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TOBACCO OUTLET BUSINESS
MAY/JUNE 2012
TMA REPORT
FDA:
of demonstrating that the rule is narrowly tailored
to achieve a constitutionally permissible form of
compelled commercial speech.” Commenting on
Judge Leon’s ruling, RJ Reynolds Tobacco Company
said the court cited data included in the FDA’s
regulation that showed that the graphic warnings
would have little to no effect in reducing smoking,
and noted that the chief expert report relied on by the
FDA conceded that the goal of such graphic warnings
“is not to promote informed choice but rather to
discourage consumption of tobacco products.”
Morgan Stanley analysts said Judge Leon’s rejection
of the proposed graphic warning labels is a favorable
development and not a surprise, adding however
that they do not believe the ruling will change the
thrust of the agency’s regulatory efforts with respect
to tobacco, and commercial free speech will not
protect the industry in other defenses. UBS analysts
said the ruling is a “clear example of checks and
balances in our government system that plays to the
Big 3’s advantage” and sets a precedent for future
government and tobacco industry lawsuits, which
“will be forced to consider the industry’s rights despite
their selling of an arguably harmful product.” Wells
Fargo analysts said Judge Leon’s ruling, while “not
entirely unexpected,” is a favorable outcome for the
industry for now, adding that they are “encouraged
that, in this case as well as in others, the courts seem
to be increasingly supportive of the tobacco industry.”
Deutsche Bank analysts said the three-member
panel of the U.S. Court of Appeals for the District of
Columbia, which is scheduled to hear on April 10 oral
arguments for the government’s appeal of U.S. District
Judge Richard Leon’s November 2011 preliminary
injunction that put the FDA’s warning labels on hold,
is expected to be “an overall conservative line-up”
that appears favorable to the industry, consisting of
Judges Randolph (GH Bush appointee), Brown (GW
Bush appointee) and Rogers (Clinton appointee).
…Saying that “the smoking rate among adults
has been stalled since 2004” and “approximately
20 percent of U.S. high school students currently
smoke,” the Center for Tobacco Products ushered in
the previously announced FDA and National Institutes
of Health’s five-year, $118.3 million “
Population
Assessment on Tobacco Health Study
(PATH)” of
over 40,000 smokers and nonsmokers, including
7,000 youths aged 12-18, to be conducted by survey
groupWestat, which seeks to understand why people
start using a specific tobacco product, why and when
people stop using them and why they resume, their
susceptibility to tobacco use, frequency of use,
characteristics of smoking cessation and relapse,
effects of regulatory changes on the perception
of risk, and differences in attitudes, behaviors and
health outcomes in racial-ethnic, gender, and age
subgroups.
...At the FDA’s February 21
tobacco compliance
training webinar for retailers
on “Warning Letter and
Civil Money Penalty Update,” Tara Goldman of the
Center for Tobacco Products’ Office of Compliance
and Enforcement said that the FDA will change the
format of its warning letters by removing some of
the arduous legal language and include information
about the time of a retail compliance inspection when
a violation occurred.
…The U.S. Food and Drug Administration said it is
requesting a
FY13 budget of $4.5 billion
to “protect
and promote the public health,” a 17 percent increase
from the FY12 budget, with industry user fees to fund
98 percent of the proposed budget increase.
…Commenting on the recently released draft
summary of the FDA’s TPSAC report on
dissolvable
tobacco products
(DTPs), University of Louisville
Prof. Brad Rodu said the overall message in the
report is “positive” in that it acknowledges the
significantly lower risk profile of DTPs compared
to cigarettes, but “it is not clear how the committee
concluded that DTPs ‘should be less hazardous’
than other types of smokeless products currently
available in the US despite the available evidence
that ‘TSNA levels in all popular American
smokeless products are minuscule,’ or how TPSAC
suggests that ‘DTPs could cause population harm
by either increasing the number of tobacco users
or reducing cessation,’ which are ‘persistent but
speculative concerns’ among tobacco control
advocates.”