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Tobacco stocks hit by USA plan to cut nicotine levels in cigarettes

29 July 2017

R Street Harm Reduction Policy Director Carrie Wade noted that this should be considered an important first step to reorient FDA regulation of tobacco products from a process created to protect the sales and profits of the major cigarette makers to one created to reduce tobacco-related addiction, illness and death.

Major tobacco producers saw their share prices tumble on Friday after United States health officials said they would explore ways to cut nicotine levels in cigarettes.

There are obstacles to the plan, however, including figuring out to deal with the people now addicted to nicotine and finding the best ways to prevent people from smoking far more cigarettes in order to get the psychoactive effects of nicotine that they crave.

British American Tobacco's USA subsidiary, Reynolds American Inc., said it was encouraged by Mr. Gottlieb's comments on the relative risks of different tobacco products.

The goal, Mr Gottlieb added, is to "render cigarettes minimally addictive" by reducing the amount of the harmful and addictive chemical, which they say is the leading cause of preventable death in the US.

Marlboro and Parliament maker Altria shares plunged almost 10% in response to the FDA detailing a new approach that would explicitly target nicotine and addiction to cigarettes. The agency said it may also regulate "kid-appealing flavors" in e-cigarettes and cigars and wants to encourage "new products that may be less risky than cigarettes".

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The FDA's shift comes as the agency considers whether to approve new marketing claims for new heat-not-burn devices, smokeless tobacco and other products.

Neil Wilson of ETX Capital said it was "hard to overstate" what falling numbers of addicts and less frequent smoking could mean for corporate revenues.

The agency said it was adopting a harm-reduction strategy that seeks to balance regulation of existing products and encourage development of "new products that may be less risky than cigarettes".

"We think today's announcement is an important evolution in the Agency's approach to regulating tobacco products and a meaningful step forward in developing a comprehensive regulatory policy that acknowledges the continuum of risk".

Other e-cigarette regulations, such as a ban on the sale of the devices to minors, will remain in place.

Tobacco stocks hit by USA plan to cut nicotine levels in cigarettes