Hmm? Spike heard the coughing, and even comprehended the coughing, and what was CAUSING the coughing, but he wasn't exactly one to consider other people too much. Especially when it came to his smoking. Smoking was a necessity. Hence his not even making an effort to point anything any other way, just kept puffing away.

"Uhh, 'mister', kinda formal, ain't it? I'm good with Spike."