacco manufacturers to pay part of the health costs of tobacco in the countries where they are present? Some countries/health systems in the Americas (after the US and Canada, Brazil just launched a lawsuit) are going this way but it does not seem to be possible in all jurisdictions. Shouldn’t there be a united international front against that such as under the FCTC? Moreover, shouldn't the stock market value of the 4 tobacco companies become an indicator of the effectiveness of anti-tobacco policies: if the value rises, it is because anti-tobacco policies are not efficient enough, if it plummets, it is because they are becoming effective?

One way to oblige tobacco manufacturers to pay part of the present and future health costs would be through a special rate of corporate income tax. However, obliging tobacco manufacturers to pay part of the health care costs of tobacco is not likely to work in all jurisdictions.

Stock prices reflect a number of variables other than the prevalence of tobacco use. With population growth, declines in prevalence of tobacco use does not necessarily reflect a decline in total use. Additionally, tobacco companies have many strategies for increasing their profitability and avoiding the restrictions of tobacco control policies. As global holdings, their profits depend on the balance of countries with well implemented and poorly implemented tobacco control policies.

The industry responds to tobacco control restrictions and tax policy by increasing the profit margin per pack. At the national level, companies could be increasing their profitability through exports to less controlled countries or, alternatively, high profit margins per pack of cigarettes. In this case, a country may have strict tobacco control policies, but tobacco products may be highly profitable with a high stock market value.

The WHO report on tobacco and its environmental impact highlights industry accountability the potential for the producer to cover part or all of the expenses for the collection, recycling or final disposal of products manufactured as part of producer responsibility.

The best way to address this is by continuing to implement the tobacco control policies outlined in the WHO FCTC to reduce the demand for tobacco, as well as its negative impacts on individuals and societies.

Article 19 of the WHO FCTC on liability gives Parties the possibility to recover health care costs, provided that they have the necessary national legislation in their own legal systems. That means that in some Parties it is possible to start litigation proceedings on this ground, but in others it is not.

3/ What is the status of implementation of the Protocol "to Eliminate the Illicit Trade in Tobacco"

The Protocol to Eliminate Illicit Trade in Tobacco Products, came into force in 2018. Any further update on the implementation of Protocol may be obtained from the FCTC Secretariat. (EU Reporter emails to the FCTC Secretariat were not answered).

4/ How does WHO protect itself from direct or indirect lobbying by the tobacco industry? are the funding from the Gates Foundation as well as Bloomberg philanthropies sufficient to ensure the process is immune from indirect industrial influence?

At the Sixty-Ninth World Health Assembly, WHO adopted the Framework of Engagement with Non-State Actors (FENSA), where a specific provision was established prohibiting engagement between WHO and tobacco companies, as well as their supporters. When an engagement with non-State actors is being considered, standard due diligence and risk assessment is initiated by the technical unit to establish whether such an engagement would be in the interest of the Organization and in line with the principles of WHO’s engagement with non-State actors. Prior to the adoption of FENSA, WHO had established a complete firewall against the tobacco industry built on the strong foundation of Article 5.3 of the Framework Convention on Tobacco Control and its guidelines.

5/ The WHO is doing an incredible job in tobacco control regulation, but is environment protection also included in this work? We are aware of the massive environmental issues associated with tobacco companies. Shouldn’t the UN perhaps consider enlarging the WHO scope to environmental issues (ie, the World Health and Environment Organization)?

The UN Environment Programme (UNEP) is the leading global environmental authority setting the global environmental agenda. Within WHO, there is work being done to reduce environmental and social risk factors, and some work has been done to address the environmental concerns of tobacco. WHO has supported the elimination of single-use plastic, found in tobacco products with filters like cigarette butts, and drawn attention to the serious environmental consequences of deforestation for growing tobacco[1].

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Vaping flavour bans prove own goal for public health advocates

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The Canadian federal government recently published draft regulations to ban almost all e-cigarette flavours across the nation, with only tobacco and mint/menthol flavours left untouched. The proposal would also see most flavouring ingredients, including all sugars and sweeteners, banned from use in vaping products, writes Louis Auge.

The bill’s intended purpose is to protect public health by making vaping less appealing to young people. The available evidence, however, suggests that not only could the measure fall short of the mark, it could actually cause more problems than it solves, prompting both young people and adults to take up smoking conventional cigarettes, a far more harmful practice than vaping. Indeed, a recent study by the Yale School of Public Health (YSPH) suggested that, after a San Francisco ballot measure banned flavoured vape liquids in 2018, smoking rates increased in the city’s school district after years of steady decline.

Even after adjusting for other tobacco policies, the study found that San Francisco high school students’ odds of smoking conventional cigarettes doubled in the wake of the ban on flavoured vapes. Other studies, meanwhile, have illustrated how flavours are instrumental in prompting adult users to abandon conventional cigarettes—one 2020 study found that adults who used flavoured e-cigarettes were more likely to quit smoking than those who used unflavoured (or tobacco-flavoured) e-cigarettes.

Even more staggering is the fact that Canada’s own assessment of the proposed ban on e-cigarette flavours admits that the measure would likely cause some adults to smoke more. Some consumers aged 20 and over who currently use flavoured vaping products, Health Canada acknowledged, would not substitute the flavours they prefer with tobacco- or mint-flavoured e-cigarettes, and instead would choose to purchase more conventional cigarettes.

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The startling admission from Canadian authorities really brings home the fact that flavour bans will almost certainly lead to a proportion of users abandoning their vaping devices to take up conventional cigarettes instead—with potentially ruinous public health consequences. It should be a stark warning for countries across the Atlantic, given that several European governments, including Finland and Estonia, have already banned vaping flavours—or are working furiously to push through similar legislation.

The Netherlands is one such example, where health secretary Paul Blokhuis announced last summer that he planned to ban all non-tobacco vape flavours in the country. A public consultation on the issue drew in a record number of responses and yielded a near-unanimous consensus: an overwhelming 98% of respondents were opposed to the ban. Nevertheless, Blokhuis’ measures could take effect as early as next year.

The move is a paradox in the making for the otherwise liberal country, with the Netherlands concurrently pushing major stop-smoking campaigns like STOPtober to get tobacco users to put out their cigarettes for good. By banning flavoured e-cigarettes, the Netherlands risks

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jeopardising this progress and sending smokers away from vaping—a practice which is, according to research commissioned by Public Health England, roughly 95% less harmful than smoking combustible tobacco.

That these flavour bans threaten to push smokers back to combustible tobacco products could spell disaster for the EU’s efforts to have a tobacco-free generation by 2040. Despite considerable effort on the part of public health authorities, progress toward this goal has been less than promising: 23% of the overall population still use conventional cigarettes, and almost a third of young Europeans smoke. Europe now has less than 20 years, then, to help nearly 90 million smokers give up the habit.

Failure to achieve this objective could have serious public health consequences. Across Europe, more than 700,000 deaths annually, and a quarter of all cancers, are currently attributed to smoking; unsurprisingly, the bloc is keen to eliminate “the single largest avoidable health risk” via all means possible. As such, the Tobacco Products Directive has been active for a half-decade, and utilises a range of tools to dissuade smokers including health warnings, a track and trace system, and educational campaigns.

All of these measures, however, have not driven smoking rates down sufficiently, and top European officials have acknowledged that significant additional measures will be necessary to achieve the dream of a smoke-free generation. As studies have shown and Health Canada has now admitted, banning the very flavours which make e-cigarettes an attractive option for smokers who are seeking to reduce their health risks yet are unwilling or unable to quit nicotine altogether would likely push many consumers to buy more cigarettes. If this halted— or even reversed— the decline in smoking rates across Europe, the flavour bans could prove to be a dramatic own goal for public health, setting the EU’s efforts to curb smoking back years.

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Plain packaging not the panacea policymakers have been looking for

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A new study by researchers from LUISS Business School and Deloitte in Rome analyses the effectiveness of plain packaging for tobacco products in the UK and France and comes to a sobering conclusion.

EU Reporter wanted to find out more and sat down with the researchers.


EU Reporter: Thank you for agreeing to this interview. This is the second analysis by your group on the effectiveness of plain packaging. The first time you looked at Australia. This time, you focused on the UK and France, two countries that implemented plain packaging to curb cigarette consumption three years ago. Can you summarise how you approached the analysis and the methodology used for the report?

Professor Oriani: Thank you for having me. Our analysis is based on cigarette consumption statistics that span more than three years of full implementation of plain packaging in the UK and France. So far, ours is the only study that we are aware of that has used data from such a long time period.

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We used three methods to assess whether the introduction of plain packaging had a significant impact on cigarette consumption in both countries.

Firstly, we performed a structural break analysis to test whether the introduction of plain packaging led to a change in the cigarette consumption trend.

We then performed a structural model estimation, to confirm if plain packaging can be associated with a reduction in cigarette consumption after alternative influencing factors, such as price, are controlled for.

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Finally, we estimated a difference-in-differences regression equation for cigarette consumption that allowed us to assess the differential impact of plain packaging in France and the UK with respect to comparable countries that have not introduced plain packaging.

EU Reporter: What were the main findings of the research?

Professor Oriani: We found that the introduction of plain packaging has had no impact on cigarette consumption trends in the UK or France.

The estimation of the structural model showed that after controlling for alternative influencing factors , plain packaging has had no statistically significant impact on cigarette consumption in both countries. Finally, the difference-in-differences regression shows that plain packaging has had zero effect in the UK, while it is associated with a statistically significant increase in per capita cigarette consumption of 5% in France, which is contrary to the intended goals of the regulation.

EU Reporter: That is very interesting. So, the evidence does not suggest that plain packaging reduces cigarette consumption?

Professor Oriani: Taken together, the data show that there is no evidence that plain packaging reduces cigarette consumption at any levels. None of the different models used showed a reduction in consumption of cigarettes because of plain packaging in the UK and France.

And indeed our research found some evidence of an increase in cigarette consumption in France, suggesting that plain packaging may have had a counterproductive effect on smoking levels.

We also have to keep in mind those smokers that switched to alternative products, such as e-cigarettes or heated tobacco products. Our analysis does not include them. The fact that we found that plain packaging had no effect even without taking account of the shift to alternative nicotine products, reinforces our results that plain packaging is ineffective.

EU Reporter: I mentioned your first study earlier. Can you compare the results of the Australian study on plain packaging to the results from the UK and French studies? What conclusions can we draw from such a comparison?

Professor Oriani: The results in this report are consistent with those presented in our previous study on the impact plain packaging has had on cigarette consumption in Australia. We used the same methodology and came to the conclusion in one of our models that plain packaging is associated with a statistically significant increase in cigarette consumption there, as well.

This shows that there is no indication that plain packaging reduces cigarette consumption. Also, there is some evidence that plain packaging may result in higher smoking levels, which is something we should try to avoid.

EU Reporter: As an expert, how do you recommend European policymakers approach the topic of plain packaging?

Professor Oriani: As the most in-depth and comprehensive study on plain packaging in the UK and France to date, our research can help inform European policymakers when considering which types of tobacco control measures to introduce. This and our previous studies do not confirm the hypothesis that plain packaging is an effective policy measure to reduce cigarette consumption. European decision-makers evaluating plain packaging should consider this to ensure they have a full picture of the potentially counterproductive impact and costs of plain packaging.

The study can be accessed here

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World No Tobacco Day 2021:

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“Tobacco use is the single largest avoidable health risk. It is the leading cause of preventable cancer, with 27% of all cancers attributed to tobacco. With Europe's Beating Cancer Plan, we are proposing bold and ambitious actions on prevention to reduce the use of tobacco. We have set a very clear objective - to create a smoke-free generation in Europe, where less than 5% of people use tobacco by 2040. This would be significant change compared to the around 25% today. And reducing the use of tobacco is crucial to reach this goal. With no tobacco use, nine out ten cases of lung cancer could be avoided.

"Many, if not the majority, of smokers have attempted to quit at some point in their lives. The latest Eurobarometer[1] figures speak for themselves: if we manage to support smokers trying to quit to follow this through successfully, we could already halve the smoking prevalence. On the other hand, three out of four smokers who quit, or tried to stop, did not use any help.

"The COVID-19 crisis has highlighted the vulnerability of smokers, who have up to a 50% higher risk of developing severe disease and death from the virus, a fact that has triggered millions of them to want to quit tobacco. But quitting can be difficult. We can do more to help, and this is precisely what this year's World Tobacco Day is about – committing to quitting.

"We need to increase the motivation to leave smoking behind. Stopping smoking is a win-win situation at all ages, always. We need to step up our game and ensure that EU tobacco legislation is enforced more strictly, especially as regards sales to minors and campaigns on giving up smoking. It also needs to keep pace with new developments, be sufficiently up to date to address the endless flow of new tobacco products entering the market. This is particularly important to protect younger people.

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"My message is simple: quitting is saving your life: every moment is good to quit, even if you have been smoking forever.”

[1] Eurobarometer 506. Attitudes of Europeans towards tobacco and electronic cigarettes. 2021

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