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Notes On matting vi th -Advanced Tobacco Products Inc. USA
bald at BLTUXE R&D Centre on 17th June 1 9 8 6
Present: Mr. J.?. lay
Dr. I. Kill
Mr. A.L. Board
Mr. ?.C. Godby
Dr. R.R. Baker
Mr. D.E. Creighton
Dr. COC. Craig
Mr. T.G. Mitchell
Dr. R. Diana
Dr. T. Hirji
Summary
Potential Project
SAT started by identifying several cut-off points between
current cigarettes and FAVOR. k fundamental transition is
the aerosol: vapour interface. SAT believe that aerosol
droplets will be essential for the foreseeable future.
Furthermore, the presence of tobacco smoke in the aerosol
stream is a pre-requisite for the Immediate future.
Thus, the discussions at this meeting were to be confined to
potential smoke-related application of ATP knowledge acquired
through FAVOR development. This lies not only In
purification and handling of nicotine but is claimed
additionally to be In the aerosol area. The aim of the
meeting was to determine whether a product could be specified
for research by ATP (in conjunction with SAT) In the smoke
product area. if so, the meeting should table some ideas of
mechanism for collaboration.
The next target for the tobacco companies is very likely to
be for a low tar, conventional nicotine product. Past
experience in BAT has failed to achieve consumer acceptance
of low tar : nicotine ratio cigarettes. e.g. lose tban 10.
LTP believe they have the base know-how for opening up the
sub-10 region.
BAT warned that the question of acceptability by Authorities
of products containing significant amounts of Incn-tobacco
material I in the burning zone will have to be skillfully
managed. BAT guidance will be Important.
rough specification for a target product was established.
full flavour product such an ELK or Camel ]Filter at 14-L6
mg tar and approximately 1.2-1.4 mg nicotine will be co
selected, and scans of reducing the tar La significant steps
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will be explored: consumer acceptability will be tested by @_o
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rars of BAT/ATP interaction
Several possible arrangements were tabled.
1. BAT contracts ATP to do the reeearch project at an agreed fee.
2. As 1. but with A,T paid, additionally, a royalty an product
sales.
3. An I. but ATP receive a 'parking feel* if BAT chooses to delay
the cousercialisation of the results of the project.
4. Formation of a joint venture company that holds the technology
and which receives royalties for any &$road use of the
know-how.
only 1. was rejected - ATP have no Interest in suppling contract
research. With the possible exception of option 4., all
relationships assume exclusive rights to know-how and patents by
BAT.
The full cost of the seven researchers (and support) at ATP is
$100.000 - 200,000/nouth and clearly AT? are keen to have them
engaged on a project such an that discussed. (Since ATP have no
tobacco handling or cigarette asking/testing capability, it is
difficult to see how stare than two researchers (and support) could
be continuously engaged). BAT would wish to start the project at
low cost and schedule to increase, subject to review, as results
flow. ATP intimated that if BAT are serious, a total project cost
of $I= should be contemplated.
P.C. Godby will consult with Southampton and A.L. Heard to define:
I) specification of the desired product
II) outlines of the project
III) specification of an acceptable and point.
This would be Incorporated into Heads of Agreement/Letters of
Intent proposals which would be discussed at a future data by, BAT
and ATP. Interim tecbuical/feasiblity discussions prior to
initialling of a final docusent could proceed under
confidentiality agreements as and when necessary.
a ATP were Interested In starting immediately and proceeding to
market as soon as a perceived suitable product was obtained.
BAT could envisage a future requirement for the product, ready
for use when they judged the sarket ready. There was thus a
conflict which was partially resolved by the notion of a
.parking fee' in which BAT paid essentially a royalty for
non-use, as well as a royalty when eventually used.)
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Action
1 BAT Legal Department will draft a Reads of Agreement letter to
ATP setting out its initial views of a project with product
specification and with possible means of collaboration.
2. A.L. Beard will need to Identify a source of funds for a
project.
3. R.R. Baker will check that such a project would fLt into the
general Group R&D approach to low tar/nicotine products.
4. BATUKE R&D will identify a senior R&D person to direct the
project and links to ATP, and a project scientist to cover
detailed aspects.
A. L. Heard
Distribution:
Messrs. Z.A.A. Druell (Summary only)
C. Warren, ITL, Canada
P.C. Godby, Hillbauk
J.A.R. Kellagh*r, Millbank
C. Craig
Dr. R. Zinn* R&D, Soton
Dr. R.&. Baker
ALE/DZT
25th June 1986
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