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Tobacco shares fall as a result of concerns about the FDA's plans

(Bloomberg) – British American Tobacco Plc and Imperial Brands Plc led a decrease in cigarette stocks amid concerns that the US Food and Drug Administration (FDA) is planning to propose strict limits on the amount of nicotine in traditional cigarettes.

BAT fell by 5.4 percent and Imperial by 7 percent to slow down part of the decline. Research shows that reducing the amount of nicotine in a cigarette to 96 percent would improve public health, said Lynn Hull, a pharmacologist at the FDA's Tobacco Products Center, on Thursday in an online presentation of a summary of recent studies. about the subject

Although the conference was preceded by a disclaimer clause that did not formally represent the FDA's position, speculation generated that some measures could be planned. The agency said in March that it is planning a nicotine reduction proposal, although analysts say it will take years to implement it.

"By making all cigarettes minimally addictive, the morbidity and mortality caused by smoking can be significantly reduced," Hull said. With an estimated 480,000 deaths per year of causes related to smoking in the US, FDA Commissioner Scott Gottlieb is working on developing a plan to change the regulation of traditional cigarettes and new smoking alternatives.

The presentation "shows that the FDA is committed to building up a body of evidence to support its nicotine reduction agenda," said Pamela Kaufman, analyst at Morgan Stanley, in a note to customers. The next step is that the agency publishes its proposal, he said.

Both BAT, creator of Lucky Strike cigarettes, and Imperial, which makes the brand Winston, have stopped some of the first decreases; the first lost 1.7 percent at 10:50 am in the morning. in London, while the second dropped 4.5 percent. Shares of Altria Group Inc. closed Thursday, 2.9 percent, after the FDA's online broadcast on that day in New York.

Original note: Tobacco stocks fall on Concern FDA plans strict new rules (1)

– With the cooperation of Lisa Pham.

Reporter in the original story: Thomas Mulier in Geneva, tmulier@bloomberg.net

Responsible for the original note: Eric Pfanner, epfanner1@bloomberg.net, John Lauerman, John J. Edwards III

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