The Vapes of Wrath

0:00Support for NPR and the following message come from Edward Jones. What does it mean to live a rich life? Maybe it's full of brave first leaps, tearful goodbyes, and everything in between. And with over 100 years of experience, your Edward Jones financial advisor can help. Edward Jones, member SIPC. This is Planet Money from NPR. Where does this whole story begin? So our story begins in November of 2019 at the White House, where President Donald Trump has become concerned about youth vaping. This is journalist Leon Nafok. For the past year or so, he's been looking into the rise of e-cigarettes over the last couple of decades.

0:45And that story centers on one device in particular, the Juul. So Juul is a sleek little USB-type device that became essentially the first mainstream vape. But at the time of this White House meeting back in 2019, the Juul was seen by a lot of people as this massive threat to public health. The numbers around teen use of Juul in particular are skyrocketing. Everyone thought the war on youth smoking was over. Those numbers have been going down and down and down. But here comes this new technology, this new device, the jewel that kids seem to love. And so Trump decides to invite a whole bunch of stakeholders, people from parent groups, people from industry, to have basically a apprentice style gathering to hash it out.

1:39OK, so this is like the reality TV approach to public health policy. Yeah. So, I mean, you get the impression that Trump thought that by just simply getting everyone in a room and having them argue about it, he would see the path forward. He would see the obvious solution that all these other people had not been able to find. Well, this is a very big subject and it's a very complex subject, probably a little bit less complex than some people think. But I'm here to listen and I have very divergent views. Who would like to start? As different people around the table respond to President Trump, the fault lines in this debate start to become clear.

2:20Broadly speaking, there are two factions. One side says that vaping is a scourge on society that's getting an entire new generation of kids addicted to nicotine. And we need to do whatever we can to get these things out of stores and out of kids' hands. And I've never seen an epidemic this serious, this rapid, and this intense among our youth. And then on the other side, you have a faction that says, OK, yes, youth vaping is a problem. But we also got to think about all these millions of smokers who are going to die if they don't quit. And vaping has been shown to be a really effective way to quit smoking.

2:57So for these folks, which includes a lot of public health experts, vaping is an imperfect solution to a really, really deadly problem. But pretty quickly, the meeting goes from the usual introductions and pleasantries to a series of disagreements over some of the most basic facts of the situation, like how many teens are actually taking up vaping. I'm currently using five million as a misrepresentation, and I'm not trying to show you a lot. numbers are a misrecognito. No, five million is ever tried. There's basically an exchange of accusations that both sides are not being honest about the problem.

3:31And it gets really personal really fast. Yeah, the meeting eventually devolves into an outright screaming match. I'm sorry, but that's a false step. I'm sorry, but that is a completely false step. Utah's a Mormon state. Utah's a Mormon state. Half the kids in high school are big. It's not a very productive meeting. People are just like shouting over each other and you can't even really hear what everybody's saying. So Trump has to kind of just put a stop to it after about an hour. And he is clearly a little bit sobered by what he has seen and his hope of making a complex subject. Less complex has not worked.

4:08We want to take care of our kids. Got to take care of our kids. Thank you very much. When you zoom out, this meeting at the White House feels like a kind of key to understanding the broader story of how e-cigarettes came crashing into our lives. I mean, I think what you see in that chaotic meeting is it's a microcosm of the debate we've been having ever since vaping took off. And ever since this thing that was supposed to solve one public health problem has seemingly spawned a whole other one. Hello and welcome to Planet Money. I'm Alexi Horowitz-Gazi. And I'm Leon Nafok. I am the co-host, along with journalist Ariel Pardes, of a new podcast called Backfired, The Vaping Wars.

4:51Today on the show, the parable of the jewel. How a new technology ignited a public health crisis, and how the government's efforts to rein it in may have actually made things worse. This message comes from Vanguard. Capturing value in the bond market is not easy. That's why Vanguard offers a suite of over 80 institutional quality bond funds, actively managed by a 200-person global team of sector specialists, analysts, and traders. They're designed for financial advisors looking to give their clients consistent results year in and year out. See the record at Vanguard.com slash audio. That's Vanguard.com slash audio.

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6:14Just a few clicks can tailor your tone and writing so you come across exactly as you intend. Get time back to focus on your high-impact work. Download Grammarly for free at grammarly.com slash podcast. That's grammarly.com slash podcast. Okay, so the Juul was not the first attempt to create an electronic cigarette. Companies had been experimenting with the idea for decades by the time Juul hit the market. But the rise of Juul helps explain how this technology went from a niche product to a mainstream industry worth tens of billions of dollars. And like a lot of tech companies, Juul got its start in Silicon Valley.

6:51Yeah, so the story of Juul begins on the campus of Stanford University, where two design students, James Montseys and Adam Bowen, both smokers, decide to make their thesis project a prototype of an e-cigarette, a device that will satisfy their cravings as smokers and satisfy the social components of smoking without killing them. We just kind of looked at each other and thought, you know, this would be a really interesting space to look at. So our goal was to basically create a whole new experience for people that retains the positive aspects of smoking, like the ritual and everything, but makes it as healthy and socially acceptable as possible.

7:34How explicit was the kind of like public health part of the mission in their pitch? I think it was genuinely core to what they wanted to do. I mean, I'm not saying that they were altruists who merely wanted to save lives. They also wanted to make money doing it. But I think they saw a huge opportunity when they looked at the massive population of smokers who actively wanted to quit and who weren't able to quit using the smoking cessation tools that were out there. That was very much part of the pitch to investors. From the beginning, Monsies talked about that population as both a group of people that he wanted to help, but also a group of people that, you know, Juul could make a lot of money on.

8:13So that is the origin story of Juul. But one of the key factors in how the company was able to become a cultural phenomenon has to do with how e-cigarettes were regulated when James Montes and Adam Bowen were building their company. The regulatory system that Juul walked into was very murky. There wasn't really anyone they had to answer to. See, back in the 1990s, attorneys general from states across the country had sued big tobacco companies. And the settlements they won against big tobacco, along with later legislation, meant those companies were limited in how they could advertise or what kinds of flavored products they could sell.

8:50But those rules did not explicitly apply to e-cigarette companies. So the FDA had tried to regulate e-cigarettes before Juul came along. There was like an earlier company called Enjoy, still around. And Enjoy wanted to advertise, and the FDA tried to block them by characterizing the Enjoy as a drug delivery device. Enjoy sued the FDA and basically took the position that they were no more a drug delivery device than regular cigarettes. And given that the FDA at the time couldn't regulate cigarettes either, they had no standing to tell Enjoy what to do. — Congress did pass a law in 2009 giving the FDA authority to regulate tobacco products like cigarettes.

9:34But it still took several years before they were able to bring e-cigarettes into that category, which meant that when Juul first hit the market in 2015, the company was operating in a kind of legal gray area. — So the lack of regulations around e-cigarettes meant that Juul was free to do a number of things that you would be really shocked by if it was a tobacco company. From the very beginning, Juul knew that flavored vape liquid was going to be key to making people want their product. So they had flavors like mango and cool cucumber. Again, not something that tobacco companies could offer. And secondly, and this is really important, they were able to advertise.

10:12And as anyone who remembers the fight over the Marlboro Man or Joe Camel would remember, tobacco companies had their hands really tied when it came to presenting their product in a positive light and making people want to smoke Marlboros by showing them a cool cowboy. Juul wasn't bound by that. And what exactly did Juul do with this freedom they had to advertise? They try to make Juul look cool. They try to make their product look really attractive through marketing. They launch a campaign they call Vaporized. They put a big billboard in Times Square. They put a print ad in Vice. And, you know, they threw parties in cities where they thought they could reach cool young people who would then tell their friends about this cool new device.

11:01One of those cool young people was a woman in New York City named Tabby Wakefield or Tabby Wakes. This is like the start of viral marketing. Like, I didn't know what I was doing, but this is what I was doing, I guess. Tabby Wakes was someone who threw parties around the city. You know, she was just out of high school. and someone, you know, who knew someone who knew Tabby invited her to the Juul event in New York and told her to bring all her friends. I think she got paid 200 bucks to, you know, basically avail her social network of this party. And once she got to the Juul party, she, you know, was given samples of their products.

11:38They had little bowls filled with pots. So you could take a handful of creme brulee and just dip. Mint was good and tobacco was good and fruit punch was trash. And what she told us was that she brought her vapes back to college and her friends brought their vapes back to college. We had a bunch of jewels. So it's like your friend comes in your dorm and is like, pass me that thing you were smoking. You're like, here, you can have one. And I think as we say in the show, this was like viral marketing as God intended it. Like they told their friends and their friends told their friends. And suddenly this weird little USB stick was an object to be coveted, something to ask for at a party.

12:17Now, there was pushback against the vaporized campaign. It reminded people of Joe Camel and the slick tobacco advertising in the past. So Juul changed the direction of their advertising. And growth was slow at first. But a year or so after they launched, Juul's sales start to take off. Blue craze and e-cigarettes. It's called Juul, and it is flying off the shelves. One store owner we spoke to says sometimes he sells out in one day. So between 2016 and 2017, you see their sales increase by sevenfold from 2 million units sold in 2016 to 16 million in 2017. And, you know, I just remember that suddenly they were everywhere.

12:58I mean, walking on the street, you saw people jeweling. You know, celebrities were starting to be caught with jewels. You know, the word jewel becomes a verb. That's how you know you're winning is when people say jeweling instead of instead of whatever else, vaping. And it's around this time that a lot of people start to notice that while Juul's target audience may be adult smokers looking to quit, the company's rising popularity is also being driven by teenagers. I mean, I remember walking down the street on my way to work and seeing high school kids standing around vaping. And those same kids would keep vaping when they got to school.

13:34You know, they were vaping in the bathrooms. They were vaping in class. But you could also go on YouTube and you could see kids talking about how they get away with juuling at school. I'm going to go over a couple different ways to hit your juul while you're in school and not get caught. Giving people advice on how to pack your juul into your socks or how to exhale the vapor into your sweater so that no one can see it or smell it. And that brought a whole new kind of attention on juul. In just a couple years on the market, Juul had gone from total obscurity to being a fixture of teen life, flooding into homerooms and study halls across the country.

14:13Which brings us to the next part of the story, the backlash. This is when parents and anti-tobacco activists started calling for government action. And the thing that really pushed government regulators to act was a survey. So the real thunderclap was the CDC's annual youth tobacco survey, which they've been administering for years. And so the early results from this survey hit the desk of a man named Mitch Seller, who had been put in charge of the FDA's efforts to regulate cigarettes. The s*** hit the fan in 2018 when we saw the explosion in the rise of kids' use of e-cigarettes from 2017 to 2018.

14:52It turned out to be a 76 % increase in kids' use of e-cigarettes in one year. So I looked at these numbers in shock. So Zeller just rang the alarm. He brought the results of the youth tobacco survey straight to the FDA commissioner at the time, Scott Gottlieb. And Gottlieb, you know, had the same reaction. And he goes out in public and he calls this an epidemic. The FDA will not tolerate a whole generation of young people becoming addicted to nicotine as a tradeoff for enabling adults to have unfettered access to these same products. And from the beginning, the theory of the case was that the reason kids are flocking to these products and to Juul specifically was flavors.

15:40Kids love flavors. Kids love candy. They are curious about a mango flavored USB stick. And so the number one priority became getting rid of flavored e-cigarettes. And faced with the threat of a crackdown from the FDA, Juul decides to voluntarily withdraw most of its flavors from retail stores. They announce they're going to take those mango and fruit and cucumber Juul pods and only sell them online, where they can use an age verification tool. It seems like they're on board and by all appearances, like they are cooperating with the FDA. And then the FDA finds out about something along with the rest of the world that really shocks them.

16:21Altria is taking an almost$13 billion step towards making sure its business model doesn't go up in smoke. Juul is taking on a massive investment from Altria, which is the company formerly known as Philip Morris and the company that makes Marlboros. Altria says that its investment will boost Juul's value to$38 billion, making it more valuable than Ford, Delta Airlines or Target. Boy, big nicotine entering Juul. That's a scary thing for parents that have no idea how to contain this issue. All of a sudden, you're looking at a very different situation where a company whose existence was premised on destroying a company like Philip Morris and putting them out of business was now taking their money and essentially getting into bed with them.

17:08And this decision only seems to raise more outrage and more concern among regulators. And so even with this huge new infusion of money, the company becomes more embattled than ever. Yeah, this was definitely Jules' worst year. I mean, first, James Monsey is the co-founder, is dragged in front of Congress and faces extremely hostile questions from politicians who see him as a drug pusher. You, sir, you don't ask for permission. you ask for forgiveness. You're nothing but a marketer of a poison, and your target has been young people. And then almost at the same time as this hearing takes place, people start dying of something that people think is connected to vaping.

17:52That's kind of all we knew for a while. We have been reporting heavily recently on vaping and the growing health concerns. Last week, we learned there are now five deaths being reported on it or blamed on it. Indiana, Minnesota, and California each reported a vaping-related death on Friday. Eventually, it was determined that the majority of these cases were linked to a kind of oil used in THC vapes, not mass-market nicotine vapes like Juul. But at the time, no one knew what was causing this mysterious vaping illness, and it got a ton of media coverage, which eventually reached President Trump.

18:29And so Trump is starting to hear about vaping from various people, including Melania, who's worried about their son, Barron, at school. And Trump decides that he needs to do something about it. We have a problem in our country. It's a new problem. 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. So Trump calls in Health and Human Services Secretary Alex Azar. He calls in the acting commissioner of the FDA. They have a press conference. Make it clear that they are going after flavors, that flavors are the main way they see dealing with the teen problem.

19:08So with the president's support, the Food and Drug Administration intends to finalize a guidance document that would commence enforcement to require that all flavors other than tobacco flavor would be removed from the market. Okay, so they announced what sounds like kind of a definitive plan here, just get rid of these flavors. But it turns out to be a bit more complicated, right? Like, what happens to that idea? Well, what happens to that idea is that it turns out not everyone likes it. It turns out that there is, in fact, a constituency of people out there who are adults who vote and who like their flavored vapes.

19:54There are people who have quit smoking using flavored vapes. There are people for whom it has become part of their lifestyle. And Trump is sort of taken aback when he starts getting concerted pushback from this voting bloc who actually might be important to Trump's reelection. They live in swing states like Michigan. There's a survey that Trump becomes aware of. His advisors show it to him that says that 83 percent of people who vape would become single issue voters, basically, if their ability to vape was threatened by whatever the FDA had in store. And what seemed like a really easy win, you know, who doesn't want to prevent kids from becoming addicted to nicotine, suddenly starts to look like kind of a headache because it turns out there's another side of the story.

20:35And this kind of brings us back to that White House meeting that we talked about at the beginning of the show, right? Yes. So part of his sort of attempt to think through this issue, that's when Trump invites everybody he can think of who cares about vaping to come to the White House and argue about it.

20:54After this meeting, it takes the Trump administration a little over a month before they announce where they've actually landed on this question. And in the end, the FDA's new policy does put a ban on vape flavors, just in a very particular way. The flavor ban, you know, spiritually sounds exactly what they've been talking about. But in the way that the policy is actually written, they leave open a huge loophole by limiting their policy to what they describe as cartridge-based devices. So in other words, a device like Juul, where you buy the thing itself, but then separately you buy pods that can come in mango or cucumber or whatever, you can't do that anymore.

21:37Can't have flavored pods, can't have flavored cartridges. It really just is aimed at Juul. The Trump administration had decided to kind of split the difference between the main factions in this debate. They were essentially trying to stop the most popular device from selling the flavors that teens craved. Yet they were still allowing some flavors to appease the adult vapors who'd organized against an outright flavor ban. But this solution struck some public health officials as a recipe for more problems, including Mitch Zeller, who was in charge of regulating tobacco products at the FDA. The White House made this decision.

22:13I received a phone call from a political person at FDA telling me what the policy was going to be as decided by the White House. And I said, well, if that's what you're telling me to do, we will write that guidance. But I just got to tell you from a public health perspective, this is not sound or wise policy. And I said, if this administration is really concerned about flavored e-cigarettes, it can't draw the line just at cartridge and pod-based products because it'll be whack-a-mole. And you know what happened after that. Coming up after the break, the vaping market explodes and the moles run amok.

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25:04In January of 2020, the FDA announced a ban on flavored vaping cartridges, basically targeting Juul in hopes of solving the problem of youth vaping. Instead, the problem kind of exploded in a whole new direction. Flavored Juul pods were no longer allowed on store shelves, But almost immediately, scores of new competitors rushed in, offering brightly colored disposable vapes. And these disposables have been an enormous hit. A lot of these disposables are way, way stronger in terms of how much nicotine you inhale when you hit one. And more to the point, they are so much more aggressive than Juul ever was in terms of offering a dizzying array of kid-friendly flavors.

25:47I mean, I tried a lot of these vapes over the course of our reporting for this series. I'm going off the top of my head here. But, you know, there was a blue raspberry. There was a matcha flavored one. There was a watermelon ice. There was something called Beach Day, which is rather abstract for a flavor. But I gather it, you know, evokes the spirit of hanging out by the ocean. You know, they took the appeal of Juul and specifically the aspect of Juul's appeal that really spoke to young people and just turned it up to 11. Now, most of these disposable vapes are actually illegal. Vape companies are supposed to apply for approval from the FDA or get a waiver in order to sell their products legally.

26:29But at this point, there are just so many new makes and models that the FDA has found itself playing this kind of nightmarish game of whack-a-mole. They hear about the latest vape the kids are into. They do everything to take it off the market, only for something else to take its place. So in many cases, these disposable brands are coming from overseas. The FDA can't even really figure out who runs them in some cases. They try to send them warning letters when they can find their addresses that say basically like, you can't be selling this stuff. And they try to add certain brands of vapes to like lists of products that are banned from import, you know, that customs people at the border can seize.