The US FDA is moving forward with plans to mandate lower nicotine levels in cigarettes.

“The plan, which is touted as a way to reduce the ability of cigarettes to hook casual users, cleared a regulatory review last week by the Food and Drug Administration,” as noted by Fox News. “It’s unclear if the FDA will issue a proposed rule outlining the looming regulation before Biden leaves office on Jan. 20.”

“This would be a historic action by the FDA that has the potential to have an enormous impact on public health,” said Dr. Rose Marie Robertson, science and medical officer of the American Heart Association, as quoted by NBC News. 

In addition, A 2018 study from the US FDA estimated that a nicotine cap would result in 16 million fewer people becoming addicted to smoking by 2060. 

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With that, investors should keep an eye on stocks, like 22nd Century Group (XXII), which said it will support the U.S. FDA’s proposed tobacco product standard to mandate reduced nicotine content in cigarettes, which is indicated to have cleared review by the U.S. Office of Management and Budget.

Helping, the company’s VLN branded low nicotine cigarettes align with this initiative, being the first and only FDA-authorized reduced nicotine content cigarettes in the market.

British American Tobacco (BTI) could also benefit, as it pursues smoking alternatives.

Helping, BTI just announced the repurchase of 89,920 of its ordinary shares, as part of its ongoing buyback program. The company is also making substantial progress to become a smokeless business by 2035. It also sees “progressive improvement” in 2025 with stronger profitable growth in the mid-single-digit range by 2026. Even better, the BTI stock yield is 8.34%, which is probably one of the biggest reasons to buy and hold the stock. 

It’s just something to consider if you’re looking for new trading opportunities.

Sincerely,

Ian Cooper