Sales have slumped by $ 500 million. The workforce was reduced by three quarters. Operations in 14 countries were discontinued. Many state and local lobbying campaigns have ceased.
Juul Labs, the once high profile e-cigarette company that became a public health villain for many people because of its role in the steam wave of teenagers, is acting as the shadow of its former selves, spending the pandemic largely out of the public eye in the so-called “Reset” mode. Now its survival is at stake as it launches a large-scale campaign to convince the Food and Drug Administration to keep selling its products in the United States.
The agency is trying to meet a September 9 deadline to determine whether Juul’s devices and nicotine capsules have sufficient public health benefits as a safer alternative for smokers to stay in the market despite their popularity with young people who have never smoked but became addicted to nicotine after using Juul products.
Major health 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 application.
“There’s a lot at stake,” said Eric Lindblom, senior scientist at the O’Neill Institute for National and Global Health Law at Georgetown University and former FDA advisor on tobacco. “If the FDA messes up on this case, they’ll face public health lawsuits.”
Juul spares no expense to push back. Last week the company agreed to pay $ 40 million to settle just one Lawsuit (with North Carolina) filed against thousands to avoid an upcoming jury trial. The company had made an urgent deal to avoid parental and teenage testimony in the courtroom while the FDA is reviewing its vaping products.
Juul has not made his 125,000-page application public with the agency. But it paid $ 51,000 to devote the entire May / June issue of the American Journal of Health Behavior to publishing 11 studies, funded by the company, showing evidence that Juul products help smokers quit stop. (A spokesman for Juul said editors turned down any of the company’s filings.) That fee included an additional $ 6,500 to make the subscription newspaper available to everyone.
Three members of the magazine’s editorial board resigned because of the deal.
And Juul’s federal lobbying has remained robust. According to the Center for Responsive Politics, which tracks policy spending, $ 3.9 million was spent on federal lobbying in 2020. Altria, the large tobacco company that owns part of Juul, spent nearly $ 11 million.
According to analysts, Juul’s share of the vaping market has shrunk significantly last year from a high of 75 percent in 2018 to 42 percent. However, some public health experts are concerned that FDA approval will lay the foundation for the company’s growth and expand its reach again.
Juul has long denied having knowingly sold its products to teenagers, and for several years has made a public commitment to do everything possible to keep them away from minors. In its deal with North Carolina, the company did not admit that it was deliberately targeting teenagers.
In an interview, Joe Murillo, Juul’s chief regulatory officer, said, “We have a better chance of converting smokers than ever before, but we will only get that opportunity if we continue to combat underage use and continue to act like high-ranking people regulated company that we are. “
The company is filing for approval for its iconic vaping device, once called the iPhone of the e-cigarette, with tobacco and menthol-flavored pods in two nicotine strengths: 5 percent, which is the same as the nicotine in an average pack of cigarettes, and 3 percent.
The decision is one of several critical issues the FDA has wrestled with – including the agency’s recent approval of a controversial Alzheimer’s drug and decisions on thousands of vaping products made by companies other than Juul – without a standing one Commissioner. President Biden has not yet announced a candidate.
A House panel recently interviewed Acting Commissioner Dr. Janet Woodcock on the agency’s plans for Juul. She said the agency will base its decision on sound scientific evidence and that it cannot anticipate the application, which is still under consideration.
The decision will be based to a large extent on answering two questions: Will more smokers use Juul products as an exit from conventional cigarettes than non-smokers as entry into nicotine? And can Juul really keep the products out of the reach of children?
Most of Juul’s published research in the magazine issue it purchased tracks the 12 month experience of 55,000 adults who purchased a Juul starter kit. The researchers, all paid by Juul, concluded that 58 percent of the 17,000 smokers who stayed in the study had quit after 12 months. Twenty-two percent remained double users of both conventional and e-cigarettes, but reduced their smoking by at least half.
Elbert D. Glover, who was editor and editor of the journal but retired shortly after the issue appeared, said the journal followed its standard protocol for scientists reviewing studies before publication.
The steady decline in Americans smoking is a public health success story. The rate has dropped from 42 percent in 1965 to 14 percent in 2019. Still, smoking remains the leading cause of preventable deaths, with approximately 480,000 people dying from smoking-related diseases each year, according to the Centers for Disease Control and Prevention.
E-cigarettes, which hit the market in the early 2000s, were designed to give smokers the nicotine solution they craved without the carcinogens produced by burning cigarettes. But until the launch of Juul in 2015, no e-cigarette had gained wide acceptance among the public.
Juul’s sleek design and novel use of nicotine salts in the pods made for a nicotine-rich, low-irritation experience in mango, mint, and other flavors that quickly became a fad, especially with high and middle school students. Public health officials feared that instead of helping adults quit smoking, Juul was making a new generation of nicotine addicts, with potentially harmful effects on the health of their developing brains and other health risks.
Juul’s rapid growth stayed under the FDA’s radar until 2018 when the agency declared a youth vaping epidemic.
“The FDA has created a wide open Wild West marketplace around these vaping products and unfortunately Juul and others have taken advantage of it,” said Clifford E. Douglas, director of the University of Michigan Tobacco Research Network. “What happened next screwed up a truly extraordinary public health opportunity to reduce harm. It is our duty to come back to it to serve public health. “
Mr Douglas believes Juul is now marketing its vaping products more responsibly and that they could play a role in reducing the harm to cigarette smokers.
Mr. Lindblom, the former tobacco advisor to the FDA, has been very critical of Juul, but believes that the FDA cannot take into account the bad behavior of the past.
“The FDA has to look ahead to this and can’t really punish Juul, but it can certainly take into account how popular Juul is with teenagers,” he said.
Many of Juul’s critics don’t believe the company deserves another chance. They are wary of the “company reset” announced in September 2019 when KC Crosthwaite, a top executive at Altria, the maker of Marlboro cigarettes, became CEO of Juul.
Mr. Crothwaite pulled the plug on some of Juul’s controversial state and urban lobbying campaigns. It closed its stores in Juul’s overseas markets around the world, with the exception of the UK and Canada, although Juul is still sold through distributors in Ukraine, Russia, Italy and the Philippines. In response to public pressure, he took mint-flavored pods, which accounted for 70 percent of sales, off the market. And he stopped all US advertising.
“We have to put trust at the center of our actions,” he wrote in an email to the company’s employees last summer.
Critics claim that most of these changes were made at gunpoint – after the FDA threatened to close the deal if teenagers continued to have access to Juul.
For these public health advocates, Altria’s purchase of a $ 12.8 billion stake in Juul in December 2018 makes them even more suspicious.
“The Marlboro man broke into Juul and now wants us to trust them,” said Matthew L. Myers, president of the Campaign for Tobacco-Free Kids.
The Federal Trade Commission is now trying to clear up the Altria-Juul deal, claiming that the two companies entered into a series of agreements that excluded competition in violation of antitrust laws.
The commission claims that Altria and Juul started out as competitors in the e-cigarette markets, but as Juul became more popular, Altria countered its competitive threat by discontinuing its Mark Ten e-cigarette in exchange for a share of Juul’s profits. Both companies reject the allegations.
Even if the FDA allowed Juul products, perhaps with restrictions, the company would face significant business hurdles.
When Juul was forced to discontinue its fruity flavor pods, new competitors, sometimes nicknamed Juulalikes, flooded the vacuum with cheap disposable e-cigarettes in flavors like Cherry Frost and Dinner Lady Lemon Tart. Altria now estimates Juul’s worth below $ 5 billion, a fraction of its $ 38 billion valuation when Altria acquired 35 percent of the company as part of the 2018 deal.
If Juul survives, the company will most likely spend the next few years settling thousands of lawsuits.
Fourteen states and the District of Columbia sued Juul for money to help fight the youth vaping crisis. A criminal investigation into the company by the Justice Department is ongoing.
There is also cross-district litigation in a federal court in California that has grouped nearly 2,000 cases under the supervision of a judge, much like handling opioid cases.
Whether there would still be a company that the plaintiffs could enforce depends on the FDA
