Thursday, August 10, 2017 1:00 am
Bid to cut nicotine levels going global
Sam Chambers | Bloomberg
The U.S. Food and Drug Administration's proposal to strip cigarettes of their addictive properties has opened a new front in the international campaign to reduce smoking.
After FDA Commissioner Scott Gottlieb suggested mandating drastic cuts in nicotine levels, public health experts in New Zealand last week published an action plan recommending such reductions within five years. Canada and Finland say they're looking into regulating amounts of the drug in tobacco products, while officials in the U.K.'s Department of Health have discussed the U.S. proposal with FDA representatives, according to a person familiar with the matter.
The FDA has “massively raised the attention on reduced-nicotine cigarettes for regulators across the world,” said Clive Bates, a public health consultant. The move provides “tremendous impetus” to the concept of nicotine limits despite the policy's flaws, which include the likelihood that it would create a black market for standard cigarettes, he said.
The FDA's proactive stance could embolden authorities outside the U.S. to step up the war on nicotine, undermining tobacco companies' prospects in developing countries where they've sought growth to compensate for falling smoking rates in the wealthy world. History shows that government efforts to curb smoking, from advertising bans to restrictions on packaging, can spread quickly across borders.
Gottlieb's move wiped about $36 billion off the value of tobacco companies in a single day, initially hitting those with the biggest U.S. exposure, such as Lucky Strike owner British American Tobacco Plc and Marlboro parent Altria Group Inc., the hardest. The timing of the FDA announcement may be particularly painful for BAT, which is said to be marketing bonds in Europe after on Tuesday announcing one of 2017's biggest bond sales in the U.S., to refinance its $49.4 billion buyout of Reynolds American Inc. BAT shares fell as much as 1.2 percent in London on Wednesday.