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An electronic cigarette from Juul Labs is seen on Feb. 25, 2020, in Pembroke Pines, Fla. 

The Food and Drug Administration announced Thursday that Juul Labs Inc. is required to remove all electronic cigarette products from U.S. shelves.

The agency rejected Juul’s pre-market tobacco product applications, saying they “lacked sufficient evidence regarding the toxicological profile of the products to demonstrate that marketing of the products would be appropriate for the protection of the public health.”

As a result, Juul “must stop selling and distributing these products. In addition, those currently on the U.S. market must be removed, or risk enforcement action.”

The decision to remove the No. 2-selling electronic cigarette in the country will likely to lead to a dominant market share for R.J. Reynolds Vapor Co.’s Vuse products.

Vuse held 35.1% of the market share, compared with Juul at 33.1%, according to the latest Nielsen analysis of convenience store data that covers the four-week period ending May 21. A distant No. 3 is NJoy at 3%, while No.4 is Fontem Ventures’ blu eCigs, at 1.9%.

In the pre-market application process, the FDA considers products’ risks and benefits to the population as a whole, including users and non-users. An FDA authorization is required for products to be legally marketed in the U.S.

“Today’s action is further progress on the FDA’s commitment to ensuring that all e-cigarette and electronic nicotine delivery system products currently being marketed to consumers meet our public health standards,” FDA Commissioner Dr. Robert Califf said in a statement.

The banned products include the Juul device and four types of Juulpods: Virginia tobacco-flavored pods at nicotine concentrations of 5% and 3%, and menthol-flavored pods at nicotine concentrations of 5% and 3%.

Juul has been attempting to reset the FDA’s view of its products and its reputation over the past year.

“As part of that process, the company reduced its product portfolio, halted television, print and digital product advertising, built up its science and evidence-based capabilities, and supported the Trump administration’s final flavor policy for ENDS products, while taking a methodical approach to its global presence,” the company said.

Joe Murillo, Juul’s chief regulatory officer, said in a statement Thursday that “we respectfully disagree with the FDA’s findings and decision and continue to believe we have provided sufficient information and data based on high-quality research to address all issues raised by the agency,”

“We intend to seek a stay and are exploring all of our options under the FDA’s regulations and the law, including appealing the decision and engaging with our regulator.

“We remain committed to doing all in our power to continue serving the millions of American adult smokers who have successfully used our products to transition away from combustible cigarettes, which remain available on market shelves nationwide.”

According to the latest Nielsen analysis of convenience store data, Vuse has stretched its top market share for electronic cigarettes over Juul. The report covers the four-week period ending May 21.

On May 12, the FDA authorized six Vuse products with 1.5% and 3% nicotine levels. It also issued marketing denials “for multiple other Vuse Vibe and Vuse Ciro e-cigarette products.”

Those approvals are for two Vuse Vibe power units and its tank original tobacco flavored 3.0% style, along with two Vuse Ciro power units and its cartridge original tobacco flavored 1.5% style.

British American Tobacco Plc, parent company of Reynolds, said in a May 12 statement “these authorizations represent the broadest portfolio of market authorizations provided to any company in the U.S.”

The FDA said it “has not received clinical information to suggest an immediate hazard associated with the use of the Juul device or Juulpods. “

“However, the marketing denial orders issued today reflect FDA’s determination that there is insufficient evidence to assess the potential toxicological risks of using the Juul products. There is also no way to know the potential harms from using other authorized or unauthorized third-party e-liquid pods with the JUUL device or using Juulpods with a non-Juul device.

Cowen & Co. analyst Vivian Azer wrote in an investors note that “the focus from the agency was on toxicology, which varies from the marketing denial orders that Imperial Brands received on myblu.”

“While Imperial has opted to stay on the market through the appeal process, Juul may have a harder time pursuing that route, given the potential liability. There’s a greater probability that Juul will have to remove its products from the market, and still appeal the decision.”

Anti-tobacco advocates and the FDA have accused Juul Labs of marketing their products to underage consumers.

Juul entered the mainstream retail marketplace in 2015. It has shown that a startup manufacturer can compete with the Big Three manufacturers: Philip Morris USA, R.J. Reynolds Tobacco Co. and ITG Brands LLC.

The Juul e-cigarette is sold in the form of a pen or a USB flash drive that’s easy to use — and hide — because the vapor typically does not have a smell and quickly dissipates.

Juul held a 74.6% U.S. e-cigarette market share as recently as May 2019.

However, e-cigarette sales overall have slumped since the FDA implemented its latest round of heightened regulations on the products in February 2020.

Those restrictions required manufacturers of cartridge-based e-cigarettes, such as Juul, Reynolds Vapor, NJoy and Fontem Ventures, to stop making, distributing and selling “unauthorized flavorings.”

“The agency has dedicated significant resources to review products from the companies that account for most of the U.S. market,” the FDA said Thursday.

“We recognize these make up a significant part of the available products and many have played a disproportionate role in the rise in youth vaping.”

The FDA said part of its decision was based on insufficient and conflicting data from Juul “that have not been adequately addressed and precluded the FDA from completing a full toxicological risk assessment of the products named in the company’s applications.”

The FDA said its order only pertains to the commercial distribution, importation and retail sales of these products and does not restrict individual consumer possession or use.

“The FDA cannot and will not enforce against individual consumer possession or use of Juul products or any other tobacco products,” the agency said.

In June 2021, Juul agreed to pay $40 million over six years to settle a legal complaint by N.C. Attorney General Josh Stein.

Stein announced a consent order that would require Juul “to make drastic changes to the way it conducts business.”

Stein said at that time North Carolina is the first state “to successfully hold Juul accountable for its role in spiking teen use and dependence on e-cigarettes.”

Stein’s lawsuit targeted Juul’s business and marketing practices, most notably accusing Juul of violating the state’s Unfair and Deceptive Trade Practices Act.

A Durham County Superior Court judge ruled Juul had violated court orders by destroying documents and deleting social media posts.

“For years, Juul targeted young people, including teens, with its highly addictive e-cigarette,” Stein said.

“It lit the spark and fanned the flames of a vaping epidemic among our children — one that you can see in any high school in North Carolina …”

On Thursday, Stein praised the FDA’s decision, but added that “Juul is just one participant in the industry, and I urge the FDA to come up with clear rules to limit flavors that attract teen use, marketing strategies directed toward young people, and nicotine content that accelerates addiction.”

“That way, we can ensure that other companies, like Puff Bar, don’t simply fill the vacuum created by the FDA’s action on Juul.”

The FDA said Thursday that it has authorized 23 electronic nicotine delivery system products.

In October, the FDA issued a landmark ruling in approving Reynolds Vapor’s tobacco flavor of the Vuse Solo closed electronic nicotine delivery system, its power unit and two replacement cartridges.

However, the FDA rejected submissions for 10 flavored Vuse Solo products. It said at that time it “is still evaluating” the company’s application for menthol-flavored products for Vuse Solo.

The latest FDA authorizations came June 13 involving a limited number of electronic cigarettes products of NJoy LLC, while denying the vast majority of submissions.

The FDA authorized two new NJoy tobacco products through the premarket tobacco-product application pathway. They are its tobacco-flavored disposable e-cigarettes in Daily rich 4.5% and Daily extra rich 6% — the percentages are for nicotine content.

Applications for two other menthol-flavored Daily products remain under FDA review.

On April 27, the FDA authorized NJoy Ace styles: its closed e-cigarette device and three accompanying tobacco-flavored e-liquid pods Classic Tobacco 2.4%, Classic Tobacco 5% and Rich Tobacco 5%.

BAT added the Vuse Alto styles remain under review and will continue to be available for adult nicotine consumers. The Vuse Alto PMTA was submitted nearly a year after Vuse Solo, and five months after Vuse Vibe and Ciro,

“Those applications share foundational science,” BAT said.

The FDA cautioned again that with previous authorizations of other manufacturers’ e-cigarettes, “while this action permits these specific products to be sold in the U.S., it does not mean these products are safe nor are they FDA approved.”

“All tobacco products are harmful and potentially addictive. Those who do not use tobacco products shouldn’t start.”

Altria Group Inc. said Thursday that “we are disappointed with (the FDA) decision and continue to believe that e-vapor can play an important role in harm reduction for adult smokers.”

In December 2018, Altria paid $12.8 billion for a 35% stake in Juul Labs.

As part of the Juul investment, Altria discontinued production of its electronic cigarette NuMark, which had struggled to gain traction among vapers.

It agreed to not develop and market its own e-cigs products for up to six years as long as Altria is providing services to Juul Labs.

However, by January 2020, Altria had written down for a second time the value of the investment to $4.2 billion as of Dec. 31, 2019.

By October 2020, the investment was written down again by $2.6 million to make the stake worth just $1.6 million, or just 12.5% of the initial value.

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An electronic cigarette from Juul Labs is seen on Feb. 25, 2020, in Pembroke Pines, Fla. 

According to the latest Nielsen analysis of convenience store data, Vuse has stretched its top market share for electronic cigarettes over Juul. The report covers the four-week period ending May 21.

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