Breaking News
Get Actionable Insights with InvestingPro+: Start 7 Day FREE Trial Register here
Investing Pro 0
Ad-Free Version. Upgrade your Investing.com experience. Save up to 40% More details

U.S. bans sales of Juul e-cigarettes, company to seek stay on enforcement

Stock Markets Jun 23, 2022 11:40PM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
 
© Reuters. FILE PHOTO: An electronic cigarette device made by JUUL is shown in this picture illustration taken September 14, 2018. REUTERS/Mike Blake/Illustration

By Chris Kirkham and Aishwarya Venugopal

(Reuters) -Sales of Juul e-cigarettes were blocked by the U.S. Food and Drug Administration on Thursday, in a major blow to the once high-flying firm whose products have been tied to a surge in teenage vaping.

The agency said the applications "lacked sufficient evidence" to show that sale of the products would be appropriate for public health, following a nearly two-year-long review of data provided by the company.

Some of the findings raised concerns due to insufficient and conflicting data, including whether potentially harmful chemicals could leach out of the Juul pods, the FDA said.

"We respectfully disagree with the FDA's findings ... intend to seek a stay and are exploring all of our options under the FDA's regulations and the law, including appealing the decision and engaging with our regulator," said Joe Murillo, chief regulatory officer at Juul.

The company said it had appropriately characterized the toxicological profile of its products and that the data met the statutory standard of being "appropriate for the protection of the public health".

Juul and other e-cigarette brands, including British American Tobacco (NYSE:BTI)'s Vuse and Imperial Brands (OTC:IMBBY)' Blu, had to meet a September 2020 deadline to file applications to the FDA showing the products provided a net benefit to public health.

The heath regulator had to judge whether each product was effective in getting smokers to quit and, if so, whether the benefits to smokers outweighed the potential health damage to new e-cigarette users, including teenagers, who never smoked.

BAT (LON:BATS)'s Vuse Solo was the first e-cigarette to get the agency's clearance in October.

"The agency has dedicated significant resources to review products from the companies that account for most of the U.S. market. We recognize ... many have played a disproportionate role in the rise in youth vaping," FDA Commissioner Robert Califf said in a statement.

Teenage use of e-cigarettes surged with the rise in popularity of Juul in 2017 and 2018. Its use among high school students grew to 27.5% in 2019 from 11.7% in 2017, but fell to 11.3% in 2021, a federal survey showed.

Juul did not provide evidence to show the products were up to its standards and that raised "significant questions", the FDA said, but added it has so far not received clinical information to suggest an immediate hazard tied to the device or pods.

"Without the data needed to determine relevant health risks, the FDA is issuing these marketing denial orders," Michele Mital, acting director of the FDA's Center for Tobacco Products, said.

Shares of tobacco giant Altria Group (NYSE:MO) Inc, which partly owns Juul, have lost about 7%, or nearly $6 billion in market value, since Wednesday when the Wall Street Journal first reported the FDA was preparing to order Juul's e-cigarettes off the market.

'HAWKISH FDA'

Juul had sought approval for its vaping device and tobacco and menthol flavored pods that had nicotine content of 5% and 3%.

E-cigarette makers have been selling products in the United States for years without being officially authorized by the FDA, as regulators repeatedly delayed deadlines for the companies to comply with federal guidelines.

Thursday's decision was cheered by public health groups, who had long warned that e-cigarettes were getting a new generation of teenagers hooked on nicotine after major strides in reducing youth cigarette use.

In 2020, the FDA banned all flavors except tobacco and menthol for cartridge-based e-cigarettes such as Juul. The company pulled all other flavors including mint and mango in late 2019.

The Biden administration has been looking at other ways to help people quit smoking in an effort to cut down on preventable cancer deaths. It said this week it plans to propose a rule establishing a maximum nicotine level in cigarettes and other finished tobacco products to make them less addictive.

The surprise decision was an indication of a more hawkish FDA, some analysts said, as it was expected that some Juul products would be approved, following the agency's clearance of several other e-cigarette products.

BAT overtook Juul as the leader of the U.S. vaping market in April, according to data Nielsen provided to brokerage J.P. Morgan. Juul led the market in 2021, with a 38% share of the $11 billion retail sales market.

"The only opportunity for Juul to create value may be in international markets, but we expect other regulators to take a similar stance to the FDA in limiting the marketing of e-cigarettes to minors," Morningstar analyst Philip Gorham said.

U.S. bans sales of Juul e-cigarettes, company to seek stay on enforcement
 

Related Articles

Xerox CEO John Visentin Dies Unexpectedly
Xerox CEO John Visentin Dies Unexpectedly By Investing.com - Jun 29, 2022

By Davit Kirakosyan Xerox (NASDAQ:XRX) made an announcement, according to which John Visentin, Vice Chairman and CEO, who joined the company in 2018, passed away unexpectedly...

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:  

  •            Enrich the conversation, don’t trash it.

  •           Stay focused and on track. Only post material that’s relevant to the topic being discussed. 

  •           Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.

  • Use standard writing style. Include punctuation and upper and lower cases. Comments that are written in all caps and contain excessive use of symbols will be removed.
  • NOTE: Spam and/or promotional messages and comments containing links will be removed. Phone numbers, email addresses, links to personal or business websites, Skype/Telegram/WhatsApp etc. addresses (including links to groups) will also be removed; self-promotional material or business-related solicitations or PR (ie, contact me for signals/advice etc.), and/or any other comment that contains personal contact specifcs or advertising will be removed as well. In addition, any of the above-mentioned violations may result in suspension of your account.
  • Doxxing. We do not allow any sharing of private or personal contact or other information about any individual or organization. This will result in immediate suspension of the commentor and his or her account.
  • Don’t monopolize the conversation. We appreciate passion and conviction, but we also strongly believe in giving everyone a chance to air their point of view. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
Comments (1)
Robert Murphy
Robert Murphy Jun 23, 2022 3:01PM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Yet ciggerets are still on the shelf of every gas station in the United States. Its about your health!
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Continue with Google
or
Sign up with Email