The U.S. Food and Drug Administration (FDA) is reportedly set to launch a pilot program to fast-track the review of nicotine pouches from four major tobacco companies amid mounting pressure from the Trump administration.
FDA To Fast-Track Nicotine Pouch Reviews, Aiming For Dec Completion
The FDA will expedite the review of nicotine pouches from Philip Morris International (NYSE:PM), Altria (NYSE:MO), Reynolds American, a part of British American Tobacco (NYSE:BTI), and Turning Point Brands (NYSE:TPB), according to Reuters. The FDA aims to complete the review by December, a process that has historically taken several years.
The agency has already authorized the first batch of nicotine pouches, including 20 of Philip Morris’s Zyn products, in January, more than five years after the initial application. The new pilot program could potentially provide a much quicker route to legal product launches for the selected companies.
An FDA official told the publication that the agency has been under pressure from the White House and other leadership to improve the efficiency of nicotine pouch reviews. This year, tobacco companies have been lobbying for changes, including a faster and clearer FDA authorization process.
Federal Election Commission filings reveal that BAT's Reynolds American contributed $10 million to the Trump-backed super PAC, Make America Great Again Inc.
Youth Usage Concerns Remain As Tobacco Firms Pivot Focus
The U.S. is the biggest market for smoking alternatives, with nicotine pouches being the fastest-growing segment of tobacco products in the country. Although they are regarded as one of the lowest-risk alternatives to smoking, concerns remain that they may attract new users, especially among young people.
The expedited review process comes at a crucial time for tobacco companies. In July, Philip Morris International saw a dip in its stock despite a 7.1% year-over-year increase in revenue. In March, Philip Morris was reportedly considering the sale of its U.S. cigar business, which was acquired as part of its $16 billion takeover of Swedish Match AB. The potential sale reflects Philip Morris' push to shift focus toward smoke-free products.
Meanwhile, Altria Group reported a stronger second-quarter performance with adjusted earnings per share of $1.44, beating analyst consensus estimates. The accelerated FDA review could potentially boost the market performance of these companies by allowing quicker product launches.
Price Action: On Thursday, Defiance ETFs launched the Defiance Daily Target 2X Long PM ETF (NASDAQ:ZYN), a leveraged fund aiming to deliver twice the daily performance of Philip Morris International Inc. On Friday, ZYN closed 0.98% higher as per BenzingaPro.
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Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
