Georgetown tobacco control expert outlines motivations of Altria-Juul deal
The pending deal for Altria to purchase 35% of Juul Labs should serve as a "wake-up call" for the careful monitoring of competition in the nicotine delivery market, and for evaluating how regulations and policies impact cigarette and non-cigarette firms selling alternative nicotine delivery products, says a Georgetown University professor. Juul Labs, the largest US seller of vaping products, would merge with Altria, seller of Marlboro cigarettes and a leading seller of smokeless tobacco.
Writing in Tobacco Control (Open Access), David Levy, Ph.D., professor of oncology at Georgetown Lombardi Comprehensive Cancer Center, and colleagues explore the motivations of Altria in buying Juul Labs and the motivations as to why Juul would accept the offer.
"While Juul Labs has clear motivations for the deal, Altria's motivations to pay $12.8 billion for a non-controlling stake are less clear," write Levy and his colleagues.
The researchers also explore the future impact of the deal on the US cigarette and alternative nicotine delivery markets and on public health.
"From a public health perspective, the impact of this deal will depend on whether it leads to increased cigarette use, less cigarette use, or an increase of e-cigarette use instead of cigarettes," explains Levy.
More information: "Altria-Juul Labs deal: why did it occur and what does it mean for the US nicotine delivery product market" Tobacco Control, DOI: 10.1136/tobaccocontrol-2019-055081