News Update: JUUL CEO Steps Down, Ends Merger Talks with Philip Morris

JUUL, vaping related illness

At Drug and Device Watch, we continue to follow reports of illness and addiction related to JUUL brand e-cigarettes. Most recently in the news is the fact that JUUL’s CEO has stepped down. The new CEO is an executive at Altria Group Inc., the company that owns 35 percent of JUUL.

According to The Wall Street Journal, JUUL’s CEO stepped down in order for the company to focus more on regulatory matters. Altria says that they are not taking over. While the leadership shift takes place, JUUL has announced a total stop on all advertising – print, broadcast, and digital.

Merger Talks Called Off Amid Investigations

Altria, which is the parent company of Marlboro cigarettes, has recently been in talks with Philip Morris about merging. Now, talks are called off while federal investigations continue to focus on the legality of JUUL’s marketing strategies, as well as the safety of their products. Philip Morris executives reportedly are uncomfortable with the regulatory environment.

Altria and Philip Morris are already working on a joint venture, a cigarette alternative called IQOS. IQOS is a “heat-not-burn” device, which has already been authorized by the U.S. Food and Drug Administration (FDA). This is in contrast to JUUL products, which have not received FDA approval, despite their marketing campaigns and successful sales.

Uncertain Future for JUUL?

With ongoing investigations and talks about a nationwide ban on flavored e-cigarettes, the future for JUUL seems a bit uncertain. The company is currently facing mounting criticism due to:

  • A criminal probe started by prosecutors in California
  • Investigations by the FDA and the Federal Trade Commission
  • Board seats that are pending antitrust review
  • Being part of the possible cause of the vaping related illness outbreak being investigated by the Centers for Disease Control and Prevention (CDC)

Altria executives continue to support JUUL, and believe the brand will survive the controversy. JUUL maintains that they will work with the FDA and regulators to address the issue of youth vaping. They also say they are confident the brand will receive FDA approval next year.

In the meantime, the government is still planning to ban most flavored e-cigarette products, which is 80 percent of JUUL’s sales. JUUL will still be able to market their traditional e-cigarette products, but will have to change their marketing tactics. They are also doing clinical trials, and must submit that information to the FDA by May 2020.