Philip Morris CEO: IQOS Holds 80% of Japan's Heated Tobacco Market, Growth Expected for Next Decade

Mar.17.2025
Philip Morris CEO: IQOS Holds 80% of Japan's Heated Tobacco Market, Growth Expected for Next Decade
CEO of Philip Morris International (PMI) indicates strong growth for IQOS in Japan despite pending tax hike.

Key points:

 

1. Philip Morris International (PMI) CEO Jacek Olczak stated that "IQOS" holds an 80% market share in Japan, with nearly 50% of smokers using the product. He expects the market to continue growing in the next ten years.

 

2. Japan plans to raise the tax rate on heated tobacco products to be equal to traditional cigarettes by 2026, with further increases scheduled for 2027. Olczak suggests that this policy may have a negative impact on consumers who have already switched to heated tobacco products.

 

3. Olczak said that heating tobacco can reduce the risk of exposing harmful ingredients by 90% to 95%, and existing data is sufficient to prove its positive impact.

 


 

2Firsts, reporting from Shenzhen - According to a report by Sankei on March 17, Jacek Olczak, the CEO of Philip Morris International (PMI), stated in an interview with Sankei that PMI's heated tobacco product, "IQOS", first launched in Japan 12 years ago, currently holds a market share of approximately 80% in the country.

 

Olsak pointed out that the use of heated tobacco among smokers in Japan is close to 50%, and the trend of shifting from traditional cigarettes to heated tobacco remains very active. He believes that the heated tobacco market will continue to grow over the next decade.

 

In addition, the Japanese government is planning to increase the tax rate on heated tobacco products to the same level as traditional cigarettes by 2026, and to continue raising taxes in 2027. 

 

This policy has raised concerns from PMI. Olczak pointed out that heated tobacco products are considered to pose lower health risks than traditional cigarettes, and in some countries in Europe and the Americas, governments encourage smokers to switch from traditional cigarettes to heated tobacco products through tax incentives. 

 

He believes that the government's tax increase policy in Japan may have a negative impact on consumers who have already switched to heated tobacco products, even "punishing" them for making a healthier choice.

 

During the interview, Olczak also elaborated on the current situation and prospects of heated tobacco in the Japanese market. 

 

He pointed out that heated tobacco maintains a double-digit annual growth rate in many markets globally, and Japan is transitioning from traditional cigarettes to heated tobacco at a faster pace than other countries. 

 

Currently, in ten major cities such as Tokyo, Sendai, and Fukuoka, the market share of heated tobacco has exceeded that of traditional cigarettes.

 

Despite facing challenges such as a decreasing population and shrinking market size, Olczak remains confident in the market outlook for heated tobacco products in Japan. 

 

He pointed out that since the introduction of heated tobacco products, nearly half of smokers have switched from traditional cigarettes. It is expected that the remaining smokers will take at least another 10 years to complete this transition, indicating that there is still significant growth potential in the market.

 

Regarding the Japanese government's policy of raising the tobacco tax rate to enhance national defense capabilities, Olczak said that from a global perspective of "Harm Reduction," many countries are promoting a shift from traditional tobacco to heated tobacco through taxation and regulation policies. 

 

He believes that the Japanese government should support consumers who have already made better choices, rather than hindering this process by increasing tax rates.

 

Olczak also responded to concerns about the lack of long-term clinical data on the health risks of heated tobacco. 

 

He pointed out that PMI has conducted studies showing that heated tobacco can reduce smokers' exposure to harmful components found in traditional cigarettes by 90% to 95%. 

 

He believes that even without long-term epidemiological clinical results, the current data alone is sufficient to anticipate the positive impact of heated tobacco. He questioned whether it is reasonable to allow smokers to continue to bear the health risks associated with traditional cigarettes simply because of a lack of data.

 

We welcome news tips, article submissions, interview requests, or comments on this piece.

Please contact us at info@2firsts.com, or reach out to Alan Zhao, CEO of 2Firsts, on LinkedIn


Notice

1.  This article is intended solely for professional research purposes related to industry, technology, and policy. Any references to brands or products are made purely for objective description and do not constitute any form of endorsement, recommendation, or promotion by 2Firsts.

2.  The use of nicotine-containing products — including, but not limited to, cigarettes, e-cigarettes, nicotine pouchand heated tobacco products — carries significant health risks. Users are responsible for complying with all applicable laws and regulations in their respective jurisdictions.

3.  This article is not intended to serve as the basis for any investment decisions or financial advice. 2Firsts assumes no direct or indirect liability for any inaccuracies or errors in the content.

4.  Access to this article is strictly prohibited for individuals below the legal age in their jurisdiction.

 

Copyright

 

This article is either an original work created by 2Firsts or a reproduction from third-party sources with proper attribution. All copyrights and usage rights belong to 2Firsts or the original content provider. Unauthorized reproduction, distribution, or any other form of unauthorized use by any individual or organization is strictly prohibited. Violators will be held legally accountable.

For copyright-related inquiries, please contact: info@2firsts.com

 

AI Assistance Disclaimer

 

This article may have been enhanced using AI tools to improve translation and editorial efficiency. However, due to technical limitations, inaccuracies may occur. Readers are encouraged to refer to the cited sources for the most accurate information.

We welcome any corrections or feedback. Please contact us at: info@2firsts.com

ITGA Americas Meeting Calls for Balanced Regulation as Tobacco Growers Warn of Pressure on Farms and Legal Supply Chains
ITGA Americas Meeting Calls for Balanced Regulation as Tobacco Growers Warn of Pressure on Farms and Legal Supply Chains
ITGA said tobacco grower organizations from five Americas countries called for stronger regional cooperation and balanced regulation, warning that restrictive policies could pressure farmers and legal supply chains. The article also provides data on major tobacco-producing countries in the Americas.
Special Report
Jun.02
Chinese Disposable Brands OXBAR, LYCO Challenge Vuse and JUUL: Pennsylvania’s Pending List Offers a Glimpse of the Future Legal Vape Market
Chinese Disposable Brands OXBAR, LYCO Challenge Vuse and JUUL: Pennsylvania’s Pending List Offers a Glimpse of the Future Legal Vape Market
Pennsylvania’s June 26 ENDS Pending Certifications list previews the state’s future legal vape market, placing Vuse, JUUL and Logic alongside Chinese-linked disposable brands OXBAR and LYCO. Shaped by PMTA eligibility and state rules, the list shows competition shifting from market share to market access.
Special Report
Jul.06
Reemtsma says German illegal e-cigarette seizures reached 70% of 2025 total, pouches 179%
Reemtsma says German illegal e-cigarette seizures reached 70% of 2025 total, pouches 179%
Reemtsma said its first-half 2026 black-market tracker for tobacco and nicotine products showed a continued rise in officially reported seizures in Germany, with illegal e-cigarette seizures reaching 70% of the full-year 2025 level and snus and nicotine pouch seizures reaching 179% of last year’s total.
Jul.08
North Carolina Adds $1,000 Vape Shop Tax and 21+ Age Verification Requirement
North Carolina Adds $1,000 Vape Shop Tax and 21+ Age Verification Requirement
North Carolina’s new state budget introduces additional vape retail regulations, including a $1,000 tax on vape shops and mandatory age verification requiring customers to be at least 21.
Jul.08
Former FDA Scientist Questions ZYN Review Over Pouch Material and Microplastic Risk
Former FDA Scientist Questions ZYN Review Over Pouch Material and Microplastic Risk
A former FDA toxicologist has questioned whether the agency fully assessed the material used in ZYN nicotine pouches before authorizing them for sale, raising concerns over possible microplastic exposure, according to STAT and The Examination.
Jul.16
Seita’s Julia Neumaier Says France Should Target Vape Access, Not Plain Packaging
Seita’s Julia Neumaier Says France Should Target Vape Access, Not Plain Packaging
Julia Neumaier, general manager of Seita, Imperial Brands’ French subsidiary, said France should focus vaping regulation on access control, age verification, online sales and distribution channels, rather than applying tobacco-style plain packaging to vaping products.
Jul.15