* BAT to transfer Voke rights back to Kind Consumer
* Kind to search for new partners
* BAT to concentrate efforts on vaping, tobacco-heating (Adds market data, background, byline)
By Martinne Geller
LONDON, Jan 5 (Reuters) - British American Tobacco (BAT) has quit plans to market a nicotine inhaler called Voketo focus on consumer items like e-cigarettes rather than healthproducts.
The move reins in BAT's earlier, very diversified approachto cigarette alternatives, which are being pursued by all biglisted tobacco companies including Philip Morris International and Japan Tobacco International as a growinghealth consciousness reduces smoking rates.
BAT's decision to narrow its focus comes after manufacturingissues delayed the launch of Voke, which was the first productapproved by Britain's drug regulator to be prescribed as amedical aid to quit smoking. It will now be marketed by BAT'spartner Kind Consumer, which originally developed the product,the two companies said on Thursday.
BAT, which is in talks on a $47 billion takeover of U.S.peer Reynolds American, said its strategy onnext-generation products would now focus on its Vype e-cigaretteand its glo tobacco-heating product, which both create aninhalable vapour that many scientists say is less dangerous thansmoking.
E-cigarettes have ballooned into an $8 billion market,according to Euromonitor International, more than three timesthat of nicotine-replacement therapies such as gum and patchessold by pharmaceutical companies including GlaxoSmithKline.
Voke, like e-cigarettes, mimics the look and feel oftraditional cigarettes but uses a pressurised canister withaerosol that is breath-activated, rather than using a battery toheat nicotine liquid.
BAT's move highlights how far e-cigarettes have come inrecent years, in both sales and design.
"The first generations of these products have set a highwater mark that all subsequent products must now beat," saidMorningstar analyst Philip Gorham.
BAT, the world's second-biggest international tobaccocompany, said it would transfer manufacturing, intellectualproperty and know-how assets to Kind Consumer, in return fordeferred, contingent payments. Financial details were notdisclosed.
Kind said in a joint statement with BAT that it would seek anew global partner, or possibly several regional partners, toaccelerate distribution of the inhaler this year.
Consort Medical, which was to supply the inhaler,said on Tuesday that BAT had ended its supply agreement afterthe product failed to launch in 2016, but said it remained indiscussions with BAT and Kind about the future of the product. (Reporting by Martinne Geller in London; editing by Jason Neelyand Susan Fenton)
