MO Altria Group Inc

By Jennifer Maloney and Alex Leary 

President Trump said the U.S. plans to pull most vaping products from the market, citing growing concerns about health hazards and rising use by teenagers of the trendy alternative to traditional cigarettes.

The Food and Drug Administration intends to ban popular fruity flavors, as well as menthol and mint e-cigarettes from stores and online sellers, leaving just tobacco-flavored products. The move poses a major threat to a fast-growing market that reached $7 billion in sales last year and is dominated by startup Juul Labs Inc., which counts on mango, mint and other fruity flavors for most of its sales.

Public-health officials have encouraged adult smokers to switch to less risky products such as e-cigarettes, which deliver nicotine in a cloud of vapor. Tobacco companies have invested in the technology to offset declining sales as smokers switched to new entrants like Juul. But the sleek devices also proved popular with teens and young people who had never smoked.

About 8 million adults use e-cigarettes, but 5 million children are also vaping, including more than a quarter of high-school students, according to the latest government estimates.

"We have a problem in our country. It's a new problem," Mr. Trump told reporters in the Oval Office on Wednesday as he met with top health officials. "It's called vaping, especially vaping as it pertains to innocent children."

The move comes as officials are investigating more than 450 potential cases of pulmonary illness related to vaping products, many of them containing marijuana. Six deaths in the U.S. have been associated with the illness. The latest death, reported Tuesday, was a Kansas resident over the age of 50, the state's health department said.

First lady Melania Trump, who was in the room with the president and the health officials, has urged more regulation of vaping products, and Mr. Trump cited her concerns about the welfare of their child, Baron.

Public-health officials say sweet and fruity flavors are appealing to young people and have contributed to a surge in teen vaping. Mint, mango and other fruity flavors account for more than 80% of sales for Juul, the U.S. market leader, according to people familiar with the matter. Other vaping companies advertise flavors such as Bubblegum, Watermelon Twist and BlueRazz.

While the specific cause of recent lung illnesses is still unclear, doctors say some sort of chemical exposure related to vaping or e-cigarette use may be causing inflammation or injury in the lungs. Preliminary evidence indicates that the majority of the cases relate not to standard e-cigarettes, but to those using ingredients like THC, or tetrahydrocannabinol, the psychoactive ingredient in marijuana. Health authorities have warned people not to tamper with the devices or buy products off the street.

Outside the White House, Alex Azar, the secretary for Health and Human Services, said the administration's planned ban on mint and menthol flavored e-cigarettes was prompted by 2019 government survey data showing an alarming jump in teen use of e-cigarettes, including those flavors.

The preliminary data show that more than 25% of high-school students were e-cigarette users in 2019, up from 21% a year earlier, and the overwhelming majority of youth vapers said they used fruit and menthol or mint flavors, the HHS said.

"An entire generation of children risk becoming addicted to nicotine," Mr. Azar said. He said it would take the FDA several weeks to put out the final guidance on the new policy. Then, after a 30-day period, all e-cigarettes, except for tobacco-flavored products, would have to be removed from the market.

Manufacturers of tobacco-flavored e-cigarettes may continue to sell their products but must apply by May 2020 for an FDA review. Makers of all other e-cigarette flavors can also apply for FDA authorization, but their products would be off the market pending the review.

"The tremendous progress we've made in reducing youth tobacco use in the U.S. is jeopardized by this onslaught of e-cigarette use," said Acting FDA Commissioner Ned Sharpless.

"We strongly agree with the need for aggressive category-wide action on flavored products," a Juul spokesman said. "We will fully comply with the final FDA policy when effective."

"We agree that urgent action is needed and look forward to reviewing the guidance," said a spokesman for Marlboro maker Altria Group Inc., which owns 35% of Juul. "Reducing youth use of e-vapor products is a top priority for Altria." Altria, which previously sold flavored e-cigarettes, pulled its vaping products from the market last year before investing $12.8 billion in Juul.

The regulatory shift comes at a tricky time for Altria; the company is in negotiations to merge with Philip Morris International Inc., which sells Marlboro outside the U.S. After briefly dipping on the president's announcement, shares of Altria gained 1% to $44.72 on Wednesday. Restrictions on e-cigarettes could slow the shift to vaping and keep more people smoking traditional cigarettes, analysts say.

A ban on mint and menthol presents a significant risk to Juul's outlook, said Morgan Stanley analyst Pamela Kaufman. But the crackdown could help cigarette sales if vapers switch back or if it slows the switch to vaping, she added.

The No. 2 U.S. cigarette maker, British American Tobacco PLC, whose Reynolds American division sells Vuse branded e-cigarettes, said it doesn't sell flavors that mimic children's food or appeal to youth.

Thomas M. Burton contributed to this article.

Write to Jennifer Maloney at jennifer.maloney@wsj.com and Alex Leary at alex.leary@wsj.com

(END) Dow Jones Newswires

September 11, 2019 19:13 ET (23:13 GMT)

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