FDA Targets Walgreens as Biggest Youth Tobacco Sale Violator

(Bloomberg) -- U.S. health officials plan to ask for a meeting with top management from Walgreens Boots Alliance Inc. to discuss what they said was a pattern of illegal tobacco sales to minors at the pharmacy giant’s stores.

The Food and Drug Administration said on Thursday that it would block a Walgreens store in Miami from selling tobacco products for 30 days. But the agency also said that 22 percent of the Walgreens stores it had inspected had illegally sold tobacco products to minors.

The FDA inspected 6,350 Walgreens stores, said Michael Felberbaum, an agency spokesman. Walgreens has received more than 1,550 warning letters from the FDA and been hit with 240 financial penalties for selling tobacco to minors since 2010, he said.

“Walgreens is currently the top violator among pharmacies that sell tobacco products,” the agency said in a statement.

FDA Commissioner Scott Gottlieb said that the agency is considering additional enforcement action against Walgreens to “address their record of violative tobacco sales to youth.” The company has said recently that it is pulling back on retail sales amid broader changes in its strategy.

Walgreens said it takes the matter “very seriously” and has enacted a number of steps to address the problem, including requiring store clerks to ask anyone purchasing tobacco for identification, regardless of age, and imposing tougher disciplinary actions against employees who don’t follow its policies.

“We recognize the seriousness of this issue and welcome the opportunity to meet with the FDA Administrator to discuss all of the steps we are taking,” Walgreens spokesman Jim Cohn said in an emailed statement.

Shares of the company were down 0.7 percent to $70.99 at 1:31 p.m. in New York.

Gottlieb said that he was particularly concerned about how selling cigarettes in a pharmacy setting influenced consumer perceptions of the health effects of smoking. CVS Health Corp., the giant drugstore chain that recently merged with health insurer Aetna Inc., stopped selling tobacco products in 2014.

“The FDA will continue to hold retailers accountable by vigorously enforcing the law,” Gottlieb said.

In December, Walgreens posted mediocre quarterly results and said it would cut costs. While prescriptions increased in its pharmacies, same-store retail sales, which include items such as shampoo and beauty products as well as tobacco, fell 3.2 percent in the U.S. Walgreens blamed the decline in part on de-emphasizing tobacco.

Tobacco Spotlight

The FDA’s tobacco policies have been in the spotlight in recent months amid what health regulators have described as an epidemic increase in teen vaping. In 2017, more than 2 million middle- and high-school students used e-cigarettes, according to the Centers for Disease Control and Prevention. About 4.9 million middle and high-school students said they’d used any tobacco product in the past 30 days, according to preliminary results of the 2018 National Youth Tobacco Survey.

Vaping is viewed as a potential way to help smokers kick the habit, but has also been seen as a gateway to cigarette use for younger people. The FDA has been trying to balance the potential benefits of such devices against the possibility that they could lead to higher rates of nicotine addiction.

There is increasing concern that the increase in vaping could lead to more cigarette smoking by young users, along with a rise in the corresponding health risks, after years of headway in discouraging tobacco use. Declining smoking rates in the U.S. in recent decades have been considered a major public-health victory. Gottlieb has said that he won’t tolerate any rise in youth smoking.

Meanwhile, major tobacco companies have been betting on e-cigarettes as a way to offset a decline in sales of cigarettes and other tobacco products. Marlboro maker Altria Group Inc. spent $13 billion last year to take a 35 percent stake in Juul Labs Inc., whose vaping device is popular with younger users.

Children and teens who had used e-cigarettes were four times more likely to have taken up cigarette smoking than those who didn’t vape, according to a recent study in the Journal of the American Medical Association. And a separate study by the Harvard T.H. Chan School of Public Health found common e-cigarette flavors may harm users’ lungs.

A JAMA Pediatrics study published in November found that Walgreens was more likely than other chains to sell tobacco products to minors, even after adjusting for local demographics and state tobacco sales rules. From 2012 to 2017, Walgreens pharmacies had a far higher rate of violations of federal rules governing tobacco sales to minors than other chains, the study found.

Flavor Flashpoint

Gottlieb proposed measures in November for restricting sales of most flavored e-cigarettes and limiting them to specialized shops and online retailers that can verify a purchaser’s age. He has also taken aim at flavored tobacco, calling menthol flavors in nicotine products a major problem that has made it easy for young people to start smoking. The FDA has been said to be considering restrictions on menthol.

According to FDA rules, stores must check the photo identification of everyone under age 27 who attempts to purchase any tobacco product. Federal rules prohibit the sales of tobacco to people under 18 years old. Some states have minimum ages that are even higher.

The Family Smoking Prevention and Tobacco Control Act, signed into law in 2009, bans sales to minors and gives the FDA authority to regulate the distribution and marketing of tobacco products, according to the agency’s website.

The agency also plans to block tobacco sales at a Circle K convenience store in Charleston, South Carolina.

To contact the reporters on this story: Robert Langreth in New York at rlangreth@bloomberg.net;Anna Edney in Washington at aedney@bloomberg.net

To contact the editors responsible for this story: Drew Armstrong at darmstrong17@bloomberg.net, Timothy Annett, Mark Schoifet

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