Published: Fri, September 14, 2018
Health Care | By Cedric Leonard

Tobacco Stocks Jump After FDA Threatens E-Cig Crackdown

Tobacco Stocks Jump After FDA Threatens E-Cig Crackdown

"I have grown increasingly concerned around what we see as rising youth use in these products, and I'm disappointed in the actions the companies have taken to try to address this", Gottlieb said at a press briefing.

"Unfortunately, I now have good reason to believe that it's reached nothing short of an epidemic proportion of growth", FDA Commissioner Scott Gottleib said in a briefing. "E-cigs have become an nearly ubiquitous - and risky - trend among teens", added Gottlieb. "We can not allow a whole new generation to become addicted to nicotine".

Juul and four other manufacturers, which Gottlieb said control 97% of the market, are now required to provide plans to mitigate youth sales within 60 days or face potential criminal or civil action.

"The agency is asking each company to submit to FDA within 60 days plans describing how they will address the widespread youth access and use of their products", the FDA said in a release.

The crackdown marked the "largest coordinated enforcement effort in the FDA's history", the agency said in a statement, warning of even harsher action to come. Of the 3.6 million middle and high school students who said in 2017 they were tobacco product users, 2.1 million used e-cigarettes, Bloomberg reports, citing CDC stats.

Then a year ago, a few months after being sworn in as commissioner, Gottlieb announced a new comprehensive tobacco framework. We must factor in whether these products get kids addicted to nicotine.

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The Vapor Technology Association, which says it represents over 600 vaping manufacturers and distributors, also supports limiting teen access, but added that the new actions by the FDA ventured "into unsafe territory" by not being in the best interest of public health. Regulators are considering restricting e-cigarette manufacturers from selling flavored nicotine liquid or forcing the products to undergo an agency review, as reported by CNBC.

A Juul spokesperson, Victoria Davis, argued in a statement to Reuters that "appropriate flavors play an important role in helping adult smokers switch".

The American Medical Association's Dr. Barbara McAneny also said the FDA could do much more, pledging that the association would "continue to advocate for more stringent policies". Lisa Murkowski also asked the FDA to end delays. "Hindsight, and the data now available to us, reveal these trends".

The FDA says it has issued "more than 1,300 warning letters and fines to retailers" as a result of "a large-scale, undercover nationwide blitz to crack down on the sale of e-cigarettes to minors". "This could mean requiring these brands to remove some or all of their flavored products that may be contributing to the rise in youth use from the market until they receive premarket authorization and otherwise meet all of their obligations under the law".

Investors in Juul's competitors appeared to welcome the FDA announcement. In 2016, the agency "deemed" that products such as e-cigarettes also were under its jurisdiction and told companies to file applications to market their products by August 2018. Since a year ago, FDA commissioner Scott Gottlieb and other federal officials have discussed e-cigarettes as a potential tool to ween adult smokers off cigarettes, although that benefit hasn't been proven.

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