A Vectura group logo is visible on a smartphone and a PC screen.
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Philip Morris International plans to sell a stake in its largest pharmaceutical unit.
The tobacco company, which makes Marlboro cigarettes, made a push into healthcare and wellness in 2021 with the acquisition of Vectura, a UK-based pharmaceutical company that makes inhaled and inhalers.
But more recently the division has struggled and Philip Morris has held discussions with Deutsche Bank about a series of options to try to grow its wellness and healthcare division, the Wall Street Journal.
The company is looking for a new partner to help grow Vectura and is considering various options, including a licensing or royalty agreement, a commercial partnership, or the sale of a majority or minority stake in the company.
In recent years, Philip Morris has also acquired Fertin Pharma, a maker of nicotine gum, and OtiTopic, a maker of respiratory medications.
The three deals, which total more than $2 billion, are part of the company’s broader, long-term focus on developing smoke-free products and medicines aimed at treating respiratory diseases commonly associated with smoking.
These acquisitions, however, triggered negative reactions from the public health sector. In the second quarter of this year, the company took a $680 million writedown related to its wellness and healthcare division.
At the time of the Vectura deal, Philip Morris said the acquisition would expand its Beyond Nicotine business and help the division achieve its goal of generating at least $1 billion in revenue. net sales from these products by 2025. Following these setbacks, Philip Morris returned to this goal and said it would begin reducing its investments in the division.
The company, during its second-quarter earnings conference call, said it would “nevertheless remain committed to growing” its wellness and healthcare businesses and planned to “accelerate the growth of Vectura and would explore potential partnerships.
The news comes as the tobacco company continues to face resistance from public health groups. This week, Philip Morris saw its CEO removed from the list of participants at the annual Concordia Summit, a side event to the United Nations General Assembly held every September in New York, after health experts refused to speak at the conference to protest his presence.
Concordia has also canceled Philip Morris’ membership of the conference with immediate effect.