U.S. seeks to lower nicotine in cigarettes to non-addictive levels

Glen Mclaughlin
August 7, 2017

Cigarette makers British American Tobacco plc (LON:BATS) and Imperial Brands plc (LON:IMB) fell to the bottom of the FTSE 100 as the US Food and Drug Administration announced tightened regulation on the industry created to move smokers towards potentially less harmful e-cigarettes. If the nicotine were removed, or reduced to non-addictive or minimally addictive levels, the FDA is betting that far fewer people would end up smoking cigarettes and suffering the consequences.

"A renewed focus on nicotine can help us to achieve a world where cigarettes no longer addict future generations of our kids", said Gottlieb in a Maryland speech.

Altria Group Inc (NYSE:MO), crushed by a recent FDA plan to limit the amount of nicotine in cigarettes, caught a bearish note form a key Wall Street firm this morning.

For e-cigarettes, the agency extended the deadline by up to four years, and up to three years for cigar companies, to comply with a 2016 rule that gave the FDA oversight over the products, giving them more time on the market without regulation. Camel, a brand that is owned by Reynolds American, Inc, which has recently been acquired by British American Tobacco, will allow you to enjoy their "genuine taste" with their light cigarette.

With almost 500,000 deaths attributed to tobacco use each year in the United States, the products are responsible for almost $300 billion in lost productivity and direct healthcare costs.

For Matthew Myers, who heads Campaign for Tobacco-Free Kids, it was a good overall move but hit the e-cigarettes delay as "a serious error".

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The current requirements for smokeless tobacco and cigarettes will not be affected by the probable enforcement of the policy.

Gottlieb also held out the possibility that premium cigars would be exempted from FDA oversight, but the overall outlook for traditional tobacco products appeared grim.

Additionally, the FDA expects that manufacturers would continue to market products while the agency reviews product applications.

Although the government wants nicotine users to adapt less harmful alternatives, there is a raging debate on the potential health risks posed by e-cigarettes too.

In addition, regulations that outline the details on the information the agency expects to be included in the Modified Risk Tobacco Product (MRTP), Premarket Tobacco Applications (PMTAs), and reports to demonstrate Substantial Equivalence (SE) are meant to be released by the agency.

The FDA rolled out a second major announcement at the same time.

Other reports by MaliBehiribAe

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