Shares of Marlboro producer Altria Group Inc. plunged following a report that the U.S. government is considering a rule that would lower the nicotine content of cigarettes.
The Biden administration is mulling a requirement that nicotine be lowered to levels that aren’t addictive, the Wall Street Journal reported, citing people familiar with the matter. The Food and Drug Administration could also move to ban menthol cigarettes, the Journal reported.
Shares of Altria, which sells the Marlboro brand in the U.S., slumped 7% at 3:25 p.m. in New York trading. Philip Morris International Inc., which sells the brand internationally, also declined. Stock of 22nd Century Group Inc., which sells cigarettes with very low nicotine levels, jumped 18%.
The FDA declined to comment on the report. Altria didn’t immediately respond to an email request for comment
The FDA has been expected to state its position on whether it would still allow menthol cigarettes by April 29, under a deadline imposed by a lawsuit. The case, brought by the African American Tobacco Control Leadership Council, had sued the government agency saying it had taken an unreasonably long time to respond to a citizen’s petition filed years ago that sought to prohibit menthol as a flavor in cigarettes.
There has also been anticipation that the agency would make a decision about nicotine levels in cigarettes. The agency had declared in 2018 that it intended to do so, but Altria had said it wasn’t clear whether that was “technically achievable” or would lead to reduced smoking. Since then, 22nd Century Group, based in Williamsville, New York, has come out with reduced nicotine cigarettes.