On April 19, Eastern Time, media reported that the Biden administration is considering a new policy requiring tobacco companies to reduce the nicotine content of all cigarettes sold in the United States to a level that no longer makes consumers addicted. In addition, the Biden administration is still considering whether to ban the sale of menthol cigarettes at the same time.
Menthol cigarettes are cigarettes with a menthol flavor formed by adding a small amount of menthol to cigarettes.
Many experts have pointed out that the menthol flavor helps reduce the pungent sensation of burning tobacco, making it easier for new smokers to develop the habit of smoking, and such products are more harmful among people of color. The public also called on the FDA to ban such cigarettes because they feared that such cigarettes would increase the harm to minority communities and would be more likely to induce the next generation to smoke. It is reported that the European Union and the United Kingdom banned the sale of menthol cigarettes last year, and the U.S. Food and Drug Administration (FDA) must also publicly respond to the public’s petition to ban menthol cigarettes before April 29.
However, the White House and the FDA still declined to comment on the New Deal that the Biden administration intends to introduce, but the market reacted strongly.
On April 19, Marlboro’s parent company and tobacco giant Altria (OM) dived in midday. Within five minutes of the news, the stock price went from a slight increase to a decline of more than 7%. The largest daily decline exceeded 7.7%. It closed down 6.17%. In addition, another tobacco company, Philip Morris International, also turned down, closing more than 1%.
Some analysts also believe that if the New Deal is introduced, it will reduce the addictiveness of traditional cigarettes, but it may also push some smokers to switch to alternatives, such as nicotine gum and e-cigarettes. The next day, Fogcore Technology, the parent company of RELX vape, rose 1.98%.