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The US Food and Drug Administration (FDA) could announce this week a ban on menthol cigarettes, according to CNBC sources, which would have resulted in the collapse of tobacco companies on the stock market.
This measure, which could be announced by Scott Gottlieb, commissioner of the agency, would also include electronic cigarettes to reduce the "epidemic levels of its use in adolescents," according to the revelations of senior officials of the FDA, the CNBC portal.
A senior FDA official had already said last week that the agency was considering restricting the consumption of menthol in traditional cigarettes.
This would be a step towards the elimination or strict limitation of the use of the popular cigarette aroma, which the FDA has been considering for some time.
More aggressive regulation of nicotine has been a high priority for Commissioner Scott Gottlieb.
British American Tobacco shares (BAT) sold 10.6% to 2,962 pounds on the London Stock Exchange.
Altria newspapers, maker of Marlboro, dropped 3.55% to $ 61.20.
"BAT is the name most exposed to potential risk," writes Richard Taylor, an analyst at Morgan Stanley, who estimates that menthol cigarettes from the United States account for 25% of the company's total profits.
"We are not aware of anything that has changed to suggest that the FDA is deviating from its comprehensive multi-year tobacco product flavoring regulation process, which includes menthol," BAT spokesman Simon Cleverly said. in a statement. .
If the agency says it wants to "regulate menthol cigarettes, any such proposal will have to go through the regulatory process for several years," he said.
he added.
This potential ban intensifies the FDA campaign against youth smoking. Clove-flavored cigarettes were previously withdrawn from the market and the agency is now taking a tougher approach to alternatives.
The FDA has targeted flavored tobacco products. According to studies, adolescents who smoke menthol cigarettes consume nearly twice as much per week as consumers who smoke menthol cigarettes.
All analysts do not think that a ban is likely. Owen Bennett, an analyst at Jefferies, said such an approach was unlikely and would take years to implement.
The tobacco companies would likely face a legal challenge that would delay the process, said Gerry Gallagher, an analyst at Deutsche Bank.
The decline in the number of BAT titles is proof that while the manufacturer of Lucky Strike extends to steam and hot tobacco products, its main business is smoking.
Imperial Brands lost 2.63% to 34.61 dollars. The manufacturer Winston derives about 15% of the profits from menthol brands such as Kool and Salem in the United States, according to Jefferies. The proportion is about 20% for Altria, according to the company.
Imperial Oil will continue to interact with the FDA on menthol cigarettes, but will not make any further comments until the agency makes an official update, spokesman Simon Evans said via e-mail.
Newport is BAT's largest brand of menthol and accounts for about 40% of sales in the United States, according to Duncan Fox, Bloomberg Intelligence analyst.
Tobacco companies have won an exception for menthol when a federal law banned other flavors in 2009.
BAT's shares fell by 40% this year, the biggest drop of at least two decades. They have only experienced two annual declines over the past 19 years.
With information from Bloomberg.
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