R.J. Reynolds vs. JUUL: Corporate Cat Fight!

June 26, 2019

It isn't often that I find myself agreeing with R.J. Reynolds, maker of Camel, Pall Mall, and Newport cigarette brands, but there's finally something that unites us: hatred of the e-cigarette behemoth JUUL.

On April 29, R.J. Reynolds took advantage of the FDA's request for comments regarding efforts to tighten regulations on vaping products and some of what Reynolds had to say came across as downright catty.

"[The] FDA already has identified the main driver of youth interest: Juul," wrote Reynolds. Reynolds pointed out that most teens were reporting that they prefer and use JUUL brand e-cigs.

Of course, Reynolds' finger pointing does seem somewhat disingenuous (and maybe even a little bitter) given the fact that its Vuse brand only holds a 13.7% market share whereas JUUL commands 74.6%. Naturally, more teens are going to be found with JUULs in their hands.

Vuse Brand E-Cigarettes

R.J. Reynolds said it fears the FDA will "indiscriminately penalize the entire portfolio of flavored ENDS products," rather than doing what Reynolds is hoping for: targeting JUUL.

R.J. Reynold's comments clearly raised the fur on JUUL's back.

"...It is disappointing, but not surprising, to see a legacy tobacco company whose core business remains combustible cigarettes--the very product we intend to eliminate by offering adult smokers an alternative---attempting to thwart the category-wide regulation that's needed," JUUL shot back.

Of course, JUUL's holier-than-thou, "You-are-a-tobacco-company-while-we-are-saving-smoker's-lives" attitude rings even more hollow than R.J. Reynolds' protests.

First of all, while JUUL is trying to pretend it isn't a part of Big Tobacco, the fact is that Altria, owner of the Marlboro brand among others, owns a 35% stake in JUUL. JUUL is every bit in bed with "a legacy tobacco company."

Marlboro Brand Cigarettes

Second, JUUL's virtue signaling posture--that it welcomes regulation--is nothing more than a painfully transparent knife in the back to the very adult smokers JUUL claims to be trying to save.

In a presentation to a room full of financial analysts, Altria made clear that Altria and JUUL intended to work together to:

Encourage FDA to take industry-wide action by banning retail and vape store sales of all non-traditional flavors until the youth issue is otherwise addressed, such as by the use of advanced age verification technology or premarket authorization.

You can rest assured that Altria ain't supporting the country wide ban of vape juice flavors out of the goodness of its heart or out of any genuine concern about under age vaping. The simple fact that this statement was made to a room full of suits looking to assign financial valuations to the companies shows that Altria and JUUL believe an FDA flavor ban will increase their bottom lines.

Altria Brand

Altria and JUUL hope to knock the remaining players out of the vaping market by using the FDA to ban all flavors temporarily. This would kill vape shops, small vape businesses and any other players who can't afford the millions of dollars it will cost to get a Premarket Tobacco Application approved. The effect? Handing another large chunk of the remaining market share to JUUL at the cost of denying every adult vaper in the United States the choice to use flavored vape juices.

R.J. Reynolds, of course, is also trying to use the FDA to knock out it's own competition. No need to target all e-juice flavors when the FDA could just go after the main culprit.

“As [the FDA's] public statements confirm, underage users disproportionately prefer Juul to all other products. ... Armed with such knowledge, we believe the agency can take appropriately tailored steps to curb youth use,” R.J. Reynolds sniffed.

Meow!



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