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Cigarette Taxes Apparently Work

Posted Jan 04 2011 8:12am
Not to be negative about public health educational campaigns, which I believe are important, but the two major factors that have led to the decline in US smokers over the past decade are most attributable two two things: smoking bans and taxes on cigarettes. When it becomes difficult to smoke in public places and expensive do to so anywhere, people are more motivated to quit.
An article in the NY Times today caught my attention: In Japan, Pfizer Is Short of Drug to Help Smokers . The focus of the article regards how Pfizer was a little unprepared for the excessive demand of the smoking cessation drug Chantix (called Champix in Japan and elsewhere) when the Japanese government imposed a cigarette tax.

Being in the business section, the focus is on sales and Pfizer's handling of the situation. However, I am much more interested in the impact of the Japanese cigarette tax on behavior. Japan has a much high smoking rate than in the US. In 2009, about 40% of Japanese men smoked, compared to about 24% of US males. The Japanese tax started in October of this year. Prior to this, the rate of smokers in Japan decreased by about 2%. The tax increased the cost of a pack of cigarettes from about $3.60 US dollars to $4.80. Prior to the tax, ad campaigns sponsored by Pfizer, led to sales of Chantix to 70,000 patients a month in August, which more than doubled to 170,000 patients in September (just before the tax) and continued to grow in October (the NY times article talks about how Pfizer had to suspend prescriptions to new patients because they couldn't make enough Chantix fast enough to keep pace with demand).

The bottom line is that cigarette taxes have been effective in the US, and seem to quite effective in Japan based on excess demand for Chantix and a significant drop in Japanese smokers prior to the tax. With our economy still not in the best shape, health care costs escalating, and respiratory illness now rising to the 3rd leading cause of death in the US, we should consider increasing cigarette taxes even more.
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