Market Overview

Walmart Raises Tobacco Purchase Age To 21, Phases Out Fruit-Flavored E-Cigarettes

Share:
Walmart Raises Tobacco Purchase Age To 21, Phases Out Fruit-Flavored E-Cigarettes

Walmart Inc (NYSE: WMT) said Wednesday that it's raising the purchase age for tobacco products at its U.S. stores to 21 beginning July 1. The retailer's stock and Big Tobacco stocks were trading down Wednesday afternoon, although not drastically. 

What Happened

The move, which John Scudder, Walmart's chief ethics and compliance officer in the U.S., detailed in a letter to Acting FDA Commissioner Norman Sharpless, comes after the federal agency has increased pressure on tobacco retailers to reduce sales to teens and minors

Walmart and its warehouse club subsidiary Sam's Club are also discontinuing the sale of fruit- and dessert-flavored electronic nicotine delivery systems, Scudder said.

Why It's Important

U.S. Senate Majority Leader Mitch McConnell said in April that he would introduce legislation to raise the federal age to purchase tobacco products from 18 to 21. 

Walmart was one of the retailers that received an April 5 letter from the FDA criticizing tobacco sales to minors and stating that e-cigarettes and vaping products have resulted in an "epidemic number" of minor tobacco users. 

In Wednesday's letter, Scudder detailed Walmart's tobacco control programs. 

Since 2010, the FDA has conducted about 12,800 retailer compliance checks at Walmart and Sam's Club stories, the executive said; Walmart and Sam's Club passed 93 percent and 99 percent of those checks, respectively, he said. 

"While we are not satisfied with falling short of our companywide goal of 100 percent compliance, those compliance rates nonetheless are significantly higher than the rates referenced in [former FDA Commissioner Scott Gottlieb's] April 5 letter — and, in our view, more fairly and accurately portray our performance," Scudder said. 

What's Next

Philip Morris International Inc (NYSE: PM) shares were down 0.45 percent at the time of publication Wednesday; Altria Group Inc (NYSE: MO) shares were down 1.25 percent; British American Tobacco PLC (NYSE: BTI) shares were down 0.8 percent. 

Walmart shares were down 0.29 percent. 

Related Links: 

Walgreens Lifts Tobacco Age Limit To 21, Cigarette Stocks Mostly Unaffected

Bank of America Raises Altria Price Target Despite FDA Risk 

Posted-In: E-Cigarettes retail tobacco VapingNews FDA Best of Benzinga

 

Related Articles (BTI + MO)

View Comments and Join the Discussion!
Don't Miss Any Updates!
News Directly in Your Inbox
Subscribe to:
Benzinga Premarket Activity
Get pre-market outlook, mid-day update and after-market roundup emails in your inbox.
Market in 5 Minutes
Everything you need to know about the market - quick & easy.
Daily Analyst Rating
A summary of each day’s top rating changes from sell-side analysts on the street.
Fintech Focus
A daily collection of all things fintech, interesting developments and market updates.
Thank You

Thank you for subscribing! If you have any questions feel free to call us at 1-877-440-ZING or email us at vipaccounts@benzinga.com