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Juul fights to keep e-cigarettes in the U.S. market

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Sales fell $ 500 million. The workforce has been reduced by three quarters. Operations in 14 countries were discontinued. Many national and local lobbying campaigns have been stopped.

Juul Labs, the once high-flying e-cigarette company that has become a public health villain to many because of its role in the wave of teen vaping, has functioned as a shadow of itself. , passing the pandemic largely out of public view in what he calls “reset” mode. Now her very survival is on the line as she leads an all-out campaign to persuade the Food and Drug Administration to allow her to continue selling her products in the United States.

The agency is trying to meet the September 9 deadline to decide whether Juul’s nicotine devices and pods provide enough public health benefit as a safer alternative to keep smokers on the market, despite their popularity with young people who have never smoked but have become addicted to nicotine. after using Juul products.

Major healthcare organizations, including the American Heart Association, the American Lung Association, the American Academy of Pediatrics, and the American Cancer Society’s Cancer Action Network, asked the agency to reject Juul’s candidacy.

“The stakes are high,” said Eric Lindblom, senior researcher at the O’Neill Institute for National and Global Health Law at Georgetown University, and former FDA adviser on tobacco. “If the FDA fails on this one, they will face public health lawsuits. “

Juul spares no expense to push back. Last week, the company agreed to pay $ 40 million to settle a single lawsuit (with North Carolina) over thousands of people filed against it, thus avoiding an impending jury trial. The company had urgently requested the deal to avoid testimony from parents and teens in court while the FDA re-examines its vaping products.

Juul has not made public its 125,000-page request to the agency. But he paid $ 51,000 to have the entire May / June issue of the American Journal of Health Behavior dedicated to publishing 11 company-funded studies that provide evidence that Juul products help smokers quit. To smoke. (A spokesperson for Juul said the editors rejected one of the company’s submissions.) The fee included an additional $ 6,500 to keep the newspaper by subscription open to everyone.

Three members of the journal’s editorial board resigned because of the arrangement.

And Juul’s federal lobbying has remained strong. He spent $ 3.9 million on federal lobbying in 2020, according to the Center for Responsive Politics, which tracks political spending. Altria, the big tobacco company that owns part of Juul, spent nearly $ 11 million.

Juul’s share of the vaping market has declined dramatically, falling to 42% last year, analysts said, from a high of 75% in 2018. But some public health experts fear the FDA approval could lays the foundation for the company’s growth. and extend its reach again.

Juul has long denied knowingly selling its products to teenagers and has publicly committed in recent years to doing everything possible to keep them away from minors. In its settlement with North Carolina, the company did not admit to intentionally targeting young people.

In an interview, Joe Murillo, director of regulation at Juul, said: “We have a greater opportunity than ever to convert smokers, but we will have this opportunity if and only if we continue to fight against underage use. and continue to act as the most regulated company that we are.

The company is seeking approval for its iconic vaping device, once dubbed the iPhone of electronic cigarettes, with tobacco and menthol flavored pods in two nicotine strengths: 5%, which is equivalent to nicotine in one. average cigarette pack, and 3 percent.

The decision is one of many critical issues facing the FDA – including the agency’s recent approval of a controversial Alzheimer’s disease drug and decisions on thousands of vaping products made by consumers. companies other than Juul – without a permanent commissioner in place. President Biden has yet to announce a candidate.

Recently, a House panel questioned Acting Commissioner Dr Janet Woodcock about the agency’s plans for Juul. She said the agency would base its decision on solid science and that it could not prejudge the request, which is still under review.

The decision will be based largely on the answer to two questions: will more smokers use Juul products as an exit ramp for traditional cigarettes than non-smokers will use it as a nicotine ramp? And can Juul really keep products out of the reach of children?

Much of the research Juul published in the edition of the journal he purchased follows the 12-month experience of 55,000 adults who purchased a Juul starter kit. The researchers, who were all paid by Juul, concluded that 58 percent of the 17,000 smokers who remained in the study had quit by 12 months. Twenty-two percent remained two users of traditional and electronic cigarettes, but reduced their consumption by at least half.

Elbert D. Glover, who was editor and publisher of the journal but retired shortly after the issue appeared, said the journal followed its standard protocol for scientists who verify studies before publication.

The steady decline in the number of Americans who smoke is a public health achievement. The rate fell from 42% in 1965 to 14% in 2019. Yet smoking remains the leading cause of preventable death, with some 480,000 people dying each year from smoking-related illnesses, according to the Centers for Disease Control and Prevention. .

Electronic cigarettes, which appeared in the early 2000s, were designed to give smokers the dose of nicotine they needed without the carcinogens from burning cigarettes. But until the launch of Juul in 2015, no e-cigarette had won over the public.

Juul’s sleek design and new use of nicotine salts in its pods created a nicotine-rich, low-irritant experience for mango, mint and other flavors, which quickly became a fad, especially among high school students. and college students. Public health officials feared that instead of helping adults quit smoking, Juul was hooking a new generation into nicotine, with potentially harmful effects on their developing brain health and posing other risks to their developing brain. health.

Juul’s rapid growth remained under the radar of the FDA until 2018, when the agency declared an epidemic of youth vaping.

“The FDA has left a wide open Wild West market around these vaping products and unfortunately Juul and others have taken the plunge and exploited it,” said Clifford E. Douglas, director of the University of Michigan. Tobacco Research Network. “What happened next spoiled a truly extraordinary public health opportunity for harm reduction. It is our obligation to return there to serve public health.

Mr Douglas believes that Juul is now marketing its vaping products more responsibly and that they could play a role in reducing harm for cigarette smokers.

Mr Lindblom, the FDA’s former tobacco adviser, has been very critical of Juul, but believes the FDA cannot take past bad behavior into account.

“The FDA needs to look at this prospectively and can’t really punish Juul, but it can certainly take into consideration Juul’s popularity among young people,” he said.

Many Juul critics don’t think the company deserves another chance. They are wary of the company ‘reset’, announced in September 2019 when KC Crosthwaite, a senior executive at Altria, maker of Marlboro cigarettes, became CEO of Juul.

Mr. Crothwaite ended some of Juul’s controversial lobbying campaigns in states and cities. It has closed shop in Juul’s foreign markets around the world, with the exception of Great Britain and Canada, although Juul is still sold through distributors in Ukraine, Russia, Italy and the United States. Philippines. Under public pressure, he withdrew the mint pods, which accounted for 70 percent of sales, from the market. And he suspended all American advertising.

“We need to put trust at the center of everything we do,” he wrote in an email to company staff last summer.

Critics argue that most of these changes were made at gunpoint – undertaken after the FDA threatened to shut down the company if teens continued to have access to Juul.

Of these public health advocates, Altria’s takeover of a $ 12.8 billion stake in Juul in December 2018 makes them even more suspicious.

“The Marlboro man came to Juul and now wants us to trust him,” said Matthew L. Myers, chair of the Tobacco Free Kids Campaign.

The Federal Trade Commission is now trying to unravel the Altria-Juul deal, alleging that the two companies entered into a series of deals that eliminated competition in violation of antitrust laws.

The commission argues that Altria and Juul started out as competitors in the e-cigarette markets, but as Juul became more popular, Altria faced its competitive threat by discontinuing its Mark Ten e-cigarette in exchange for a share of Juul’s profits. Both companies have denied the charges.

Even if the FDA approved Juul products, perhaps with restrictions, the company would face significant trade hurdles.

When Juul was forced to ditch its fruity flavor pods, new competitors, sometimes dubbed Juulalikes, flooded the void with cheap disposable e-cigarettes in flavors like Cherry Frost and Dinner Lady Lemon Tart. Altria now estimates Juul’s value at less than $ 5 billion, a fraction of its $ 38 billion valuation when Altria bought 35% of the company under the 2018 deal.

If Juul survives, the company will likely spend the next few years trying to settle thousands of lawsuits.

Fourteen states and the District of Columbia sued Juul, seeking money to pay for the fight against the youth vaping crisis. A criminal investigation of the company by the Justice Department is still ongoing.

There is also multidistrict litigation in a federal court in California, which has combined nearly 2,000 cases under the jurisdiction of a single judge, similar to the handling of opioid cases.

It is up to the FDA to determine if there would be a company left to collect if the plaintiffs prevail

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