Tobacco giants Philip Morris International and Altria Group have scrapped merger talks as Altria-backed e-cigarette maker Juul Labs sank deeper into crisis and said it would suspend advertising in the US. 

The abandonment of the talks, announced today, comes at a time when e-cigarettes and vaping are facing intense regulatory and health scrutiny. 

Juul, in which Altria has a 35% stake, faces a US ban on some products and said its CEO Kevin Burns was stepping down.

Juul also said that it would suspend all broadcast, print and digital advertising in the US. 

Philip Morris and Altria, announcing the end of their talks, said they would instead focus on the joint launch of tobacco-heating product iQOS in the United States. 

"After much deliberation, the companies have agreed to focus on launching iQOS in the U.S. as part of their mutual interest to achieve a smoke-free future," Philip Morris CEO André Calantzopoulos said. 

The iQOS heat-not-burn product is not a typical vaping device but instead heats packages of ground-up tobacco into a nicotine-filled aerosol. 

Juul's devices, though, vaporise a liquid containing nicotine, and such e-cigarettes have borne the brunt of the regulatory crackdown.

The deal would have seen the tobacco companies reuniting a decade after their split and creating an industry heavyweight.