FDA aims to cut nicotine in cigarettes, ease e-cigarette rules

Paterniano Del Favero
Luglio 28, 2017

British American Tobacco shares, trading close to all-time highs, fell as much as 11 percent and were on track for their biggest one-day loss in almost 18 years.

The US Food and Drug Administration said that it aims to reduce nicotine levels in cigarettes but also encourage smokers to shift towards e-cigarettes as part of a major new regulatory programme. Other tobacco companies, including British American Tobacco (BTI) and Universal Corp (UVV) were also down.

"Tobacco use remains the leading cause of preventable disease and death in the United States, causing more than 480,000 deaths every single year", the FDA said in announcing the plan.

Shares of the Dunhill and Lucky Strike maker slumped by nearly 7 per cent, losing 362p to £49.60, while Imperial Brands dropped 3.7 per cent to £33.98 after the FDA said it was pursuing a "comprehensive regulatory plan" to lower nicotine in cigarettes to non-addictive levels. "Unless we change course, 5.6 million young people alive today will die prematurely later in life from tobacco use". The FDA said it also would examine the role menthol and other flavors play in tobacco use and encourage the "development of innovative tobacco products that may be less unsafe than cigarettes".

The agency said it would issue guidance on its new policies "shortly".

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