Puff Bar CEOs on the company behind the popular e-cigarette brand: "There was a lot of shadowiness before"
Little is known about the company behind the most popular e-cigarette brand among high school and middle schoolers.
For two years, Puff Bar has been operating in the shadows. It listed its mailing address first to a shuttered storefront on skid row in Los Angeles and more recently to a P.O. box.
Puff Bar has teased the mystery of it all on its own website. Last year, the site read "Who Makes Puff Bar? Everyone wants to know."
Nick Minas and Patrick Beltran, two of the businessmen behind Puff Bar, sat down with "CBS Mornings" co-host Tony Dokoupil for their first television interview about the company, conducted with their lawyer just off-camera
Minas and Beltran, both 27, are childhood friends from Southern California who said they are now the sole owners and co-CEOs of Puff Bar. Beltran said they wanted to speak out to "build trust" with their consumers.
"We're aware that there is a lot of mystery and there was a lot of shadowiness before. Us being here right now, talking with you guys [CBS News] is our first step in kind of really, like, building the trust with our consumers," he said.
The market for Puff Bar exploded in early 2020 after the FDA banned candy and fruit-flavored e-cigarettes, like Juul, citing their popularity among teens.
But at the same time, the FDA left single-use devices like Puff Bar, and all its flavors on the market because they weren't yet popular.
"It kind of looks like a Juul device and, you know, it has flavors and it tastes good, it's easy, it's disposable," Beltran said. "So I think it was just very appealing to the mass consumer market as the next step past what a Juul device is."
Sales jumped from $14,000 to $3 million a week. Beltran and Minas posted lavish items on social media including a new home, fancy meals and two Lamborghinis.
But the duo said Puff Bar was not their invention and claimed that a Chinese manufacture "put this brand package together."
"I would say the brand was founded with the collaboration of U.S. personnel giving the input," said Beltran.
In 2020, the FDA ordered Puff Bar off the market amid lawsuits and a widening public outcry.
Four states have banned the product. It also faces a probe in the House of Representatives and lawsuits in at least three states. This week, North Carolina's attorney general launched an investigation.
Beltran and Minas said they took over the company around the middle of 2020 — first the website and eventually the entire brand.
"The original co-founding partners decided that they didn't want to continue the brand in the direction that we saw most fit. And that's where we kind of came into control," Minas said.
Both Minas and Beltran would not disclose who the prior partners were. They also said that the amount of money it cost to buy the Puff Bar and its trademark was "confidential" and is a part of a non-disclosure agreement.
Puff Bar or something that looks like Puff Bar are easy to find these days even in places like New York, where flavored vapes have been banned under state law.
Nielsen reports that store sales of Puff Bar in the United States topped $150 million last fiscal year, but Minas and Beltran said that almost none of it is theirs.
When showed four Puff Bar branded e-cigarettes, Minas and Beltran said all four were counterfeits.
"The imagery that's used on the front was not similar to, it's not even similar to the imagery that we originally had put on the packaging or that was originally on the packaging," Beltran said.
"Also flavors we've never made," added Minas. One of those flavors was strawberry banana which Minas said they never made in those device types.
The two said that the real Puff Bar was off the market for months and was only re-released earlier this year. It was reformulated with what they said is a synthetic nicotine, allowing them to avoid FDA regulation as a tobacco product.
"So, your revenue was essentially zero dollars from June 2020 to February of this year?" Dokoupil asked.
"Yes, that's correct," Beltran responded.
"So why should we believe you, I guess is the question? You're driving around in Lamborghinis," said Dokoupil.
"We have other investment sources that we had put our money into. I mean that's not to say that we didn't make any money from Puff. I mean, I think that'd be ignorant to think that we didn't make any money from the brand itself," Beltran said.
He added that counterfeits are "undermining" what they are doing from an "internal company perspective."
"We have new devices, completely different you know, verification system. All that would undermine that all of that back-dooring," Beltran said.
When asked if they received any backdoor payments from counterfeits selling Puff Bar, the two both said "No."
They both agree that underage use of Puff Bar is a problem.
"I think it's horrible," said Beltran.
"I guess I'm sorry to hear that... You know, and it's nothing that we would want," added Minas.
But they both said that the government needs to do more to address this problem.
"I think the governments need to do a better job on going after retailers and the distribution channels that are actually pushing these products out there," Beltran said.
Puff Bar still sells fruit flavors and teens report using the brand over Juul by five to one.
"Why continue to sell flavors? Banana Ice and Cool Mint and..." Dokoupil asked.
"I believe adults love flavors. I mean when you go out to a bar and people order drinks, are they always ordering just whiskey straight up, vodka straight up, tequila straight up? No. They get it margaritas which has, like, lime and lemon, and I think people enjoy our products with flavors, the same way they do with any other type of products," Beltran said.
CBS News asked the FDA for an interview about Puff Bar. They declined and said in a statement they're "aware that companies have publicly announced strategies to switch to synthetic nicotine in an attempt to evade FDA jurisdiction." They said they're "investigating this issue."
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