michael barbaro

From The New York Times, I’m Michael Barbaro. This is “The Daily.” Today: From the moment that Juul was created, it told federal regulators that its product would save lives. Those regulators were eager to believe it. Part 2 in our series on the promise and the peril of vaping. It’s Wednesday, October 30. Sheila, where does the story of Juul begin?

sheila kaplan

The story starts in around 2007, on the beautiful palm tree-lined campus of Stanford University, where two design students, James Monsees and Adam Bowen, are trying to figure out how to stop smoking.

michael barbaro

Sheila Kaplan has been investigating Juul for The Times.

sheila kaplan

The problem is that products that are available for smokers to quit — the nicotine patch or gum — often don’t work. A lot of smokers don’t like them. So they wanted to come up with a new alternative for health-conscious smokers.

[music]

sheila kaplan

And they came up with this very slick new e-cigarette. And it’s basically a heating unit. And you add in a liquid nicotine flavor pod into the unit. And when it’s heated, it gives off a vapor that you can draw into your lungs and get your nicotine fix.

michael barbaro

Mm-hmm. Hence the term vape.

sheila kaplan

Yes. And it’s very small. It looks like a flash drive. You charge it up on your computer. It’s tiny. It’s portable. It looked like it was designed by Apple. They wanted their product to disrupt the industry. And in 2017, after a few fits and starts, they launched Juul Labs.

michael barbaro

So their target audience is, kind of like themselves, smokers who want to quit.

sheila kaplan

Right. But they can’t say that on the box. And the reason they can’t is because the F.D.A. doesn’t permit them to make health claims for the product yet. Juul hasn’t been studied by the F.D.A. Juul hasn’t submitted evidence yet to show that it’s safer than cigarettes. And until then, Juul has to be very, very careful about its wording. Juul can’t make claims that the product will help people quit. It’s not approved as a smoking cessation device. They can’t even say that it’s safer, although they imply it. But the F.D.A. seemed very excited about Juul and the other e-cigarettes. And in July of 2017, they said they were going to give Juul and the other companies five extra years to prove their health claims. In the meantime, the F.D.A. allows them all to stay in the stores. So there’s a sense that the agency has been very friendly to the vaping industry.

michael barbaro

And Sheila, what did that suggest to you?

sheila kaplan

I think they looked at the product and thought, we still have questions about how it will work. But for the first time, there was a product that smokers might actually enjoy instead of smoking.

michael barbaro

And if you’re the F.D.A., that seems like a pretty good thing.

sheila kaplan

Yeah. If you’re the F.D.A., that’s great news. The F.D.A. says again and again that smoking cigarettes is the greatest preventable cause of death in the U.S. And they have been trying so many different things to try to get people to stop. And this was something that even looked a little glamorous. Maybe it would work.

michael barbaro

So with this implicit support of the F.D.A., I assume that Juul is leaping headlong into this market of smokers who want to quit.

sheila kaplan

Well, no, actually. Publicly, Juul is saying that they wanted to be an alternative for smokers. But the advertising and the social media is really all about how cool Juul is.

michael barbaro

And what does that effort look like?

sheila kaplan

Well, Juul takes on a very creative Silicon Valley-like ad campaign, ads that had attractive young people vaping in glamorous settings, at the beach, at concerts. They have influencers on Instagram and Facebook who were beautiful and in love and vaping together. Juul gets movie stars to vape their products.

archived recording (dave chappelle) Oh, my vape pen?

sheila kaplan

You’ve got Dave Chappelle —

archived recording (dave chappelle) You want to hit my vape pen? [CHEERING]

sheila kaplan

Awkwafina —

archived recording (awkwafina) I found out about Juul very early in the process.

sheila kaplan

Leonardo DiCaprio —

archived recording At this year’s Golden Globes, Leonardo DiCaprio was spotted vaping.

sheila kaplan

But beyond that, Juul is trying to develop word of mouth. So they go around all over California — they have this overnight pajama party in a Hollywood cemetery where they give everybody free Juuls.

michael barbaro

Cemetery?

sheila kaplan

Yeah, yeah. I’m not sure I understand the symbolism there. [LAUGHTER] But none of these ads talk about quitting. The movie stars who were photographed vaping just look extremely cool.

michael barbaro

So how does all of this marketing work for Juul?

sheila kaplan

It worked great. They went from being a company nobody had heard of, selling a product nobody even knew there was a market for, to owning the entire category. They went from $200 million in sales in 2017 to $1.3 billion the following year.

michael barbaro

Wow.

sheila kaplan

The product became another word for vaping, because people say “Juuling.”

michael barbaro

So without question, they’re the number one vaping company out there?

sheila kaplan

Yes, but that’s really just a small part of the story.

archived recording 1 What’s up, guys? As you can see in the title, we’re going to be doing a review on the Juul. archived recording 2 This is a super popular vape. And we’re just going to take some rips. We’re going to get some nice nicotine buzz going. archived recording 3 Yo. Welcome back to another video. Today, I’m going to tell you how to sneak your Juul to school.

sheila kaplan

It was around then, in the summer of 2018, that lots of reporters were coming over to me and saying that their kids were using this new, teeny little device called a Juul. And what on earth is it? And should we be worried?

michael barbaro

And what did you say?

sheila kaplan

I said I had no idea, but I would look into it. And then, all of a sudden, in September 2018, this big bomb drops for Juul.

archived recording Well, there’s a new federal survey based on —

sheila kaplan

The F.D.A. releases its annual teen smoking survey.

archived recording Twice as many high school students are using e-cigarettes compared to last year. It is the biggest one-year increase in the 44-year history of that study.

sheila kaplan

And most of the teens vaping are kids who never smoked cigarettes.

archived recording The F.D.A. says there were 2 million middle school- and high school-aged students using e-cigarettes last year. And it’s estimated Juul has about 70 percent of the market share.

sheila kaplan

And most of the teens were using Juul.

michael barbaro

Hmm. And the question, of course, is what makes Juul so appealing to kids?

sheila kaplan

Well, it seems that it’s a cool new thing. It’s kind of expensive. So it becomes sort of a status symbol to have one. And beyond that, it comes in kid-friendly flavors.

michael barbaro

Like what?

sheila kaplan

Mango, watermelon, crème brûlée and menthol, among others.

michael barbaro

And when you say kid-friendly, the assumption here is that an older person trying to quit smoking is not going to be vaping with crème brûlée-flavored Juuls?

sheila kaplan

Well, that’s what most of the public health advocates say. To be fair, Juul says that older people who are trying to quit do like the dessert flavors and the fruit flavors. But they are also very, very appealing to kids. And so the F.D.A., which had been a friend to Juul and had given Juul and the other e-cigarette makers more time to establish themselves before being regulated, realizes they have made an enormous mistake. And the F.D.A. very quickly decided they had to take action. They went to Juul and said, O.K., guys, you’ve got 30 days to show us a plan explaining how on earth you’re going to keep the products away from kids. If you can’t do that, we’re going to take you off the market. For Juul, this is an extinction-level event.

archived recording In the face of massive government pressure, e-cigarette company Juul will no longer sell some of its product on store shelves.

sheila kaplan

First, Juul announces that they’re going to take their flavored pods out of stores and limit their sales only to online purchases with strict age verification.

archived recording The company has long maintained they launched the flavors to help adults switch from regular cigarettes and don’t want kids to use their product.

sheila kaplan

They didn’t change the flavors, but they changed the names. So fruit punch became fruit. Crème brûlée became crème. Cool cucumber lost its coolness and just became cucumber. And they promised not to use young people, or those who looked young, in their ads. And finally, they launched this ad campaign: Make the switch.

archived recording My name is Stacy. I’m 52 years old.

sheila kaplan

It features testimonials from smokers who have quit —

archived recording I was a pack-a-day smoker for 33 years.

sheila kaplan

— and how much better they feel.

archived recording I really took a hit from people’s reactions to the fact that I was a smoker. Since I switched to Juul —

sheila kaplan

They are just trying to position themselves as a product now strictly for smokers who want to switch.

archived recording It’s like a weight lifted off of you.

michael barbaro

This sounds like the genuine reaction of a company pretty freaked out about the consequences of not meeting the F.D.A.‘s requirements here, either because they might go out of business or because they are genuinely alarmed by the patterns that they’re seeing out there — or, I guess, a combination of the two.

sheila kaplan

Yes. But it turns out that they also had this other motivation. They were trying to sell a huge chunk of their business to, of all people, a tobacco company. Not just any tobacco company, but Altria, the parent company of Philip Morris, the folks who brought you the Marlboro Man, the folks who they had said were their enemy. They touted themselves as the anti-tobacco company. And it turns out that while they were making their public relations campaign to stave off F.D.A. action, they were secretly talking to the tobacco companies.

[music]

sheila kaplan

I happened to have been talking to a Juul consultant when the rumor came out that Juul was in discussions with Altria. And the consultant was stunned and said, oh, boy. How are we going to deal with this?

michael barbaro

We’ll be right back. Sheila, from everything you’ve said, Juul’s founders got into the e-cigarette business because they wanted to help people quit smoking cigarettes. So why would they want to enter into a partnership with Altria, one of the biggest cigarette brands in the world?

sheila kaplan

Altria has a lot of money and a lot of savvy. You have to remember Juul was in tremendous trouble at this point. I think Juul thought, well, public opinion about us can’t get any lower. So why not connect with Altria? Take their money, take their expertise, take their lobbyists, and then try to build up from there?

michael barbaro

So Sheila, what happens with this deal?

sheila kaplan

In December 2018, Altria purchased a 35 percent stake in Juul —

archived recording Altria, the company that owns Marlboro, is investing nearly $13 billion into Juul —

sheila kaplan

— for nearly $13 billion.

michael barbaro

That’s a lot of money.

sheila kaplan

It’s a lot of money. And Juul immediately used much of it to give bonuses to its employees —

archived recording The investment makes two Stanford students who created Juul multibillionaires and will reportedly pay its 1,500 employees a bonus of more than $1 million each.

sheila kaplan

— thereby making sure that people who did not want to work for a tobacco company thought twice before leaving.

michael barbaro

And what does this deal end up meaning for Juul as a business?

sheila kaplan

Well, they’re still in a lot of trouble with the F.D.A. But now they have Altria’s political clout to help them. And Juul’s sales are up. So they’re doing very well in the marketplace. But what they didn’t expect, and what nobody expected, was —

archived recording A medical mystery spreading across the country tonight.

sheila kaplan

— all over the country, people would start getting very sick.

[music]

sheila kaplan

It started in the late spring.

archived recording The Minnesota Department of Health has issued an alert after four teenagers got seriously ill.

sheila kaplan

The first reports came out of the Midwest.

archived recording One hospital in Wisconsin reported it has seen eight teenagers with seriously damaged lungs and —

sheila kaplan

Mostly young people being rushed to the hospital, unable to breathe.

archived recording — presented with shortness of breath, with cough, with fever.

sheila kaplan

Quite a few of them, within 24 hours, could barely breathe at all. And they were put on ventilators.

archived recording — some of which have been hospitalized in our intensive care unit and have required significant therapy to help them breathe.

sheila kaplan

It was horrible.

archived recording They go from healthy adolescents to really in a life-threatening situation.

sheila kaplan

Pretty quickly, within about six weeks —

archived recording The C.D.C. is looking into dozens of cases. The C.D.C. can confirm 31 cases — 200 potential cases — 380 cases — The 450 cases spanned 33 states.

sheila kaplan

There are hundreds and hundreds of cases around the country. And then —

archived recording An adult in Illinois died from an unexplained pulmonary illness.

sheila kaplan

— people started to die.

archived recording 1 A fourth death has been reported from a severe lung illness. archived recording 2 That brings to six the total number of deaths across the United States. archived recording 3 As the mystery deepens, the search for answers continues.

michael barbaro

And nobody knew what was causing it. The doctors were baffled why young, otherwise healthy people were getting so sick. Is it an infectious disease? Is it some weird virus they had never heard of? And then what some of the doctors realized was that the one thing all the patients had in common —

archived recordings [INTERPOSING VOICES] Vaping.

sheila kaplan

— they had all been vaping. But what complicated the situation and made it more of a mystery is that everybody seemed to be vaping something different. And in Washington, some of the pro-vaping groups, with the exception of Juul, are saying, you know what? Everybody’s who’s sick has been vaping pot. This is not nicotine. Nicotine vaping is safe. It’s not our products.

michael barbaro

And why doesn’t Juul join in making that claim?

sheila kaplan

Because at this point, Juul is already in so much trouble that while they are pretty confident that their products aren’t hurting people, they really don’t know. Juul is just trying to be super cautious at this point. And that turns out to be a pretty smart move, because even though most of the cases seem to be associated with vaping pot, there are a number of cases where people got sick and even died.

archived recording (dulcia steffen) He wasn’t breathing very often. And his last breath I could tell because there was just a slight twitch in his neck.

sheila kaplan

And their survivors say they only vaped nicotine.

archived recording (julie bosman) Do you know which brand? archived recording (kathleen fimple) Mistics. archived recording (dulcia steffen) Then he had blu, and then he went to Juul. archived recording (kathleen fimple) And he only went to Juul less than a year ago.

michael barbaro

So what does Juul do as suspicion starts to grow that perhaps the business that they are in may be making people sick?

sheila kaplan

Well, for once, Juul tries to get out front of a problem.

archived recording Only on CBS This Morning, the C.E.O. of Juul Labs is defending his company’s reputation.

sheila kaplan

The C.E.O., Kevin Burns, goes on national TV and tells people he believes that Juul does not present a risk.

archived recording (kevin burns) We think we have a product that does not present a risk based on the guidelines of the category today to the American public.

sheila kaplan

But he also says that the long-term effects are not known.

archived recording (kevin burns) That’s true. That’s a true statement.

sheila kaplan

And then he really surprises listeners by saying —

archived recording (kevin burns) Don’t vape. Don’t use Juul.

sheila kaplan

Don’t use Juul if you’re not a smoker.

archived recording (kevin burns) Don’t start using nicotine if you don’t have a pre-existing relationship with nicotine. Don’t use the product.

michael barbaro

Wow. So what ends up happening?

sheila kaplan

In early September, C.D.C. makes a public announcement.

archived recording The C.D.C. and several medical groups now warning the public to stop vaping immediately.

sheila kaplan

Everybody should stop vaping while we’re figuring this out. And then something else happens, which is that the new numbers come in from the Youth Tobacco Survey. And youth vaping is continuing to rise.

archived recording The most recent data from the National Youth Tobacco Survey showed that 27 and a half percent of youths reported using e-cigarettes, compared with 20.8 in 2018.

sheila kaplan

Now it’s up to 5 million teens who say they’ve vaped recently. So you’ve got this outbreak of a lung illness. And then in the midst of that, more kids are using e-cigarettes than ever. So —

archived recording (donald trump) We have a problem in our country. It’s a new problem. It’s a problem nobody really thought about too much —

sheila kaplan

President Trump makes this announcement.

archived recording (donald trump) — a few years ago. And it’s called vaping, especially vaping as it pertains to innocent children. And they’re coming home, and they’re saying, Mom, I want to vape.

sheila kaplan

Next to him is the secretary of health and human services, Alex Azar.

archived recording (alex azar) The Food and Drug Administration intends to require that all flavors other than tobacco flavor would be removed from the market.

sheila kaplan

And he says, we are going to ban all flavored e-cigarettes.

michael barbaro

Which are the most popular among young people.

sheila kaplan

Right, and which makes up about 80 percent of Juul’s sales.

michael barbaro

So this feels like yet another pretty much existential crisis for Juul. How do they respond to it?

sheila kaplan

Juul stops pretending things are O.K.

archived recording Juul Labs U.S.A. announced there will be no more ads.

sheila kaplan

They stop all their ads. And they kick out their C.E.O.

archived recording Juul announced a new C.E.O., a former tobacco executive.

sheila kaplan

And they replace him with a more experienced tobacco executive straight from Altria. They’re now doing everything they can, because they know that at any time, given everything that’s happened, the government could yank them off the shelves and say, game over.

michael barbaro

Just basically ban the sale of any Juul anywhere.

sheila kaplan

Right. That’s their fear. Juul is waiting to learn if health officials will say that their product has contributed to this horrible lung disease outbreak. And they’re also waiting to see if the F.D.A. will let them stay on the market, given the growing number of kids who are vaping their product.

michael barbaro

If Juul’s products, Sheila, eventually are pulled from the shelves, I wonder where that leaves these millions of people who took up vaping. Maybe they gave up smoking to use Juul, or they picked up Juul having never smoked and are now very much dependent on it. What happens to them? What do they do?

sheila kaplan

Well, some of the industry analysts do predict that there will be a mass shifting to regular old cancer-causing cigarettes.

michael barbaro

That would be a very perverse outcome of this experiment in creating an entire industry that was supposed to get people to stop smoking.

sheila kaplan

Yeah. But guess who would be totally fine with that? Altria, which spent $13 billion for a stake in Juul. Because guess what their main business still is? Cigarettes.

[music]

michael barbaro

Sheila, looking back at all this, the story that you have just told us, it’s hard not to think about how federal regulators approached Juul from the start. Did regulators just behave too credulously here? Were they too willing to buy into Juul’s story of itself and not do enough of their own due diligence?

sheila kaplan

It does seem that, in retrospect, the regulators were fooled. They really wanted to offer the public an alternative to smoking. Smoking is still the biggest public health problem in the country. And I know that the folks at the F.D.A. believe that if they could offer safer alternatives, they could save lives. This could be the biggest public health gain ever in the U.S. And it does seem that they didn’t ask enough questions, that they were too quick to believe what they wanted to believe, that innovation could solve this intractable problem. And if you talk to them now, they know they were wrong. And it’s very sad.

michael barbaro

Sheila, thank you very much. We appreciate it.

sheila kaplan

My pleasure.

michael barbaro

We’ll be right back. Here’s what else you need to know today. On Tuesday, the National Security Council’s top expert on Ukraine, Lieutenant Colonel Alexander Vindman, told House impeachment investigators that the White House transcript of the call between President Trump and the president of Ukraine omitted crucial words and phrases, and that his attempts to restore them had failed. The omissions included references to former Vice President Joe Biden and to the Ukrainian company that employed Biden’s son, raising more questions about how records of the call were handled by the White House. That call has since become central to the impeachment inquiry. And —

archived recording (richard blumenthal) Boeing came to my office shortly after these crashes and said they were the result of pilot error. Those pilots never had a chance. These loved ones never had a chance. They were in flying coffins as a result of Boeing deciding that it was going to conceal MCAS from the pilot.

michael barbaro

During a tense congressional hearing, senators demanded an explanation from the chief executive of Boeing about the company’s handling of flight control software blamed for two crashes that killed 346 passengers. The chief executive, Dennis Muilenburg, acknowledged that he learned about pilots’ concerns about the software, known as MCAS, after the first crash, but did not take action until after a second crash involving the same software.

archived recording (dennis muilenburg) On behalf of myself and the Boeing company, we are sorry — deeply and truly sorry. As a husband and father myself, I’m heartbroken by your losses. I think about you and your loved ones every day, and I know our entire Boeing team does as well.

michael barbaro