Dow Jones component and drugstore chain Walgreens Boots Alliance Inc WBA said Tuesday it will only sell tobacco products to people over the age of 21 beginning Sept. 1.
What Happened
The legal age for purchasing tobacco products in the U.S. is 18, but Walgreens is setting its own policy in reaction to the FDA's specific demands for the retailer to do more in curbing underage smoking. The FDA said in early February that Walgreens is the biggest violator among pharmacy chains who sell tobacco products.
Walgreens said in a press release that its new policy of restricting tobacco sales to customers over 21 can be helpful in reducing tobacco use among teens and young adults. Other initiatives Walgreens already introduced include a "Card All" policy across all locations. As of late 2018, each transaction that includes a tobacco product will require age verification.
The FDA sent similar warning letters to a handful of retailers and department stores in mid-April.
Why It's Important
Walgreens said studies have shown that cities that do not sell tobacco products to anyone under 21 realize a "sharp decline" in tobacco use among the 18-20 demographic.
Despite what appears to be a negative catalyst for the tobacco sector, shares of multiple companies were trading higher at the time of publication Tuesday:
Altria Group Inc MO: 0.6-percent higher.
British American Tobacco PLC BTI: up 0.73 percent.
Philip Morris International Inc. PM: up 0.49 percent.
What's Next
Senate Majority Leader Mitch McConnell said last Thursday that he will introduce legislation to lift the federal legal age to buy tobacco products to 21.
Related Links:
McConnell Proposes Raising Smoking Age To 21, Tobacco Stocks Flicker
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