Shares of alcohol distributors and brewers tumbled on Friday after a surgeon pleaded for cancer warning labels. The US Surgeon General, Dr. Vivek Murthy, linked alcohol to cancer risks in a report.
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Murthy's report advised the public about alcohol's increased risk of developing cancer in the colon, breast, and liver, among others. He noted how most Americans "are unaware of this risk" which is the third leading cause of preventable cancer.
Surgeon General Warns Of Cancer Risks With Alcohol Use
"Evidence shows that the risk of developing cancer may start to increase around one or fewer drinks per day," Murthy's advisory wrote. This is concerning specific cancers like "breast, mouth, and throat."
Murthy is the main spokesperson for the federal government concerning public health, which makes the shares falling unsurprising. The surgeon's main goal of the report was to call for cancer warnings and labels. This could inform consumers of recommended alcohol consumption levels and the dangers overconsumption can pose.
After dropping this advisory, stocks for beer, wine, and spirits brands plummeted. Diageo, owner of popular spirits like Smirnoff and Captain Morgan, fell by 4%. Meanwhile, beer producer Molson Coors declined by 5%, and Boston Beer by 6%.
Constellation Brands shares fell to 2%, the producer of over 100 alcohol brands. Brown Forman owns different spirits brands, and its stocks fell as much as 4%.
According to Murthy in this report, less than half of the US population knows alcohol is a huge risk factor for cancer. While the majority of Americans know how dangerous smoking cigarettes can be, alcohol education isn't the same.
It's been nearly 40 years since alcohol labeling changed. It seems it's time for a change as research has discovered much more about the dangers of alcohol. Currently, labels only warn of risks to pregnant women. They also warn consumers not to drink and drive a vehicle or operate machinery.
Although some health issues appear on alcohol labels, none feature risks of cancer. There's no telling yet whether this report will influence alcohol warning labels to change. At least the stark change in shares will have more people talking about Murthy's advisory and the dangers of alcohol overconsumption.
