Juul Tried to Position Itself As a Responsible Actor. It Backfired.

Juul Labs Inc. pursued a strategy to win over Washington. But the e-cigarette maker wound up further alienating regulators, helping to thrust the once-soaring startup into a crisis that threatens its business.

Facing scrutiny stemming from surging teen use of its vaporizers, Juul has tried over the past year to position itself as a responsible actor in an industry with few rules. It overhauled its marketing, halted retail-store sales of its fruity flavors that young people favor and introduced a checkout system to curb illegal sales to minors.

But other steps it took backfired and contributed to a perception in Washington that Juul was on the wrong side of a public health crisis.

“I think Juul put the entire category at risk by pursuing top-line growth and market share without a real eye toward what was going on and who was using them,” said Scott Gottlieb, who as federal Food and Drug Administration commissioner clashed with the startup last year.

The company flooded the White House with lobbyists and other advocates, making it appear that it was bypassing the FDA, which irked officials in the agency and some in the administration, according to people familiar with the discussions.

Juul launched an anti-vaping program for schools despite warnings that the effort was reminiscent of one by major tobacco companies years ago that seemed aimed more at luring new smokers than dissuading them. And it made unauthorized claims to children and adults that its products were safer than cigarettes, the FDA concluded, prompting a formal rebuke from the agency…..[Read More]