It is "not a needle-moving chapter," Modi said, "but those could come soon."
The draft concludes that: a) menthol cigarette use is high [image-nocss] among minority youth; b) use of menthol cigarettes is rising among young adults; and c) menthol use is more prevalent among unemployed and lower-income smokers. (Click here to read a draft of Chapter 4).
Kara Henschel, a spokesperson for the FDA, emphasized for CSP Daily News that only draft chapters of the report have been shared. She suggested that readers also review the "Menthol Report: What to Expect" page for details on the report release process (click here).Modi said given the studies the studies that have been discussed by committee members over the past year, the draft of Chapter 4 should "not surprise investors, given the studies that have been discussed by committee members over the past year." He added, however, that forthcoming draft chapters that could come ahead of the March 23 deadline could offer further insight on what TPSAC has learned and what action it might recommend.
Draft chapters yet to be released include topics such as: a) impact on public health; and b) potential for unintended consequences. TPSAC is scheduled to have its final meeting later this week, and Modi said another draft chapter prior to that meeting is possible.
The TPSAC nonbinding report is required by the Family Smoking Prevention & Tobacco Control Act that became law on June 22, 2009. It gives the FDA the authority to regulate the manufacture, distribution and marketing of tobacco products and bars cigarette makers from adding flavors such as clove or strawberry.
In a note last week, Modi said Lorillard shares should be worth $110 each, "without any menthol overhang." Potential TPSAC outcomes could lead to different price ranges, with a no ban recommendation likely placing it in the $90 to $100 range, a ban recommendation leading to the $60 to 65 range, a recommendation for further research leading to the $80 to $90 range and a marketing restriction recommendation leading to the $90 to $95 range.
For more of Modi's insights on menthol and Lorillard,click here to read a report in CSP Tobacco E-News.
(Alsoclick here for previous CSP Daily News coverage of the draft report.)
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