CFRA, an independent research provider, has provided MT Newswires with the following research alert. Analysts at CFRA have summarized their opinion as follows:
Shares are ~3% lower in intraday trading on reports of Valisure’s, an independent U.S. laboratory, findings during testing of acne treatment products containing Benzoyl Peroxide (BPO). Valisure found BPO acne products are fundamentally unstable and can generate unacceptably high levels of Benzene, a known carcinogenic, when stored or exposed to higher temperatures by consumer handling. Benzene was found to potentially escape into the surrounding air at approximately 1,270 times the EPA’s calculated threshold for increased cancer risk, when measured in a compact car at 70 degrees Celsius. Clinique, one of EL’s leading brands, was highlighted as having BPO products. Visiting Clinique’s website we found 1/10 acne products listed BPO as an ingredient. This BPO acne product is not listed as a top-seller for Clinique across various e-commerce sites, warranting our Hold view. We are wary of potential reputational damage which could warrant higher marketing spend to recuperate consumer trust in Clinique products.