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JUUL Is Making Buckets of Cash, but at Least the CEO Is 'Sorry'

A generation of kids who vape, a $38 billion valuation, and an apology.

by Alex Norcia
Jul 15 2019, 10:38pm

Photo by Gabby Jones/Bloomberg via Getty Images

The CEO of JUUL Labs seems to be borrowing a strategy straight from the teenagers notorious for using his product: Ask for forgiveness, not permission.

According to excerpts posted prior to the premiere of a CNBC documentary on Monday night, Kevin Burns apologized to parents for what the Food and Drug Administration (FDA) has called an "epidemic" of teen vape use. "First of all, I'd tell them that I'm sorry that their child's using the product," Burns said. "It's not intended for them. I hope there was nothing that we did that made it appealing to them. As a parent of a 16-year-old, I'm sorry for them, and I have empathy for them, in terms of the challenges they're going through."



The mea culpa wasn't exactly a shocking one. Ever since it exploded onto the cultural scene several years ago, JUUL has come under scrutiny over whether its e-cigarettes were marketed to adults hoping to quit traditional tobacco, or more squarely targeted at teens. Last year, the New York Times reported JUUL was aware minors had been flocking to the device as early as 2015, when it first hit the market. A co-founder, James Monsees, told the paper selling to kids was "antithetical to the company's mission."

It's only gotten worse from there: Parents have filed legal complaint after legal complaint claiming that, had it not been for JUUL selling flavors like mango, their kids might not otherwise have been attracted to—and, perhaps, addicted to—nicotine. The saga has long drawn comparisons to the strategies and defenses of Big Tobacco, especially given that Altria, one of the largest producers of tobacco on the planet, took a 35 percent stake in a deal that valued the company at $38 billion in December.

Last week, around the same time a JUUL-backed coalition succeeded in putting a sales moratorium in San Francisco to a vote in November—with the intention of reversing it—a federal judge ordered the FDA to look over the company's application for approval within ten months. (It has been selling without formal approval thanks to some FDA leniency in the interim, though the agency has also investigated whether JUUL deliberately went after young users.) That means that even if we're not likely to find out what the long-term effects of vape use are in the coming weeks, JUUL may be doing more apologizing in the near future.

The problem is we don't know yet exactly what JUUL's profiteers have to feel bad about. The company did stop selling fruit-flavored pods to brick-and-mortar stores, for instance. But allegedly sketchy advertising and sales practices aside, vaping is too new a phenomenon for experts to have definitive long-term data. While there's research suggesting vaping may eventually prove just as dangerous as smoking traditional cigarettes, some experts believe the benefit it could provide to current smokers looking to quit is too good to ignore.

"It's a major breakthrough in smoking cessation technology," said Michael Siegel, a professor in the School of Public Health at Boston University. "But the unfortunate side effect is that we now have the problem of youth vaping, which has turned into a problem of youth addiction, which we didn't have before."

Vaping has, to its benefit, recent studies linking it to helping cigarette smokers quit—and JUUL has rebranded itself, basically, as a crusader for public health.

"The big picture of e-cigarettes in general is that, from a public health perspective, there's a tension between concerns about kids taking up nicotine verses the potential for e-cigarettes to help smokers quit," said Neal Benowitz, a professor in the School of Medicine at the University of California, San Francisco. "The two communities are still trying to figure out how to deal with those two separate issues."

To accept Burns's apology, then, you have to decide which side you're on: If you remain skeptical of JUUL's tactics, or if you view vaping as (at least one) solution to a public health problem—as a way of abating the leading cause of preventable death in the United States.

"Saying you're sorry is too little too late for the nearly 5 million children in this country using e-cigarettes," said Dennis Herrera, the city attorney for San Francisco who introduced the local "e-cig ban" JUUL and its allies are challenging at the ballot. "Before that, so much progress had been made preventing youth smoking. We were poised to have a generation of American kids not addicted to nicotine."

On the other hand, Kenneth Warner, a professor emeritus of public health at the University of Michigan and former president of the Society for Research on Nicotine and Tobacco, thinks the narrative of kids getting hooked on JUUL has eclipsed the reality of vaping helping longtime cigarette smokers ditch their fatal habit. Still, he understands complaints about the company's marketing techniques.

"His apology could be seen as a double entendre," Warner said of Burns. "That he does genuinely feel bad that a number of kids are using the product, and that he is also sorry that this is disadvantaging the company—and the vaping market in a broader sense."

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