Philip Morris International Set to Invest Up to $650 Million in Israeli Cannabis Company

LOS ANGELES– Philip Morris International Inc., the renowned tobacco company behind the iconic Marlboro brand, is set to make a substantial foray into the cannabis industry. With a strategic eye on pain management, Philip Morris plans to invest up to $650 million in an Israeli cannabis company specializing in metered-dose inhalers. This move is part of the company’s long-stated objective of exploring opportunities within the marijuana sector.

According to reports from Calcalist, the investment will be carried out in stages. Initially, Philip Morris will inject $120 million into Syqe Medical, the Israeli firm it previously supported with a $20 million investment back in 2016. If this infusion proves sufficient for Syqe to complete its clinical trials and gain approval from the U.S. Food and Drug Administration, Philip Morris has committed to acquiring all the remaining shares of the company for $650 million.

The acquisition process will be executed through Philip Morris’ subsidiary, Vectura. Should the deal successfully conclude, it is expected to position Syqe as one of the largest players in the global cannabis market. At present, Syqe’s inhalers are exclusively available in Australia and Israel. While the product received approval in Canada two years ago, it appears to have yet to make it to market, as reported by MJBizDaily.

Philip Morris’ move into the cannabis industry aligns with its ongoing analysis of business opportunities within this space. It follows in the footsteps of other major tobacco companies that have ventured into the world of cannabis. Altria Group Inc. (NYSE: MO), for instance, made a significant entry into marijuana in 2018 by investing $1.8 billion in the Canadian company Cronos Group. Similarly, British tobacco company Imperial Brands allocated $93.4 million to invest in Auxly Cannabis Group, another Canadian firm.

Philip Morris International’s venture into the cannabis sector signals a strategic shift for the tobacco industry, as it seeks to diversify its offerings amid changing consumer preferences and the growing acceptance of cannabis for medical purposes. This significant investment in Syqe Medical could potentially pave the way for breakthroughs in pain management and solidify Philip Morris’ presence in the evolving global cannabis market.