- A dozen states and more than 450 local governments have increased the tobacco buying age to 21.
- Lawmakers are considering federal legislation to raise the age, an effort called T21.
- Altria, Juul and British American Tobacco are supporting the efforts.
A movement to raise the smoking age across the U.S. to 21 has an unlikely supporter: Big Tobacco.
A dozen states and more than 450 local governments have already increased the minimum age to 21 from 18. Congress will soon consider a federal ban, with Senate Majority Leader Mitch McConnell planning to introduce a bill and a number of lawmakers already submitting their own legislation.
Altria, Juul and British American Tobacco — the largest U.S. cigarette and e-cigarette manufacturers — are supporting the efforts. Lawmakers and regulators are pressuring the companies to fix a teen vaping "epidemic" that has vexed parents, teachers and public health advocates.
"This is a public relations maneuver in order to deflect attention from pressure the [Food and Drug Administration] has put on them," said Rob Crane president of the Preventing Tobacco Addiction Foundation.
Sales, measured by the volume of cigarettes shipped, are already declining by about 4% every year. If the minimum age to buy tobacco products increased to 21 in all 50 states, that rate would bump up to about 4.6%, Cowen analyst Vivien Azer estimates. That figure does not include e-cigarettes, which could be at greater risk given federal data show more teenagers are vaping than smoking.
Still, companies wouldn't be giving up much, especially compared to more onerous restrictions like banning flavors or pulling some products off the market altogether. Lawmakers and regulators are already debating both possibilities.
"Do we worry the marketplace could be restricted for smokers who benefit from the products because of the youth issue? That's part of it, but frankly it's the right thing to do," Juul CEO Kevin Burns said in an interview.
Smoking starts young
Most smokers start before they turn 18, making youth prevention a top priority for health groups. Crane has been advocating to raise the tobacco buying age since 1996.
He hardly got anywhere until 2005, when Needham, Massachusetts became the first town in the U.S. to raise the age to buy cigarettes and other tobacco products to 21. Hawaii became the first state to hike the age to 21 in 2015.
The issue still wasn't a top priority for lawmakers. Then came Juul.
After decades of successfully convincing teens not to smoke cigarettes, teen tobacco use soared last year thanks to e-cigarettes. Then-FDA Commissioner Scott Gottlieb told the country's top e-cigarette manufacturers to come up with solutions.
Raising the age to buy tobacco emerged as one. Altria, which sells best-selling cigarette brand Marlboro and owns a 35% stake in Juul, announced in October it supports raising the tobacco buying age to 21 after years of opposing the move.
"We changed our position, quite frankly," said Jennifer Hunter, senior vice president of corporate citizenship at Altria Client Services. "When you have a regulator that has characterized the rise in youth vapor as an epidemic and has called for the industry to do more, we stepped up and said that was one of the things we should support."
British American Tobacco also reversed its opposition in October. The company thought it was a "reasonable approach" to preventing teens from accessing tobacco products, said Michael Shannon, Vice President Communications and Policy at Reynolds American, a unit of BAT.
Juul started supporting the campaign, called T21, in April of 2018.
Juul has spent more than $2 million running ads supporting T21. Altria said it's early in the campaign, but it estimates it's spent "in the seven figures."
Their efforts are working. Of the 12 states that have passed T21 laws since 2015, eight did so this year. Yet public health groups say that might not necessarily be a good thing.
"I can certainly say [the tobacco industry's involvement] has moved things forward on this policy and we won't know the positive or negative until we see how effective these policies have been," said Ashley Bell, vice president of field advocacy for the American Heart Association.
Critics also say companies are stuffing legislation with industry-friendly measures like preventing local governments from banning fruity flavors, which regulators say appeal to kids and companies say help adults switch from conventional cigarettes.
An Arkansas bill raising the minimum tobacco buying age to 21 also banned local governments from pursuing tighter restrictions, such as limiting e-cigarette flavors. Lawmakers in Arizona are considering similar legislation.
"We strongly support raising the age to 21, but we can't support a bill that preempts cities from taking additional tobacco control measures," said Campaign for Tobacco-Free Kids President Matthew Myers.
Altria and Juul say they prefer lawmakers pass "clean" T21 bills. BAT says sometimes issues get combined in legislation but it's "always clear" it supports raising the age to 21.
For more on investing in health-care innovation, click here to join CNBC at our Healthy Returns Summit in New York City on May 21.