The FDA has sent warning letters to as many as 1,300 retailers who deal in five popular e-cig brands
Meanwhile, shares of the leading tobacco companies witnessed frenetic buying activity following the news Wednesday, sending the prices sharply higher.
The regulators are particularly concerned about the health hazards of flavored e-cigs. They have directed manufacturers of the leading brands, which account for the lion’s share of total e-cig sales, to come up with plans within 60 days to stop the ‘epidemic’ of vaping among teenagers.
The FDA is considering a revision of its compliance policy, with more stringent norms for approving the marketing applications of firms that fail to act upon the directive. It also plans to impose a ban on the production and sale of flavored nicotine liquid used in vaping devices, and recommend a review of the products.
“The disturbing and accelerating trajectory of use we’re seeing in youth, and the resulting path to addiction, must end. The FDA cannot tolerate a whole generation of young people becoming addicted to nicotine as a tradeoff for enabling adults to access these products,” said FDA Commissioner Scott Gottlieb.
Still struggling to recover from the huge loss suffered in Mid-April, Philip Morris (PM) shares gained about 4% Wednesday, marking the biggest intraday gain in three years. Altria’s (MO) stock also got a strong boost after the FDA announcement and gained about 7%. The news evoked a similar response among the investors of British American Tobacco (BTI), resulting in a 6% rise in its stock price.