Philip Morris expands e-cigarette deal with Altria

LONDON (Reuters) - Philip Morris International (PM.N) and its American counterpart Altria Group (MO.N) announced on Thursday an expansion of their agreement on e-cigarettes to include research and development, as the market for tobacco alternatives continues to evolve.

The companies, which split from each other in 2008, said in 2013 that Philip Morris would have the exclusive right to sell Altria's e-cigarettes outside the United States, and Altria the exclusive right to sell two of Philip Morris's "heated tobacco products" in the United States. They also said they would cooperate on scientific assessments of the products, engaging with regulators and sharing improvements in the products.

On Thursday, the companies said they were expanding that framework to include a joint research, development and technology-sharing agreement, which a Philip Morris spokeswoman said would set a framework to develop the next generation of e-cigarettes.

E-cigarettes, which heat nicotine-laced liquid into an inhalable vapour, have been growing in popularity on both sides of the Atlantic, but remain the subject of much debate due largely to a lack of long-term data about their effects on health. Still, many scientists believe they are much safer than traditional cigarettes.

Altria sells an e-cigarette called MarkTen in the United States, which Philip Morris sells in Spain under the brand name Solaris. Philip Morris also sells Marlboro HeatSticks, made from tobacco, in Italy and Japan.

Separately on Thursday, Philip Morris, the world's leading tobacco company, said it was dissolving a joint venture with Swedish Match (SWMA.ST) that was aimed at selling snus, a type of smokeless tobacco, outside Scandinavia and the United States. The companies said there was a small but growing demand for snus in those markets but that "development has ... taken longer than the parties had initially anticipated".

The companies will now pursue their own strategies, though there are transitional agreements in place whereby Swedish Match will supply snus to Philip Morris for certain markets, and Philip Morris will distribute the Swedish company's snus in Canada and Russia.

(Reporting by Martinne Geller in London; Editing by Susan Fenton)