The U.S. Food and Drug Administration has announced a plan to consider lowering the amount of nicotine in cigarettes to curb addiction—a move that’s causing Big Tobacco stocks to plunge in early trading Friday.
In a report issued Friday morning, the FDA said it plans “to begin a public dialogue about lowering nicotine levels in combustible cigarettes to non-addictive levels.”
“Because almost 90% of adult smokers started smoking before the age of 18 and nearly 2,500 youth smoke their first cigarette every day in the U.S., lowering nicotine levels could decrease the likelihood that future generations become addicted to cigarettes and allow more currently addicted smokers to quit,” the agency wrote.
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Tobacco use is tied to 480,000 deaths per year in the United States. Health care and lost productivity costs come in at nearly $300 billion annually, according to the FDA.
“The overwhelming amount of death and disease attributable to tobacco is caused by addiction to cigarettes—the only legal consumer product that, when used as intended, will kill half of all long-term users,” said FDA Commissioner Scott Gottlieb. “Unless we change course, 5.6 million young people alive today will die prematurely later in life from tobacco use.”
Shortly before 11 a.m., shares in Altria Group were down nearly 12%, while British American Tobacco were off 9% and Philip Morris was down 3.5%.
Electronic cigarette companies caught a break in the announcement, though. The FDA said it would delay, by several years, a requirement that makers of e-cigs and cigars get agency approval for products marketed after February 2007.