Juul Shake-up: C.E.O. Steps Down - The New York Times

The chief executive of Juul Labs, the dominant e-cigarette company that has been the target of public and regulatory outrage over the soaring use of teenage vaping, stepped down on Wednesday.

The executive, Kevin Burns, will be replaced by K.C. Crosthwaite, an executive from Altria, the major tobacco company that owns a 35 percent stake in Juul, the San-Francisco-based company.

Juul also said it would not fight the Trump administration’s proposal to ban most flavored e-cigarettes and would end one of its campaigns, “Make the Switch,” which the Food and Drug Administration had criticized as an illegal effort to portray its e-cigarettes as safer than traditional cigarettes.

In addition, Altria and Philip Morris International said on Wednesday that they had ended talks to merge, dashing the chances of reuniting the two arms of what had once been Philip Morris.

The moves were announced in rapid succession during a month of escalating tensions in the marketplace and among regulators, public officials and parents over e-cigarettes and a spate of hundreds of vaping-related illnesses that have spread across the country. Nine deaths have now been linked to the lung ailments, causing public health agencies to warn most people to refrain from vaping either nicotine or THC products. Many of the patients have said that they had been vaping THC, the high-inducing ingredient in cannabis, when they became short of breath and grew sicker, officials have reported.

Within the last week alone, Massachusetts announced a four-month ban on the sale of allvaping products; Walmart said it would stop selling all e-cigarettes and the F.D.A. announced it had opened a criminal inquiry into the supply chain of vaping products and devices.

In the weeks before that, New York and Michigan imposed bans on sales of flavored products and the Trump administration said it would propose a nationwide ban on flavored e-cigarette products, including mint and menthol.

While no one product or ingredient has been blamed for the cause of the illnesses, Juul, as the dominant e-cigarette maker in the United States, has faced declining sales and public backlash over whether it marketed its products to teenagers. On Tuesday, the company said it was restructuring and would consider reducing its 3,800-member workforce.

If the Trump administration does go forward with a ban on most flavored e-cigarettes, Juul officials had estimated that the company’s sales would be reduced by 80 percent initially.

Juul had also planned extensive overseas expansion, but an effort in China failed almost immediately and India last week also said it would ban the sale of e-cigarettes.

In a statement, Philip Morris and Altria said they would instead focus on rolling out the IQOS heated tobacco product in the United States. They emphasized that IQOS, which Philip Morris International sells abroad, is not “an e-vapor product,” unlike Juul’s devices.

Earlier coverage

Massachusetts Orders 4-Month Ban on Sale of All Vaping Products

Sept. 24, 2019