Skip to main content
The Globe and Mail
Support Quality Journalism
The Globe and Mail
First Access to Latest
Investment News
Collection of curated
e-books and guides
Inform your decisions via
Globe Investor Tools
Just$1.99
per week
for first 24 weeks

Enjoy unlimited digital access
Enjoy Unlimited Digital Access
Get full access to globeandmail.com
Just $1.99 per week for the first 24 weeks
Just $1.99 per week for the first 24 weeks
var select={root:".js-sub-pencil",control:".js-sub-pencil-control",open:"o-sub-pencil--open",closed:"o-sub-pencil--closed"},dom={},allowExpand=!0;function pencilInit(o){var e=arguments.length>1&&void 0!==arguments[1]&&arguments[1];select.root=o,dom.root=document.querySelector(select.root),dom.root&&(dom.control=document.querySelector(select.control),dom.control.addEventListener("click",onToggleClicked),setPanelState(e),window.addEventListener("scroll",onWindowScroll),dom.root.removeAttribute("hidden"))}function isPanelOpen(){return dom.root.classList.contains(select.open)}function setPanelState(o){dom.root.classList[o?"add":"remove"](select.open),dom.root.classList[o?"remove":"add"](select.closed),dom.control.setAttribute("aria-expanded",o)}function onToggleClicked(){var l=!isPanelOpen();setPanelState(l)}function onWindowScroll(){window.requestAnimationFrame(function() {var l=isPanelOpen(),n=0===(document.body.scrollTop||document.documentElement.scrollTop);n||l||!allowExpand?n&&l&&(allowExpand=!0,setPanelState(!1)):(allowExpand=!1,setPanelState(!0))});}pencilInit(".js-sub-pencil",!1); // via darwin-bg var slideIndex = 0; carousel(); function carousel() { var i; var x = document.getElementsByClassName("subs_valueprop"); for (i = 0; i < x.length; i++) { x[i].style.display = "none"; } slideIndex++; if (slideIndex> x.length) { slideIndex = 1; } x[slideIndex - 1].style.display = "block"; setTimeout(carousel, 2500); }

A man uses a vaping device on Sept. 19, 2019. Fears of an outright ban led BAT and Imperial to lower their growth forecasts for their U.S. vaping businesses last year.

Adnan Abidi/Reuters

Shares in British American Tobacco and Imperial Brands Plc rose on Friday after the U.S. health regulator exempted menthol and tobacco from a list of popular e-cigarette flavours that it has banned under new guidelines.

The U.S. Food and Drug Administration on Thursday said e-cigarette makers will be banned from selling pod-based e-cigarette flavours, including fruit, dessert and mint, in the United States from February.

The ban was less stringent than one U.S. President Donald Trump had proposed in September, when he threatened to remove all flavours, including menthol, from all types of e-cigarettes to curb a teenage vaping epidemic.

Story continues below advertisement

BAT shares rose as much as 2.5 per cent and were the biggest gainers in the FTSE 100 index where many shares were hit by heightened tensions in the Middle East.

Imperial Brands was also among the handful of gainers, with its shares up 1.4 per cent.

Fears of an outright ban led BAT and Imperial to lower their growth forecasts for their U.S. vaping businesses last year.

“Following a significant period of disruption and uncertainty, this regulatory clarity is a welcome step toward returning the U.S. vapour market to stability,” BAT, the maker of Lucky Strike, Dunhill and Vuse e-cigarettes, said on Friday.

The new FDA guidelines would also allow tobacco makers to bring back some of the banned flavours if their marketing applications passed a substantive review by the FDA.

This removed some ambiguity related to the future of the exempted products, Simon Evans, spokesman for Imperial Brands said.

“In addition to exempting menthol, the FDA guidance is clear that flavoured products will return to the market once they have been approved through the Premarket Tobacco Product Application (PMTA) process,” he said.

Story continues below advertisement

Brokerage Jefferies said that while vaping sales would take a near-term hit from the new rules, the overall financial impact for BAT and Imperial would be minimal as most users would either switch to menthol or tobacco, or even to higher-margin traditional tobacco products.

“We are actually bullish on implications of this final guidance,” Jefferies said.

BAT submitted a marketing application for its Vuse Solo e-cigarette to the FDA in November, while Imperial said it would submit its applications for its Blu e-cigarettes before May.

Your time is valuable. Have the Top Business Headlines newsletter conveniently delivered to your inbox in the morning or evening. Sign up today.

Follow related topics

Report an error
Tickers mentioned in this story
Due to technical reasons, we have temporarily removed commenting from our articles. We hope to have this fixed soon. Thank you for your patience. If you are looking to give feedback on our new site, please send it along to feedback@globeandmail.com. If you want to write a letter to the editor, please forward to letters@globeandmail.com.

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff. Non-subscribers can read and sort comments but will not be able to engage with them in any way. Click here to subscribe.

If you would like to write a letter to the editor, please forward it to letters@globeandmail.com. Readers can also interact with The Globe on Facebook and Twitter .

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff. Non-subscribers can read and sort comments but will not be able to engage with them in any way. Click here to subscribe.

If you would like to write a letter to the editor, please forward it to letters@globeandmail.com. Readers can also interact with The Globe on Facebook and Twitter .

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff.

We aim to create a safe and valuable space for discussion and debate. That means:

  • Treat others as you wish to be treated
  • Criticize ideas, not people
  • Stay on topic
  • Avoid the use of toxic and offensive language
  • Flag bad behaviour

Comments that violate our community guidelines will be removed.

Read our community guidelines here

Discussion loading ...

To view this site properly, enable cookies in your browser. Read our privacy policy to learn more.
How to enable cookies