Big Tobacco's Philip Morris May Acquire a Medical Pot Company For $650 Million
As cigarette sales continue to plummet, Big Tobacco is investing more and more cash into the legal cannabis industry.
Published on July 20, 2023

Marlboro cigarettes manufacturer Philip Morris is about to invest more than half a billion dollars into the medical cannabis industry, Calcalist reports.

The global tobacco megacorp is reportedly working on a deal to acquire Syqe Medical, an Israeli company that has developed a unique metered-dose cannabis inhaler. In the first phase of its plan, Philip Morris will invest $120 million into helping Syqe obtain US FDA approval for its cannabis inhaler. If the inhaler passes the necessary clinical trials and is approved for sale, the tobacco company has agreed to pay up to $650 million to fully acquire Syqe. 

The deal could potentially be a milestone for the tobacco and cannabis industries. If the FDA signs off on the inhaler, Syqe would become the first company to receive federal approval to sell medicinal raw cannabis inflorescence in the US. The deal would also mark one of Big Tobacco’s largest investments into the cannabis industry and one of the biggest investments ever made into Israel's thriving medical marijuana industry. The final acquisition would also make Syqe one of the ten most valuable cannabis companies in the world.

Philip Morris is one of the largest cigarette manufacturers in the world, currently valued at $154 billion on Wall Street. But now that cigarette sales are plummeting, the tobacco giant has launched a “beyond nicotine” strategy to help it survive into the 21st Century. In 2021, the company spent over a billion pounds to acquire Vectura, a British company that develops smoke-free inhalers. Philip Morris has also been tentatively exploring inhalable cannabis products for years now, having first invested $20 million into Syqe back in 2016. 

Other major cigarette companies are also rushing to invest their money into a greener future. Altria Group, which actually owns Philip Morris, already invested $1.8 billion into Canadian cannabis firm Cronos Group back in 2018. UK-based tobacco company Imperial Brands invested over $100 million in the Canadian pot market in 2019, and Camel and American Spirit manufacturer British American Tobacco invested over $175 million in Organigram, another Canadian pot company, in 2021.

This new rush of investments is raising concerns that Big Tobacco could eventually dominate the legal cannabis industry. If the US government were to eventually legalize weed, these massive corporations would be free to spend their inexhaustible resources on marketing and selling legal cannabis products. The companies' existing infrastructure would make it easy for them to distribute products throughout the nation, potentially putting smaller cannabis startups out of business.

Advocacy groups have noted that many major corporations, including Big Tobacco, Amazon, and some leading alcohol companies, are all actively lobbying Congress to legalize weed. But of course, these companies are also working to ensure that they would be the first to profit from legalization. Concerns about a corporate cannabis industry takeover have led concerned Senators like Elizabeth Warren and Chuck Schumer to consider rolling anti-monopoly restrictions into federal cannabis reform bills.

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Chris Moore
Chris Moore is a New York-based writer who has written for Mass Appeal while also mixing records and producing electronic music.
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