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Juul Looks at Japan Market Amid Push to Recover From Setbacks

Juul Labs Inc., the U.S.-based e-cigarette maker that’s fighting a global backlash against vaping, is considering entry into the tightly regulated Japanese market.

Haruhiko Hirate, formerly a corporate officer at Tokyo-based Takeda Pharmaceutical Co., was hired to lead the effort, Juul said Tuesday in a statement. He was named representative director and chairman of the newly formed Juul Labs Japan Co.

Entering the Japanese market will be a challenge for Juul and Hirate, who was head of corporate communications and public affairs at Takeda. Nicotine-containing e-cigarettes are classified as pharmaceutical products and require a license to be sold in Japan. None has yet won approval.

But Japan has become a battleground for another category of cigarette alternatives that heat tobacco rather than burning it. If Juul enters the market, it would compete with products from tobacco giants such as Philip Morris International Inc.’s IQOS and British American Tobacco Plc’s Glo.

Juul “must be a responsible and science-driven company that earns trust with public health stakeholders and society,” Hirate said in the statement. “I look forward to ensuring that Juul Labs Japan Co. Ltd. takes such a methodical approach as it explores bringing its electronic nicotine delivery system to Japan’s 19 million smokers.”

Juul has had a tumultuous year. It’s the target of government investigations and hundreds of lawsuits in the U.S. after vaping gained popularity with young people and was initially blamed for a lung illness later tied to faulty cannabis products. India banned e-cigarettes and Juul products were abruptly removed from online stores days after being introduced in China. The company has exited markets where it struggled to gain a footing, such as South Korea, after a rapid global expansion.

Juul’s largest market remains the U.S. where it faces a deadline this year for applying to the Food and Drug Administration for permission to continue selling its products. Juul said it never targeted minors and is focused on the world’s 1 billion smokers. The company has announced that its headquarters will move from San Francisco, where e-cigs are banned, to Washington, D.C., to be closer to regulators and policy makers.

New Chief Executive Officer K.C. Crosthwaite is attempting to repair Juul’s image and relationship with regulators around the world. Crosthwaite said in the statement that Hirate can help Juul earn trust and engage Japanese regulators.

Angelica LaVito/Bloomberg