IQOS is designed to heat tobacco but not burn it, and comes in a sleek package that would not look out of place in an Apple store. Most of the harmful chemicals in tobacco are released when tobacco is burned, forming the basis of Philip Morris's claim of a less-risky product.
If cleared, iQOS would become the first product to carry a modified-risk claim and could advance the Food and Drug Administration's proposed new approach to reduce the dangers of smoking by creating a market for less harmful products than cigarettes.
On Monday, the FDA said its review of iQOS found that the product contains lower levels of toxic chemicals than cigarettes, but could not say whether that translates into lower rates of tobacco-related disease.
Medical and other expert advisors to the FDA will discuss the product on Wednesday and Thursday and recommend whether it should be cleared as a so-called "modified risk" tobacco product. The FDA is not obliged to follow the recommendations of its outside advisers but typically does.
Tobacco experts said the FDA documents do not show a clear point of view by the agency reviewers.
"It's a complex document with lots of data and findings that could be used by proponents on either side," said Matthew Myers, president of the Campaign for Tobacco Free Kids.
Philip Morris's shares fell 0.1 percent to $108.80 in afternoon trading in New York.
Last month, a Reuters investigation described irregularities in the clinical trials that supported Philip Morris's iQOS application to the FDA. https://www.reuters.com/investigates/special-report/tobacco-iqos-science/ http://www.reuters.com/investigates/section/pmi
(For a graphic on market share of novel tobacco and vapor products, see: (http://tmsnrt.rs/2DQ7cIH)
For decades, U.S. health agencies have worked to help Americans quit cigarettes to avoid the risks of lung cancer and other disease. National smoking rates have declined to near historic lows of around 15 percent.
But in July, newly appointed FDA Commissioner Scott Gottlieb proposed reducing nicotine levels in cigarettes to "non-addictive" levels while increasing development of lower-risk alternatives. The policy assumes that some percentage of the population will be unable or unwilling to give up nicotine.
To make the new strategy succeed, the agency needs a stable of vetted, reduced-risk alternatives to cigarettes. Philip Morris is one of the few companies that can finance such a long development process, spending close to $3 billion on reduced-risk products.
"If this application fails, it will be clear that this is an expensive, wasteful, regulatory dead end," said Clive Bates, a tobacco expert who runs the consulting firm Counterfactual and advocates for alternative nicotine products.
Bates and others argue that if Philip Morris cannot win FDA clearance for a modified-risk product, no one will be able to.
Other companies have submitted modified-risk products for FDA review. 22nd Century Group Inc, which genetically engineers tobacco plants to have lower nicotine levels, seeks clearance for its "Brand A" very low nicotine cigarettes.
R.J. Reynolds Tobacco Co, owned by British American Tobacco Plc, seeks clearance for six snus products - a moist smokeless tobacco pouch placed under the lip - under the Camel brand.
IQOS is already used by nearly 4 million people in 30 markets outside the United States.
It consists of a small pen-like holder containing a heated tobacco stick, and a charger. It looks similar to an e-cigarette, but uses real tobacco rather than nicotine-laced liquid.
Philip Morris says that iQOS contains up to 95 percent fewer harmful or potentially harmful chemicals than the cigarette smoke produced from burning tobacco. If approved, the product would be marketed by U.S. partner Altria Group Inc.
The hurdles for success are high.
To sell a new tobacco product, a company must demonstrate that it significantly reduces the risk of disease and does not encourage more smoking or delay quitting.
To date, the FDA has determined that only eight products meet that standard, all of them snus smokeless tobacco pouches made by Swedish Match AB. The agency has granted no company the right to specifically claim that their product is less risky than cigarettes.
Tobacco control activists say companies like Philip Morris cannot be trusted to make reduced-risk claims. They point to the industry's previous promotion of "light" and "low-tar" cigarettes as safer alternatives despite evidence showing they were not.
Others argue that things have changed. Since 2009, the tobacco industry has had to answer to the FDA under federal law. New technology, including e-cigarettes and heat-not-burn products, may help smokers quit or shift those who cannot quit onto a less harmful substitute, they say.
"Many of my friends in the tobacco control movement are still fighting the tobacco wars of the 1980s," said Scott Ballin, an independent health policy consultant and long-time anti-tobacco activist. "We are beyond that now."
The FDA's Gottlieb favors an approach to treating addiction that makes available less harmful versions of addictive substances, including nicotine and opioids. These products, he argues, can help minimize damage to those unable to quit.
Mitch Zeller, head of the FDA's tobacco division, refers frequently to a "continuum of risk" for nicotine products, with nicotine gums and lozenges on one end and cigarettes on the other. The FDA would like to shift smokers unable to quit nicotine from high-risk to low-risk products.
"What we have developed is an offering on the continuum of risk," said Ruth Dempsey, Philip Morris' director of scientific engagement. "We believe it is better than cigarettes."
(Reporting by Reuters staff; Editing by Michele Gershberg and Matthew Lewis)