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Juul agrees to pay $438.5 million in biggest settlement yet, as another vape maker gains momentum • TechCrunch


Juul has long maintained that it is trying to save lives; meanwhile, his own existence sometimes seems precarious.

Right now is one of those times. As reported earlier today by multiple outlets, the once high-flying e-cigarette company has just agreed to a $438.5 million settlement with 33 states that alleged the company was marketing its product to underage users.

Connecticut Attorney General William Tong announced the settlement, noting that in addition to financial terms, the settlement will require Juul to adhere to specific marketing and sales practices, including refraining from representing anyone from under 35 in marketing in movies, on billboards, or on social media, or to sell Juul-branded products.

The company has also agreed never to fund educational programs in schools again, even though it increased the short-lived practice years ago under pressure from regulators. (In 2018, Juul sponsored a summer camp in Baltimore, among other initiatives that came before and after. In 2019, when Juul executives were questioned by a House subcommittee that accused Juul of targeting schools and youth camps, a Juul spokesperson told The New York Times that in total, the company has awarded six undetermined grants to schools and youth programs for health and vaping prevention.)

The new settlement — to be paid over six to 10 years — is by far the largest Juul has agreed to. Since last year, as noted by the WSJ, Juul has agreed to pay a total of $87 million in settlements with four other states that have sued the company, including Louisiana, Arizona, North Carolina and Washington. Meanwhile, Juul is still facing thousands of other lawsuits, including cases brought by nine other attorneys general.

That the company did not dissolve itself in a cloud of smoke is a miracle. The company’s sleek, rechargeable vaping devices and nicotine pods in sweet flavors like cucumber, mango, mint and crème brûlée became hugely popular with teens soon after Juul launched in 2015. But at first As of 2018, the outfit was being sued by customers who said they had become addicted due to the product’s high nicotine levels.

Yet wWith sales skyrocketing and investors knocking on its door, Juul executives have repeatedly denied it was targeting teenagers, even though previous ads showed attractive, seemingly very young men and women with devices. Juul in hand. The company – arguing that its products were designed for adult smokers looking for a safer alternative to combustible cigarettes – instead stepped up its lobbying efforts in Washington.

He, however, underestimated the power of the FDA and the agency’s then commissioner, Dr. Scott Gottlieb, who in the fall of 2018 declared youth vaping an “epidemic.” .

Indeed, that same fall, the agency gave Juul, along with many other vaping makers, a deadline to submit “robust” plans to prevent youth vaping, and the FDA was not satisfied since by Juul’s alleged efforts to drive away its teenage market. In fact, in June, the FDA ordered Juul to remove its products from the US market. It has since suspended that ban while Juul appeals the decision.

Juul obviously hopes that this huge new regulation will allow the company to regain the trust of regulators and move forward. But even as the company – which sold 35% of its business to tobacco giant Altria for $12.8 billion at the end of 2018 – is dissolving into steam under the weight of all those settlement deals, unresolved lawsuits and… ‘continued opposition, it is apparently too late to stop what Juul started.

Along with other earlier Juul rivals, a new product is now taking the market by storm. This time it’s a disposable e-cigarette brand called Puff Bar. According to the WSJ, the two-year-old Los Angeles-based company overtook Juul a year ago as the most popular e-cigarette among American high schoolers, many of whom still puff.

Although around 20% of high school students said they used an e-cigarette at least once in a 30-day period in 2020, based on a nationwide survey conducted online, around 11% said in that same survey in 2021 that they used e-cigarettes at least once in the past 30 days.

Surprisingly, Puff Bar has even more flavors – 16 in all – including banana ice cream, fresh mint and strawberry.

Its ads are also eerily reminiscent of early Juul commercials, in one instance depicting a young woman obscured by smoke and, in another, encouraging users to take a “solo break” to “escape…parental texts.”

Apparently, Puff Bar was able to circumvent the FDA because it says its nicotine is not derived from tobacco but instead relies on synthetic nicotine. Meanwhile, the FDA told the WSJ last fall that it was considering how to handle the company and other synthetic tobacco makers.

No doubt current and former Juul executives are watching with great interest to see what happens next.

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