eCommerce giant Amazon (NASDAQ:AMZN) has received a warning letter from the U.S. Food and Drug Administration (FDA) regarding the distribution of products on its platform that violate the Federal Food, Drug, and Cosmetic Act.
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The healthcare regulator purchased products on Amazon labeled as energy-enhancing supplements or food but were found to contain undeclared and potentially harmful active pharmaceutical ingredients. Specifically, products, including MANNERS Energy Boost, Round 2, and Mens Maximum Energy Supplement, were found to contain the active pharmaceutical ingredient tadalafil without any declaration in product labeling.
Now, the FDA has asked Amazon to address these concerns. The company has fifteen days to submit a written response to the agency. Last month, the FDA warned Amazon against selling seven unapproved eye drops on its platform. As a result, the company removed the products from its marketplace.
In another development, Amazon is introducing advertisements on Prime Video content. The company plans to introduce commercials in the U.S., UK, Germany, and Canada on January 29. The limited advertising is set to expand into other major markets later in 2024. The company is also planning to offer a new ad-free option for additional payments.
Is Amazon a Buy, Sell, or Hold?
Meanwhile, the Street has a Strong Buy consensus rating on Amazon, and the average AMZN price target of $181.05 implies an 18% potential upside in the stock. That’s on top of a nearly 85% rally in the company’s share price over the past year.
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