Massachusetts Vape Ban Could Fuel Higher Cigarette Sales

BOSTON — The emergency ban on the sale of electronic cigarettes and vaping products in Massachusetts and other states may have an unintended consequence. Analysts at Moody's said in a report released last week that such bans could drive higher sales of cigarettes and other nicotine products.

The report came after tobacco giant Altria took a $4.5 billion charge for its 35 percent stake in e-cigarette maker JUUL Labs Inc. Altria made the investment in December 2018 to hedge against projections that its cigarette sales would decline 4 to 6 percent per year. Altria didn't link the write-down to the emergency Massachusetts ban and instead said it was concerned about the increasing potential for a nationwide crackdown by the U.S. Food and Drug Administration.

Before increased concerns about an FDA action on e-cigarettes, Moody's projected Altria could expect about $200 million in revenue from its JUUL investment over 12 to 18 months. Now, however, analysts are saying such a ban could slow the decline of its cigarette sales "as fewer alternative products will be available to smokers who want to quit."

On Sept. 24, Massachusetts Gov. Charlie Baker declared vaping a public health emergency and called for a four-month moratorium on the sale of all vaping products. A judge ruled Oct. 21 the ban could stand after a group including the Vapor Technology Association filed a suit saying it was unconstitutional.

Last week, state officials confirmed the second vaping-related death in Massachusetts.