Juul Labs plans to cut about 30 per cent of its workforce to recover from regulatory and legal setbacks in the US, reports The Times.
Juul has been struggling since regulators briefly pulled its vaping products from the market last year, and has been seeking funding or a sale of the company. The company plans to cut about 250 employees in the latest round, reducing its workforce to about 650 people from about 4,000 people four years ago, the Wall Street Journal reported.
Juul is awaiting a final decision from the Food and Drug Administration (FDA) on whether its products can remain on the market in the US after the ban was lifted pending an appeal by the company. The business managed to avoid bankruptcy last year, after securing emergency support from early backers, but attempts to secure a longer-term deal have been hampered by uncertainty over the FDA’s decision and concerns about competition from illegal disposable e-cigarettes, the report said.
Juul said in a statement: “JLI is announcing a company restructuring aimed at reducing our operating costs and positioning us to continue to advance our mission during a period of regulatory and marketplace uncertainty. The principal aim of this restructuring is to enable us to maximize profitability and cash-flow generation, while continuing to invest in our core priorities, which include delivery of high quality products to our commercial partners, ongoing development of next generation products, engagement with FDA regarding our pending and possible future market authorization applications, and commercial growth consistent with compliance with all applicable laws and regulations. To deliver on this strategy, we will be substantially reducing our headcount and, unfortunately, saying goodbye to a number of highly valued team members who have made tremendous contributions to the mission.”