Kathleen Sebelius, former Health and Human Services secretary, told CNBC on Wednesday that she’s concerned about Marlboro-maker Altria having a large stake in e-cigarette leader Juul.
“Altria made their money and staked their company on selling legal products, but products that we knew if you used them exactly as directed, they would kill you,” said Sebelius, who led HHS during Barack Obama‘s presidency.
Since launching in 2015, Juul has come to dominate the e-cigarette industry with roughly 40% of the market. It got so big that Altria, the top U.S. cigarette company, invested $12.8 billion last year for a 35% stake.
However, along the way, Juul’s e-cigarettes, particularly its flavored nicotine products, became popular among young people, fueling what government regulators are calling a teen vaping epidemic. The FDA is currently finalizing its guidance to remove all nontobacco flavors of e-cigarettes, including mint and menthol, from the market within 30 days. Some state and local governments are starting the removal process too.
E-cigarette makers are “using exactly the same techniques that tobacco companies used in the early days to market to kids, to be cool to kids,” Sebelius added. “That’s a very dangerous public health path for us to go down again.”
The “perfect storm” of two crises are colliding, said Sebelius, referring to the surge in teen e-cigarette use and a vaping lung disease that’s made hundreds of people sick and killed nine.
“We have a new product in the market that is addictive. We don’t really know how much harm it’s going to do. We don’t really know what it’s going to do to kids,” said Sebelius, also formerly the governor of Kansas.
At the Global Tobacco & Nicotine Forum in Washington, D.C., on Wednesday, Altria Chairman and CEO Howard Willard said, “This is a pivotal moment for the industry and strong leadership and action are urgently needed.”
Willard’s comments follow a major shake-up at Juul, which announced Wednesday morning that Kevin Burns resigned as CEO, and that he’s being replace by former Altria executive K.C. Crosthwaite.
Earlier this month, federal health officials accused Juul of illegally advertising its nicotine pods as a safer alternative to regular cigarettes.
While some research does support the idea that vaping can help adults quit smoking, Sebelius said that if Juul wants to market itself as a safer alternative it needs to prove “smoking cessation efficacy.”
CNBC.com
