Not too long ago, Kaival Brands Innovations Group Inc (NASDAQ:KAVL), the distributor of products manufactured by Bidi Vapor LLC, suffered a massive blow. That came about after the United States Food and Drug Administration slapped a Marketing Denial Order for the non-tobacco flavored Bidi stocks from Bidi Vapor.
However, Kaival Brands Innovations got a massive boost yesterday after the United States Court of Appeals for the 11th Circuit ruled in favor of Bidi Vapor by 2 votes to 1 and granted its petition for review. In fact, the order of the FDA was set aside by the circuit as capricious and arbitrary.
It goes without saying that it was a massive new development for Kaival Brands Innovations considering the fact that it distributes the product in the United States. Following the development, Kaival Brands Innovations came into major focus among investors and clocked gains of as much as 36.40% in the premarket trading period and hit $1.80 a share. It is now going to be interesting to see if the stock can carry this momentum over the course of the coming days and add to its gains further.
The circuit had noted that the order was arbitrary and capricious because it had not considered the sales access restriction plans that had already been a part of the Premarket Tobacco Product Applications from Bidi Vapor.
The President and Chief Operating Officer of Kaival Brands Innovations spoke about the situation as well. He noted that the electronic nicotine delivery system (ENDS) market had proven to be a major challenge for the company due to the policies of the FDA and the associated procedures. He went on to add that since Kaival Brands Innovations was the main United States distributor of the Bidi Vapor products, the latest ruling was a major development.