PMI Sells Vectura, Exits Asthma Inhaler Business

Philip Morris International is selling Vectura to Molex Asia Holdings for £150 million ($198 million) cash upfront and potential deferred payments of up to £148 million—about a third of the price it paid for the company three years ago. Vectura will be operated by Molex’ Phillips Medisize unit.

In 2021, PMI paid about $1.2 billion for the U.K. maker of asthma inhalers as part of its efforts to diversify into the pharmaceutical business.

The deal attracted heavy criticism from anti-smoking campaigners who said the cigarette manufacturer should not benefit from a company that offers treatments of ailments caused or worsened by tobacco products.

The fierce opposition played a roll in PMI’s decision to sell the unit at a loss. “Despite the investment and commitment to developing products and therapies vital to patients, unwarranted opposition to PMI’s transformation has impacted Vectura’s scientific engagement and commercial CDMO [contract developing and manufacturing organization] relationships.” PMI wrote in statement.

“With its experience in pharmaceutical drug delivery devices and its global manufacturing footprint, Phillips Medisize is best placed to lead Vectura into the future—while releasing it from the unreasonable burden of external constraints and criticism related to our ownership,” said PMI CEO Jacek Olczak.

Vectura is part of a “health and wellness” unit that also includes Fertin Pharma, the producer of a smoking-cessation aid, that PMI bought for about $820 million in 2021. Last year, PMI took a $680 million impairment charge on the unit after unsuccessful clinical trials and slower-than-expected development of other products.

Selling Vectura will allow PMI to “rid itself of a financially struggling unit,” said Kenneth Shea, a Bloomberg Intelligence analyst. “But it also represents a strategic backpedal to the company’s once-bold ambition to serve the inhaled therapeutics medical market,” he added.