The Food and Drug Administration announced on Thursday that it would ban the sale of Juul e-cigarettes in the United States.
The decision is part of the agency’s broader review of the vaping industry after years of pressure from politicians and public health groups to regulate the segment as strictly as other tobacco products after vaping has become more common among high school students.
Juul has sought FDA approval for its tobacco and menthol flavored vaping device and pods, which are available in 5% and 3% nicotine. Already in 2020, the agency banned mint and fruit vaping products in an effort to reduce teen vaping, leaving only tobacco and menthol flavored products on the market.
The decision to ban the sale of these remaining products by Juul is a blow to the company. Juul’s international expansion efforts have been hampered by regulation and lack of consumer interest. The United States remains its largest market.
The FDA said Juul’s submissions provide insufficient or conflicting data on the potential risks of using the company’s products, including whether potentially harmful chemicals could leak from Juul pods.
“Without the data necessary to determine the relevant health risks, the FDA is issuing these marketing denial orders,” Michele Mital, acting director of the FDA’s Center for Tobacco Products, said in a statement.
The FDA said it has not seen any clinical information suggesting there is an immediate risk from using Juul products. Yet, following Thursday’s decision, Juul must stop selling and distributing its products in the United States. The FDA cannot enforce individual consumers’ possession or use of the company’s e-cigarettes.
A representative for Juul did not immediately respond to a CNBC request for comment.
In FDA rulings over the past year, rival e-cigarette makers British American Tobacco and NJOY won approvals for their e-cigarettes, though the FDA rejected some of the flavored products submitted by the companies. The agency said it endorses both companies’ tobacco-flavored products because they show they can benefit adult smokers and outweigh the risks for underage users.
The FDA has also made strides to reduce the use of nicotine in traditional tobacco products. On Tuesday, the agency said it plans to require tobacco companies to reduce the nicotine content of cigarettes to minimally addictive or non-addictive levels.
In 2019, federal data revealed that more than one in four high school students had used an e-cigarette in the past 30 days, up from 11.7% two years earlier. An outbreak of vaping-related lung disease in 2020 has only heightened concerns about e-cigarettes.
Last year, use among high school students fell to 11.3% amid heightened regulatory scrutiny and the coronavirus pandemic.
Juul had been the market leader in e-cigarettes since 2018, according to Euromonitor International. In 2020, the company held a 54.7% share of the $9.38 billion U.S. e-vapor market.
Electronic cigarettes deliver nicotine to users by vaporizing liquid in cartridges or pods. Nicotine is the ingredient that makes tobacco addictive and can have other negative health effects. However, e-cigarette makers have argued that their products can deliver nicotine to addicted adult smokers without the health risks associated with burning tobacco.
Marlboro owner Altria bought a 35% stake in Juul for $12.8 billion at the end of 2018. However, Altria wrote down the value of the investment as Juul and the broader industry of the electronic cigarette have become embroiled in controversy. In March this year, Altria valued its stake at $1.6 billion, an eighth of its initial investment, and Juul itself at less than $5 billion.
The FDA’s decision will likely also hurt Juul’s defense in US courts, as it faces lawsuits from a dozen states and Washington over allegations that it marketed its products to minors and allegedly played a major role in the vaping epidemic. He has already settled with North Carolina for $40 million and Washington State for $22.5 million.
The FDA gained authority to regulate new tobacco products in 2009. Over the past decade, thousands of e-cigarettes have appeared on store shelves without any agency approval, leading to the sale of these products as it gradually introduced standards for the burgeoning industry. .
A court ruling has created a timeline for the e-cigarette company’s FDA approval process for premarket tobacco product applications. The agency is reviewing about 6.5 million applications from about 500 companies and has already denied about a million applications from smaller players like JD Nova Group and Great American Vapes for their flavored vaping products.
This is breaking news. Please check for updates.