Tag: Juul Labs

  • FTC Staff Urges Timely Start of Altria Trial

    FTC Staff Urges Timely Start of Altria Trial

    Photo: Paul Brady – Dreamstime.com

    U.S. Federal Trade Commission staffers urged the commission to start its trial against Altria Group’s $12.8 billion investment in Juul Labs in April as scheduled, reports Law360.

    The cigarette giant had requested a three-month delay from the current April 12 start, speculating that it will be safe to hold an in-person trial by mid-July. The current April trial will be virtual due to the Covid-19 crisis. The trial was previously moved from Jan. 5 to mid-April because of the pandemic. Altria and Juul said a virtual hearing would diminish their attorneys’ ability to assess the credibility of the testifying witnesses.

    In a filing Thursday to the agency’s commissioners, the FTC’s trial staff said that hopes for an in-person, Covid-free proceeding by July are “highly speculative.”

    “While the vaccine news is promising, the timetable for the chief administrative law judge and his staff, witnesses and counsel to receive vaccinations is highly uncertain at this time,” the staffers said. “And, while complaint counsel shares respondents’ concerns regarding the severity of the pandemic, these concerns can be remedied by proceeding with a virtual hearing.”

    The FTC case alleges that that Altria shut down its own e-cigarette business to pave the way for the investment, in the process eliminating competition in violation of antitrust laws.

     

  • Higher-Nicotine Juuls May Facilitate Switching

    Higher-Nicotine Juuls May Facilitate Switching

    Photo: Juul Labs

    The nicotine delivery of Juul products available in the United States and Canada (59 mg/mL or 5 percent nicotine by weight) more closely resembles the nicotine delivery and experience of cigarette smoking than Juul products available in the European Union, which contain 18 mg/mL and/or 9 mg/mL of nicotine, according to a new study from Juul Labs published in Nicotine & Tobacco Research.

    Researchers posited that heavier and more dependent smokers in particular may require the greater nicotine delivery of the higher nicotine concentration Juul pods (59 mg/mL) in order to successfully transition away from cigarettes.

    The new study, which consisted of 24 adult smokers, assessed the nicotine delivery and subjective effects of combustible cigarettes compared to the Juul system with three nicotine concentrations: 59 mg/mL (U.S. and Canada), 18 mg/mL (U.K. and Canada) and 9 mg/mL (U.K.).

    At each of five study visits, participants used one of four Juul products or smoked their usual brand of cigarette during controlled (10 puffs) and ad libitum use (5 minutes) sessions. Blood samples were collected, and levels of nicotine in the bloodstream were measured for each study product. Subjective effects, including relief of craving for cigarettes and withdrawal symptoms, were assessed 30 minutes after participants used each product.

    The higher concentration (59 mg/mL) Juul product delivered significantly greater levels of nicotine and significantly reduced craving and withdrawal compared to the Juul with 18 mg/mL and 9 mg/mL nicotine concentrations. Researchers concluded that the lower nicotine delivery and craving relief from the 18 mg/mL and 9 mg/mL Juul pods available in the EU may limit the product’s ability to provide a satisfying alternative to cigarette smoking—particularly for more dependent adult smokers living in that region.

    “When considering laws and regulations governing nicotine concentration in ENDS, policymakers should bear in mind that the availability of a variety of alternative nicotine products may facilitate even more smokers transitioning away from cigarettes,” said Mark Rubinstein, vice president of global scientific affairs at Juul Labs.

  • Juul Labs to Leave Ireland

    Juul Labs to Leave Ireland

    Juul Labs will exit the Irish market at the end of the year after entering the country less than two years ago.

    Facing growing regulatory pressure and scrutiny, Juul Labs in September told its workers that it planned to exit some European and Asia-Pacific markets and sack more of its remaining 2,200 employees.

    “Although much has been achieved in a short space of time, at a global level the company has had to make some difficult decisions about how best to serve its mission,” the company told suppliers in Ireland in recent weeks.

    “As part of this process the company has made the decision to focus its investment on core markets in order to best position itself for the long term, therefore, unfortunately [it has] informed us of [its] intention to exit the Irish market,” it added in a memo seen by the Irish Independent.

    In February, 39 U.S. states launched an investigation into Juul Labs marketing practices, which allegedly targeted minors and misrepresented the levels of nicotine in its products.

    Last month, Altria cut the value if its holding in Juul Labs to less than $5 billion.

    In April, the U.S. Federal Trade Commission (FTC) launched an action seeking to undo Altria’s original investment in Juul. The FTC has alleged that Altria and Juul “entered a series of agreements… that eliminated competition in violation of federal antitrust laws.”

  • Juul Closes South Carolina Plant

    Juul Closes South Carolina Plant

    Juul starter kit
    Photo: Juul

    Juul Labs has shuttered its assembly plant in Lexington County, South Carolina, USA, amid a deteriorating business environment and pushback from local politicians.
     
    “There has been rapid change in the landscape of the vapor category, and these operations are no longer viable,” the company said in a statement to The Post and Courier on Wednesday. “Earlier this summer, we unfortunately had to begin reductions to our manufacturing team.”
     
    In May 2019, Juul announced the new assembly and packaging plant in Lexington County, boosting South Carolina’s economy by about $125 million and creating 500 jobs.
     
    Juul has since suffered a backlash over its marketing practices and heightened restrictions on the vapor business, including flavor bans in many jurisdictions. It has laid off a substantial share of its workforce, discontinued certain products and exited several international markets.

  • Altria Converts its Non-Voting Juul Shares

    Altria Converts its Non-Voting Juul Shares

    Photo: Juul Labs

    Altria Group will convert its non-voting shares in Juul Labs to voting shares, pursuant to its December 2018 investment in the e-cigarette manufacturer.

    “Altria does not currently intend to exercise its additional governance rights obtained upon conversion, including the right to elect directors to Juul’s board, or to vote its Juul shares other than as a passive investor, pending the outcome of the U.S. Federal Trade Commission (FTC) litigation,” Altria stated in a press release.

    In April 2020, the FTC filed an administrative complaint challenging Altria’s minority investment in Juul. Altria believes it has a strong defense and intends to vigorously defend its investment.

    “As previously disclosed, Altria expects to account for its investment in Juul under the fair value option. Under this option, Altria’s consolidated statement of earnings will include any cash dividends received from its investment in Juul as well as any changes in the fair value of the investment, which will be calculated quarterly,” the company wrote. “Altria intends to treat quarterly changes in the fair value of the investment as a special item and exclude those changes from its adjusted diluted earnings per share.”

    In December 2018, Altria made a minority investment in Juul Labs. In exchange for the investment, Altria received a 35 percent economic interest in Juul Labs through non-voting shares, with their conversion to voting shares contingent on antitrust clearance. Under revised agreement terms announced in January 2020, Altria can designate two representatives to Juul’s board of directors.

  • ‘Juul Nicotine Levels Competitive With Cigs’

    ‘Juul Nicotine Levels Competitive With Cigs’

    Photo: Ethan Parsa from Pixabay

    The Juul System may deliver a sufficiently satisfying level nicotine to compete with combustible cigarettes for adult smokers, according to new research.

    Published in the journal Drug and Alcohol Dependence, the clinical study compared the nicotine delivery profile of the Juul System with other nicotine-containing products, including cigarettes, to assess their pharmacokinetic profiles. The study found that while the initial nicotine delivery for the Juul System was similar to that of combustible cigarettes, the maximum and total amount of nicotine delivered was lower than that of combustible cigarettes, on par with another ENDS product, and higher than nicotine gum.

    “When considering laws and regulations governing nicotine, policymakers should bear in mind that providing a similar nicotine effect and experience to combustible cigarettes is critical to facilitate an adult smoker’s transition away from smoking,” said Mark Rubinstein, vice president of science at Juul Labs in a statement. “E-cigarettes have the potential to displace combustible cigarettes, but only if they deliver nicotine at levels to satisfy smokers.”

  • China Shuts Down Juul Counterfeiter

    China Shuts Down Juul Counterfeiter

    Photo: Steveheap – Dreamstime.com

    Chinese federal authorities have shut down a major manufacturer and international distributor of counterfeit Juul devices and pods, Juul Labs announced.

    Following a lengthy investigation last year by Juul Labs’ brand protection team into counterfeit operations in the region, the company identified Shenzhen Kang Erqiang Electronic Technology Co. as a large player in the illicit global trade of counterfeit Juul products.

    Chinese law enforcement subsequently seized 14,600 units of counterfeit Juul products, including counterfeit pods, devices, and packaging. A computer was also seized, which provided authorities with critical information regarding when the illicit operation was launched as well as a rough estimate of counterfeit sales.

    Authorities determined that the counterfeit operation began sometime in 2018, and over a 16-month period, sold roughly $324,000 worth of counterfeit Juul products. The factory operator confessed to his involvement and was sentenced to three years and four months in prison, along with a fine equivalent to $163,487.

    In a statement, Juul said it would continue to fight illegal sales of its products. “These black-market products present additional health and safety risks to adult consumers given that they often are produced in unsanitary conditions without manufacturing and quality controls and lack ingredient testing and product characterization. They also may contain harmful chemicals not present in other, authentic products. Furthermore, sales of counterfeit vapor products undermine underage-prevention measures through ease of access.”

  • Juul Labs Cuts Valuation Again

    Juul Labs Cuts Valuation Again

    Juul starter kit

    Juul Labs has cut its valuation to about $10 billion from $12 billion at the end of last year, reports Reuters.

    Juul was valued at $38 billion in December 2018, when Altria Group took a 35 percent stake in the company.

    The latest write down follows recent decisions to exit certain markets and related restructuring costs, according to the memo sent to Juul employees by chief executive officer K.C. Crosthwaite.

    “Today’s valuation does not surprise me, and I expect other investors to also arrive at lower valuation marks that factor in our recent restructuring,” he reportedly said.

    Juul has faced heightened regulatory scrutiny following a rise in teenage vaping and a ban on the sale of popular flavors.

    In September, the company said it would make a significant cut to its global workforce and explore pulling out of some European and Asia-Pacific markets to save cash.

    Earlier this month, the company announced its exit from Germany.

  • Juul Labs to Exit Germany

    Juul Labs to Exit Germany

    Photo: Juul Labs

    Juul Labs will withdraw from Germany at the end of the year, reports W&V, citing a company spokesman in Hamburg.

    The company said it needed to set priorities in to be successful in the long term. “In this way one can invest in research and development and future products in core markets,” it stated.

    German consumers will be able to purchase Juul products until stocks run out.

    Following a wave of layoffs, Juul’s German subsidiary had only about a dozen employees left, which have now been terminated, as well.

    Juul had already exited Austria this summer and plans to leave Switzerland soon.

    The company, which enjoyed great success in the United States until a regulatory backlash, has found it challenging to crack the European market due to EU limits on nicotine.

    Juul products sold in the EU contain significantly lower doses of nicotine than those on the U.S. market, making it difficult for them to compete against combustible cigarettes in Europe.

    Recently, Juul was also forced to temporarily halt shipments in Germany because its packages were missing a mandatory recycling symbol.

  • More Restructuring and Job Cuts at Juul

    More Restructuring and Job Cuts at Juul

    Photo: Juul Labs

    Juul Labs is planning another major restructuring effort that includes layoffs and cost-cutting, according to reports in The Wall Street Journal and the Pittsburgh Post-Gazette. The e-cigarette maker is also considering halting sales in Europe and Asia, reducing its footprint to its core markets of the U.S., Canada and the U.K.

    “To better serve our mission, we must prioritize how we use our resources to execute on our long-term, focused approach,” the company wrote in a statement.

    It’s the third major shakeup since September as Juul attempts to revamp its strategy in the face of heightened scrutiny of vaping.

    The bulk of the cuts will hit Juul’s marketing department. Juul said it would cut 150 jobs and phase out the position of chief marketing officer, adding to 500 reductions announced in October. In total, the company is slashing 650 jobs, or 15 percent of its global workforce.

    “As the vapor category undergoes a necessary reset, this reorganization will help Juul Labs focus on reducing underage use, investing in scientific research, and creating new technologies while earning a license to operate in the U.S. and around the world,” Juul CEO K.C. Crosthwaite was quoted as saying.

    The company’s future advertising efforts will focus on direct marketing. It’s still enforcing its strategy of avoiding TV, print and online marketing.

    Juul said it will continue to invest in its product team as the company explores new technologies to combat underage use. The company has reportedly submitted to the U.S. Food and Drug Administration a new version of its vaporizer designed to unlock only for users at least 21 years old.

    Juul’s value has deteriorated as concerns mounted about the health risks of vaping and U.S. regulators pushed for a crackdown on e-cigarettes. Juul was also criticized for selling flavored pods that became popular with teens. Altria, which invested $12.8 billion for a 35 percent stake in Juul in 2018, recently wrote down its investment by $4.5 billion.