Michael Bloomberg's charitable foundation will commit an additional $220 million over the next four years to fighting tobacco use globally, including funding for legal challenges against the tobacco industry by countries such as Uruguay.
The New York City mayor was set to announce the new funding for Bloomberg Philanthropies on Thursday at the 15th World Conference on Tobacco or Health in Singapore. His charity will monitor the tobacco industry's strategies and offer legal support to counter its pushback against anti-smoking campaigns.
Calling tobacco "a scourge all over the world" and accusing cigarette makers of "nefarious activities," Bloomberg said at a news conference on Friday that his foundation will focus on low and moderate-income countries where nearly 80 percent of smokers live, like Russia, China, India, Indonesia and Bangladesh.
That marks a departure from Bloomberg's efforts since 2007, which have been funded with $375 million from the billionaire mayor's pocket. Until now, his anti-smoking campaign has focused on "what's worked here" in New York City, said Dr. Kelly Henning, director of the charity's public health programs.
That included pressing local and national governments to raise cigarette taxes; persuading the entertainment industry to
deglamorize smoking by not filming movie stars smoking; making nicotine patches widely available; and, lobbying for laws that ban tobacco advertising, sponsorship and smoking in public.
Such strategies have worked. In New York City, the adult smoking rate has reached an all-time low of 14%, the Health Department announced last September. That is 35% below the rate in 2002, when the department began its anti-smoking efforts.
By comparison, the national smoking rate is 19.3%, according to the Centers for Disease Control and Prevention.
FOLLOWING NYC EXAMPLE
The New York City example is starting to be adopted overseas. Earlier this month, India increased its cigarette tax.
"We've been doing tax advocacy in India for the last year and have now seen 12 states raise their state-level value-added tax on cigarettes," said Henning. "This increase is at national level. We consider it a small step forward."
Bloomberg Philanthropies' campaign has also led to laws banning smoking in public places, including workplaces and restaurants, in Brazil, Turkey and Pakistan, and cities such as Jakarta, Mexico City and Harbin City in China.
Working with ministries of health and non-governmental organizations, the charity has helped win the passage of laws in 11 countries mandating graphic images on cigarette packs. In the United States, the government and tobacco industry are battling in court over whether a similar law is constitutional.
But the global fight is growing fiercer as new regulations threaten industry profits overseas.
To counter a decline in smoking in the United States, cigarette makers have relied on higher prices, cost cuts and growth in smokeless tobacco to keep profits rising.
They have also targeted overseas markets, especially in China, Indonesia, and Russia, where a growing middle class can pay up for branded products. Altria Group's 2008 spinoff of Philip Morris International gave investors a choice between a sustainable cash return in the United States or growth prospects internationally.
According to the Tobacco Atlas, released Wednesday by the American Cancer Society and the World Lung Foundation at the tobacco congress, the tobacco industry reaped profits of $35 billion in 2010, "equivalent to $6,000 for each death caused by tobacco," the groups said in a statement.
PHILIP MORRIS VS URUGUAY
As anti-tobacco policies and laws are extended in the world - they currently cover 2.2 billion people - they threaten cigarette makers' profits and the industry is fighting back.
"The industry does its work in the dark of night to undermine legislation and keep marketing to kids and all the other nefarious activities they do," Bloomberg said.
Bloomberg Philanthropies is working against that trend by helping Uruguay, for example, battle Philip Morris.
In 2009 the South American country adopted a law requiring that warning labels cover 80% (the most in the world) of the surface of cigarette packs, and that each brand have only one variant (no "lights," menthols or other brand extensions), among other restrictions.
In response, Philip Morris International and three affiliates filed an official complaint against Uruguay with the International Center for Settlement of Investment Disputes, part of the World Bank, alleging that the restrictions harmed the tobacco firms' business operations and violated a bilateral investment treaty between Uruguay and Switzerland, where two of the affiliates are based.
"We have supported and will continue to support effective and sensible tobacco regulations," Philip Morris International said in a statement to Reuters. "The Uruguayan regulations we are challenging are neither. For example, as a result of the regulations we had to stop selling seven of our 12 brand variations in Uruguay. In the case of Marlboro, the regulation meant that the Gold, Blue and Green variations representing about 40% of Marlboro sales had to be taken off the market. ... We had no option but to seek legal recourse."
Bloomberg is underwriting legal assistance for Uruguay and helping it hire expert consultants to assist with filings, said Henning. "If industry wins this one, other countries will be terrified of adopting anti-tobacco measures," she said.