ITC: ITC’s alignment with global healthcare trend needs to be deepened

ET Intelligence Group: S shares gained 1.5% on Thursday thanks to the company conducting clinical trials to develop a nasal spray for the prevention of Covid-19. He plans to market the nasal spray under the Savlon brand once he gets all the required approvals. Investors applauded the move even though it is still an early stage for the company.

That a business conglomerate facing the heat of cigarette sales aligns with the goal of protecting health may seem counterintuitive, but India’s largest cigarette company regularly aligns itself with the health sector as as a strategic initiative in line with the trend set by the global tobacco industry. .

In September, tobacco major Philip Morris bought a stake in an asthma inhaler company, a move that was criticized by campaign groups. Globally, cigarette companies are working on reduced risk products that could be alternatives to cigarettes. ITC’s foreign shareholder, British American Tobacco (BAT), is investing more than £ 1 billion in new product development over the next two years.
ITC has been taking incremental steps to align with the health sector for a few years now. In 2017, it requested shareholder approval for the modification of the subject matter clause of its articles of association to include “health care”. The objective was to enter the field of health in India through the establishment of multispecialty hospitals and other health services. The following year, the company hired Dr Chandy Abraham of Narayana Health as the managing director of its healthcare business.

ITC had acquired the antiseptic disinfectant brand Savlon in 2015 from Johnson & Johnson. The pandemic was an opportunity to step up the offer of products related to health and hygiene under the Savlon brand.

In July 2020, the company incorporated a subsidiary to manufacture and export nicotine and nicotine derivative products in an effort to meet the growing demand for nicotine-based oral and vaping products in the US and European markets. The move will also help the company assess consumption trends for emerging products that serve as alternatives to cigarettes.

Promoting healthcare is also one of the priority areas of ITC’s corporate social responsibility programs. Last month, ITC’s Fiama body wash brand, in collaboration with the Minds Foundation, launched its virtual clinic for mental wellness. The clinic serves as an option to gain affordable access to mental health therapy.

As investor pressure on environmental, social and governance issues increases and new generation products emerge, ITC will need to take more concrete steps to develop less harmful alternatives to cigarettes and rely on its health and well-being offers to offset the negative impact on public health caused by its cigarette activity.

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