Juul Labs Looks to Rebuild After Controversy
Juul Labs seemed to be fading into obscurity after facing years of legal issues and significant involvement in the teen vaping crisis. The company had even agreed to a hefty settlement of $1.7 billion over misleading advertising claims.
However, it’s making a comeback, shifting its focus back to creating smoking cessation devices aimed at adult smokers, all while striving to keep its products from kids.
“Everyone thought Juul was dead and evil,” said James Sagan, CEO of Architect Capital and a Juul investor since 2023, in an interview with New York Next. “But early investors and founders put in a lot of money to salvage the company.”
Juul’s founders, James Monsees and Adam Bowen, originally met in 2005 at Stanford University, where they were graduate students. Their goal was to develop a compact e-cigarette to help smokers quit traditional cigarettes, but, ironically, their invention ended up being embraced by Big Tobacco rather than serving as a viable alternative.
Central to Juul’s revival strategy is the Juul2, a new e-cigarette featuring a biometric protector intended to limit access solely to adult smokers.
To use Juul flavor pods, customers must confirm their age and identity via a smartphone application, utilizing facial recognition or other biometric logins available on their devices.
The Juul2 pods come equipped with a hardware chip that connects to the app through Bluetooth. Only validated users can unlock their e-cigarettes, using a linked ID.
“This new product aims to solve two main issues: keeping e-cigarettes away from children and making them appealing to adult smokers,” Sagan noted.
Additionally, the Juul2 boasts a larger battery, an LED display to track puff count and battery life, and firmware enhancements for remote updates and usage monitoring.
Currently, the device awaits regulatory approval in the U.S. Meanwhile, it is available in the UK without the biometric features.
The scientific community remains divided on the effectiveness of e-cigarettes in aiding people to stop smoking.
In a 2023 statement, the American Heart Association acknowledged that e-cigarettes might be less harmful than traditional cigarettes but emphasized that more research is needed to fully understand long-term safety implications. A study in 2025 from Johns Hopkins School of Medicine highlighted that adult e-cigarette usage could lead to higher risks of health issues like high blood pressure and chronic obstructive pulmonary disease (COPD).
When Sagan got involved with Juul two years ago, the company was experiencing significant financial and legal turmoil.
In 2022, Juul settled thousands of lawsuits from districts, individuals, and various entities, agreeing to a $1.7 billion payout over claims of excessive addictiveness of its products.
That same year, Juul was on the verge of having all its products removed from U.S. stores due to an FDA marketing ban. After a tense legal struggle, it managed to remain on shelves, but the situation dealt a severe blow to the company.
The marketing order surprised retailers and further tarnished a brand that had become emblematic of youth vaping issues.
Back in 2018, Altria, a leading tobacco producer, had acquired a 35% stake in Juul for $12.8 billion, boosting the company’s valuation to about $38 billion. Yet by 2023, much of that value had evaporated, prompting Altria to withdraw.
Sagan characterized his exit as a fortuitous turn of events.
“The company became independent again. Right now, the founders and early investors own it, with me being the first big external participant,” he shared with New York Next.
The Juul2 is a major gamble in a saturated market.
Research and Markets estimate that the global smoking cessation sector—including e-cigarettes, gums, patches, and other alternatives—is valued at close to $35 billion. Other businesses like Reynolds American (Vuse), Imperial Brands (blu), and Altria (NJOY) are also promoting e-cigarette devices for this purpose.
Despite the challenges, Sagan exudes optimism.
“We believe Juul is a mission-driven company taking on critical public health issues. The truth will emerge eventually,” he concluded.
