British American Tobacco CEO: Illegal E-cigarettes From China Are Damaging The Legal U.S. Market, And The FDA Needs To Step Up Its Crackdown

British American Tobacco CEO: Illegal e-cigarettes from China are damaging the legal U.S. market, and the FDA needs to step up its crackdown

British American Tobacco (BAT) CEO Tadeu Marroco called for heavier penalties for importing illegal e-cigarettes from China, noting that these products are damaging the legal U.S. market. Due to delays in the review and the proliferation of illegal products, BAT expects it will be difficult to achieve its revenue targets in 2025.

According to Bloomberg on July 25, the CEO of British American Tobacco (BAT) said that illegal e-cigarettes pouring into the United States from China are hurting the sales of legal cigarette alternatives.

Tadeu Marroco called for heavier penalties for those who import unauthorized e-cigarettes into the United States.

"We are seeing the legal e-cigarette market shrinking due to insufficient enforcement."

BAT is one of the tobacco producers waiting for the U.S. Food and Drug Administration's (FDA) long-running review of the e-cigarette industry, which aims to clean up the market from fruit and candy-flavored products from China that are flooding the market and attracting young users.

Marroco said the delay in the review allowed manufacturers of illegal products to take advantage of the uncertainty and continue to sell these products. He added that the FDA needs to "make public decisions about which products can stay on the market and which need to be removed from the market."

"The vast majority of unauthorized products are at risk of being investigated, such as being seized, banned, or subject to civil penalties," Brian King, director of the FDA's Center for Tobacco Products, said in an emailed statement.

The FDA and the U.S. Department of Justice have formed a federal task force across multiple agencies to stop the distribution of illegal e-cigarettes. As of early June, the FDA had issued 1,100 warning letters to manufacturers, importers, and distributors of unauthorized new tobacco products, including e-cigarettes, and fined more than 55 manufacturers and more than 140 retailers.

BAT has filed two lawsuits with the International Trade Commission, one for patent infringement and the other for the import and marketing of illegal e-cigarettes.

On Thursday (25th), BAT announced its first-half results and said that due to insufficient crackdowns on illegal products in the United States, it is expected that it will be difficult to reach its revenue target of 5 billion pounds in e-cigarettes, heated tobacco, and nicotine pouches by 2025.