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FDA temporarily suspends Juul e-cigarette ban

Yahoo Finance Live anchors discuss shares of Altria Group as the FDA temporarily suspends its e-cigarette ban on Juul.

Video transcript

BRAD SMITH: Well, let's talk about shares of Altria because these are moving, yeah, you guessed it, because of Juul. The Food and Drug Administration, they have temporarily suspended their order and the marketing denial order on Juul e-cigarettes while it conducts further review. The agency clarifying, it does not rescind it though here.

And so the agency also put out a statement on Twitter as well. I believe we have that. And particularly saying here on your screen, as you see. July 5th, FDA, they stayed the marketing denial order here.

And Juul's marketing practices had come into question for an extended period of time. Years now, we've been talking about there's too much, you know, catchy colors even that they use in some of the marketing products and on the products themselves. And so that was really impacting the type of consumer that they were selling into, thus leading into even more investigation, and thus leading even further later on to the outright initial order banning Juul sales. That came on June 23rd of this year.

BRIAN SOZZI: Yeah, Juul always made-- made sense, right, Brad? Sucking chemicals through your lungs through a plastic heated device seemed like a perfect idea to me. I still remember getting the Instagram ads popping up in my feed. Well, look, this is-- I get it. I understand why the market would cheer this for Altria.

It's been a tough few weeks, tough few months for this company, but the longer term outlook is dire, I would argue, for Altria and many of the companies that play in the space. You have major retailers essentially that have pulled out of the selling cigarettes entirely, and if they do still sell them, it is a small presence.

That comes at the time as prices for cigarettes continue to rise and you have lawmakers, what, trying to-- what was the news last week, Brad? Trying to reduce the level of menthol in cigarettes. So definitely hard to find a positive catalyst in anything related to Altria.

BRAD SMITH: Yeah, so perhaps just a little bit of relief. But it could be short-lived here for Altria in terms of the share price reaction that we're seeing here on the day. But for Juul more broadly, you've got to wonder what type of company is this going to be? If a company, if you're not allowed to market, if you're not allowed to be in certain capacities to sell the product, at the end of the day, it really comes back to where the broader move for the e-cigarette category, which has been looked at as kind of a relief to the nicotine products in the market, you know, where they might have to reshape some of those ambitious intentions that they had in order to sell some of these products going forward from here. We do know that we've got just about 30 seconds. Sorry, did you want to add on to that, Sozz?

BRIAN SOZZI: Or conversely Brad, just don't smoke. It's not good for you.

BRAD SMITH: Chew gum. Chew gum.

BRIAN SOZZI: Chew gum.

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