Last Wednesday, the FDA announced that it issued over a 1,000 warning letters to U.S. retailers and manufacturers of e-cigarettes, in what the agency called “the largest coordinated enforcement effort in the FDA’s history.”
In the letters, the agency is demanding that within 60 days, these companies, namely Juul, Vuse, MarkTen XL, blu e-cigs and Logic, present proof that they are able to keep the nicotine-containing products out of the hands of minors. Should they fail to do so, the FDA may ban candy-like flavors, such as bubble gum and crème brûlée, that may be particularly appealing to this age group.
A loss for public health and win for big tobacco?
Given the popularity of e-cigarettes, tobacco investors had grown increasingly concerned that as successful e-cigarette companies such as Juul continue expanding, the major cigarette producing companies were doomed. However, the FDA’s actions have rightly brought newfound hope to such investors.
More FDA’s actions that benefit only Big Tobacco
Wells Fargo analyst Bonnie Herzog explained that if the ban were to happen, Altria Group is mostly likely to benefit. “Given the market’s overarching concerns about Juul’s impact on cigarettes, especially Marlboro, we think a potential ’ban’ on Juul would be positive for MO,” Herzog wrote.