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Altria reported a $4.1 billion write-down on its Juul Labs investment on Thursday, another sizable charge as the vaping crisis continues to roil the e-cigarette industry. The company now values its 35 percent stake in the e-cigarette company at $4.2 billion, a significant drop from the $12.8 billion it paid in December 2018. Three months ago, Altria, one of the world’s largest tobacco sellers, devalued its investment in Juul by $4.5 billion. (Robertson, 1/30)

Overall, Altria has recorded $8.6 billion in impairment charges after it took a 35% stake in Juul for $12.8 billion in December 2018. Those charges brought down the value of its investment to $4.2 billion as of the end of 2019, Altria said. "I'm highly disappointed in the financial performance of the Juul investment," Altria Chief Executive Officer Howard Willard said on a post-earnings call. (Venugopal, 1/31)

“I’m highly disappointed in the performance of our Juul investment,” said Altria Chief Executive Howard Willard. He cited a number of surprises, including a vaping-related lung illness that prompted U.S. health officials to warn consumers last year not to use e-cigarettes before they determined the illnesses were linked not to e-cigarettes but to vaping devices containing marijuana extracts and vitamin E oil. Facing an accelerating decline in cigarette sales, Altria in 2018 paid $12.8 billion cash for a 35% stake in Juul, making it one of Silicon Valley’s most valuable startups. (Maloney, 1/30)

The big picture: Altria and Juul also amended certain non-financial parts of their agreement, including giving Altria an option to exit a non-compete agreement if Juul either gets banned from selling e-vaping products in the U.S. for a year, or if Altria writes down the carrying value of its investment to 10% of the original $12.8 billion price. (Primack, 1/20)

Stephen Hahn, the new head of the Food and Drug Administration, defended the Trump administration’s impending partial e-cigarette ban, which has been sharply criticized by Democratic lawmakers and public health groups as too weak. But he also vowed to take tougher steps if needed to reduce teen vaping. The administration’s vaping plan, which will take effect Feb. 6, bars sales of most flavored cartridge-based e-cigarettes. Menthol- and tobacco-flavored pods won’t be affected, nor will single-use disposable vapes or bottled e-liquids for the open-tank systems typically sold in vape shops. Those exemptions mean young people will be able to simply switch to products that remain on the shelves, critics predict. (McGinley, 1/30)

The Food and Drug Administration is banning most flavored e-cigarettes, but that isn’t keeping banana ice, sour gummy or cool mint out of the hands of McCracken County High School students. Blame a policy loophole. When the Trump administration decided to prohibit fruit, mint and dessert flavors in refillable cartridge-based e-cigarettes like Juul, it carved out a few exceptions to mollify the vape shop owners and adult consumers who complained. The much-publicized exemption allows menthol and tobacco flavors. (Kaplan, 1/31)