Juul Announces That CEO Kevin Burns Has Stepped Down
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Juul on Wednesday said CEO Kevin Burns had stepped down and that K.C. Crosthwaite, an Altria executive, would take over, effective immediately.
The $38 billion company, which is partly owned by the tobacco giant Altria, said it would be "suspending all broadcast, print and digital product advertising in the US" and "refraining from lobbying the administration on its draft guidance and committing to fully support and comply with the final policy when effective."
The personnel change came a day after The Wall Street Journal reported that California federal prosecutors had launched a criminal investigation into Juul.
The company is also the subject of investigations by the Federal Trade Commission, the Food and Drug Administration, and several state attorneys general. The FTC is looking into whether Juul used social-media influencers and forms of marketing to pitch its product to minors, while the FDA is considering several issues, including the high nicotine content of Juul's e-cig pods.
Walmart said last week that it would end sales of e-cig products, and the Trump administration announced this month that it planned to ban most flavored e-cigs after reports of several deaths linked to vaping.
"We can't allow people to get sick," President Donald Trump told reporters. "And we can't have our kids be so affected."
And Business Insider reported earlier this month that the FDA criticized Juul as portraying its e-cigs as "totally safe" while it marketed them to young people.
The FDA told Juul in a September 9 warning letter that referring to its vaping products "as '99% safer' than cigarettes, 'much safer' than cigarettes, 'totally safe,' and 'a safer alternative than smoking cigarettes' is particularly concerning because these statements were made directly to children in school."
As Altria's chief growth officer, Crosthwaite "oversaw the company's expansion into alternatives to combustible cigarettes and played a key role in the commercial and regulatory efforts related to the US launch of IQOS," a tobacco-heating system for vaping devices, Juul said. He was also "an observer on Juul Labs' board of directors."
"In his new role, Crosthwaite and the entire Juul Labs leadership team will continue a broad review of the company's practices and policies to ensure alignment with its aim of responsible leadership within the industry," the company said.
In an interview with CBS in August, Burns warned against the use of Juul's products, saying that anyone not already using nicotine should not use Juul products because of the addictive nature of the drug.
"Don't vape. Don't use Juul," Burns told CBS's Tony Dokoupil, adding, "Don't start using nicotine if you don't have a preexisting relationship with nicotine."