A sign advertising Juul brand vaping products is seen outside a shop in New York City, February 6, 2019.
Mike Segar | Reuters
The Food and Drug Administration will reportedly seek more time before deciding if Juul can continue to sell its e-cigarettes in the United States, the Wall Street Journal reported Thursday.
A court mandate created a timeline for the agency to review vaping products, following years of pressure from politicians and public health groups to regulate the segment as strictly as other tobacco products.
The FDA did not immediately respond to a request for comment from CNBC.
The agency has until Thursday to review roughly 6.5 million product applications from about 500 companies and decide if manufacturers demonstrated that their products are in the interest of public health. If an application hasn’t been approved or denied by that deadline, the products have to be pulled from the U.S. market until the FDA makes its decision.
Because of those rules, the FDA said that it would fast track decisions for market leaders like Juul, although it didn’t expect to make decisions on all of the millions of product applications by the deadline. So far, however, the FDA has only issued decisions on smaller players.
In late August, it denied 55,000 applications from smaller players like JD Nova Group and Great American Vapes for their flavored vape products. Flavored e-cigarettes have been the focus of many public health groups’ ire because of concerns over underage use. According to vaping trade groups, the agency issued more denials on Wednesday.
“Lots of very good people who I respect deeply and who helped thousands of smokers quit, got told by our government that their products were illegal,” tweeted Amanda Wheeler, president of the American Vapor Manufacturers Association.
Juul has been the market leader in e-cigarettes since 2018, according to Euromonitor International. As of 2020, the company held 54.7% share of the $9.38 billion U.S. e-vapor market.
Marlboro owner Altria bought a 35% stake in the company for $12.8 billion in late 2018. However, Altria has slashed the value of the investment as Juul and the broader e-cigarette industry became embroiled in controversy. As of September 2020, Altria valued its stake at $1.6 billion, an eighth of its original investment, and Juul itself at under $5 billion.
Altria’s stock was down less than 1% in morning trading, while shares of British American Tobacco, which makes Juul rival Vuse, were down 1.7%.