The FDA may ban Juul in the US, dealing tobacco giant Altria a double whammy

Empty pod… Juul’s empire could be disappearing in a cloud of mango-flavored vapor. Yesterday WSJ reported that the FDA plans to ban Juul in the US. Refresher: In 2020 the FDA asked smoke juggernauts to apply to sell e-cigs (even un-flavored ones). Fast-forward to now: British American Tobacco’s Vuse — which just unseated Juul as the top US vape — got approved to stay on the market. But it sounds like Juul’s 125K-page application hasn’t.

• Glory daze: Juul became the top US e-cig seller in 2018, three years after launching its sleek vapes. That year, Marlboro maker Altria splurged $12.8B for a 35% stake in Juul, which was threatening its cig biz. Then…
• Things went up in smoke: The FDA banned flavored e-cigs in 2020 while investigating whether companies were marketing to kids, who were getting hooked on USB-like vapes.
• Puff, puff, plunge: Juul ditched flavored pods and its e-cig market share plummeted from 75% to 42%. Altria’s $13B Juul stake was worth just $1.6B as of March. Now it could lose its US biz.

Burned on both ends… Last week the FDA announced separate plans to limit addictive nicotine in traditional cigs. The rule isn’t expected to go into effect for years, if at all. But regulatory heat could hurt cig sales, which are already forecast to fall to $95B this year from $99B last year. For Altria it’s a double whammy.