Mere days after launching in the world’s largest tobacco market, Juul, a leading e-cigarette producer, had its sales terminated in China; meanwhile, stock estimates have been reduced to little more than vapor, with the firm’s $38 billion valuation slowly evaporating.

Just last week the popular vaporizer launched a range of its products on two of China’s major e-commerce markets, JD.com, and the Alibaba-backed Tmall. However, things quickly came to a halt after Juul’s products were removed from the markets, seemingly without explanation.

Clearly attempting to allay investor fears, a company spokesperson for Juul reiterated the removal of their wares without adding much clarification as to why, telling Reuters:

“While JUUL products are not currently available on e-commerce Web sites in China, we look forward to continued dialogue with stakeholders so that we can make our products available again.”

Juul’s Mint Madness

Nevertheless, investors continue to worry as stock valuations within the private market go up in smoke. This is largely due to the U.S. Secretary of Health and Human Services, Alex Azar, and his coalition with the U.S. Food and Drug Administration (FDA), to proscribe all flavored e-cigarettes from the market. In a statement, Azar stressed the importance of the proposed ban.

“We intend to clear the market of flavored e-cigarettes to reverse the deeply concerning epidemic of youth e-cigarette use that is impacting children, families, schools, and communities,”

Citing data from analytics firm, Neilsen, the New York Post relays that over 75% of Juul’s total sales were made up entirely of mint-flavored refills. Certainly, investors are feeling the loss. Major backer, Altria, one of the world’s biggest tobacco corporations, fell 3.2% last Friday, bringing its total losses over the past six months to 25%.

Last year, Altria invested $13 billion in Juul labs, receiving a 35% stake in return. Today, according to sources speaking to CNBC, shares are well below Altria’s initial entry position of $250, ranging between $225-$230.

This decline in Juul’s stock price comes after yet another regulatory crackdown impacting the company. Back in July, the firm was investigated for unlawfully advertising vaping as a method to quit smoking. The FDA specifically allege that children have been a targeted demographic.

Last Monday, this culminated in a warning letter issued to Juul by the FDA, commanding the firm to change its marketing tactics, or face penalties.

The Beginning of the End

Regarding the prohibition of flavored e-cigarettes, the FDA has set a deadline for May 2020; in that time existing products that wish to stay on market are required to state their case in a formal application.

Despite the imminent market exclusion of flavored e-cigarettes, New York has taken a hasty first step, becoming the first state to ban the sale of such products. Yesterday, New York Governor Andrew M. Cuomo announced the ban, after an emergency vote by the state Public Health and Health Planning Council. Retailers now have until October 7 to cease the sale of flavored e-vaporisers and refills.

This was perhaps spurred on by President Trump’s acknowledgment of the vaping crisis, in which he condemned the use of products by children, eloquently referring to vaping as “not wonderful.”

It seems the news of health risks associated with vaping is going global. On Wednesday, Bloomberg reported that India had taken the decision to outlaw electronic cigarettes entirely, cutting off another country to which the vape industry could find sanctuary.

The crackdown came via a governmental executive order banning both the production and sale of all e-cigarettes in the country. Preeti Sudan, health secretary for the Indian government, pressed the importance of containing the proliferation of e-cigarettes before the issue grew beyond control:

Why are we debating if it’s more harmful or less? It is harmful. It is addictive … The entire next generation will be going down the drain if we don’t control it now.”

It’s safe to say that without much moral high ground and a regulatory crackdown on a global scale, Juul’s stint in hot water may be long from over.