LONDON (Reuters) - British American Tobacco said on Friday it was not surprised by the U.S. Food and Drug Administration's announcement that it plans to reduce nicotine levels in cigarettes.

The company said it was well prepared for the upcoming policy discussion.

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In a major regulatory shift announced on Friday that sent shares of traditional cigarette companies plunging, the FDA said it aims to reduce nicotine levels in cigarettes while exploring measures to move smokers toward e-cigarettes.

"Our American subsidiary, Reynolds American Inc. and its operating companies are encouraged by FDA Commissioner Dr. Scott Gottlieb’s comments today recognizing tobacco harm reduction policies and the continuum of risk for tobacco products," a British American Tobacco spokesperson said.

“Dr. Gottlieb’s comments regarding nicotine and menthol do not come as a surprise to us. We are well prepared and look forward to participating in a thorough process to develop a comprehensive plan for tobacco and nicotine regulation."

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(Reporting by William James; Editing by Susan Fenton)