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Proposals for Comprehensive Tobacco Legislation

Statement of

William B. Schultz
Deputy Commissioner for Policy
Food and Drug Administration
Department of Health and Human Services


the Senate Committee on Labor and Human Resources

February 10, 1998


Mr. Chairman and Members of the Committee, I am pleased to testify today on behalf of the Food and Drug Administration (FDA) about proposals for comprehensive tobacco legislation. We at FDA and the Department of Health and Human Services (DHHS) appreciate the leadership that you and Senator Kennedy have shown on this issue, Mr. Chairman, and we look forward to working closely with you. We do have some differences, including with some of the details of the Discussion Draft that deal with FDA's authority. But we are confident that we can resolve these issues because of our mutual commitment to enact comprehensive legislation to reduce teen smoking and the tremendous death and disease caused by tobacco products. We should point out that our comments on the Discussion Draft are based on a preliminary FDA review. The Discussion Draft has not been fully reviewed by all of the other Executive branch agencies affected by the proposed legislation.

Everyone here is familiar with the statistics. Each year 400,000 persons in this country die from use of tobacco products1, and most of these men and women started using tobacco during childhood or adolescence.2 Every day 3,000 children and adolescents begin smoking regularly 3, 1,000 of whom will die prematurely from tobacco-related diseases.4

I would like to discuss three issues in my remarks today: (1) the Agency's tobacco program; (2) the Administration's position on tobacco legislation; and (3) some of the issues raised by the portion of the Discussion Draft that deals with FDA's authority.


FDA's tobacco regulation was announced in August 1996. 5 The Agency's decision to assert jurisdiction over tobacco products and to issue its rule is grounded in two important facts. First, most tobacco users begin during childhood and adolescence. 6 More than 80 percent of the people who smoke have their first cigarette before they are 18 years old, and by that age, half have become regular smokers. And of the infants, children, and adolescents alive today, 5 million will become regular smokers and die because of their smoking. 7 Unfortunately, the problem is getting worse. Smoking rates among eighth and tenth graders have risen by one-third since 1991. 8

Second, most tobacco users are addicted. In fact, studies demonstrate that between 77 and 92 percent9 of the 50 million Americans who smoke and a large percentage of smokeless tobacco users are addicted.

In response to these facts, FDA with the support of the President and Secretary Shalala, established the Nation's first ever comprehensive program to protect children from the dangers of tobacco and a lifetime of nicotine addiction. The aim of the program is to reduce tobacco use by children and adolescents by 50 percent in seven years, and it follows many of the recommendations made by the American Medical Association and the National Academy of Sciences' Institute of Medicine. Our program will limit the availability of tobacco products to young people, as well as the appeal that these products have to young people, an appeal that is bolstered in large measure by the billions of dollars in advertising and marketing spent by the tobacco industry.

Each year, young people spend an estimated $1.26 billion 10 on tobacco products despite laws in all 50 states that prohibit sales to minors. Numerous studies have confirmed what we all have seen for ourselves, that adolescents have little difficulty in purchasing tobacco products. 11 In fact, studies of over-the-counter sales have determined that nearly 70 percent of the time children or adolescents attempt to buy cigarettes from retailers, they succeed.12 And if these youngsters have any problem at the counter, they simply go to a vending machine where studies show that they can successfully purchase cigarettes almost 90 percent of the time.13

The FDA rule is intended to change all that. The rule sets a Federal minimum age of 18 to purchase tobacco products and requires age verification. It eliminates free samples, sale of single cigarettes and packages with fewer than 20 cigarettes. It bans vending machines and self-service displays except in those places where only adults are permitted, such as certain nightclubs that are inaccessible to people under 18.

The second part of the rule is designed to reduce the appeal of tobacco to children. Tobacco is among the most heavily advertised and promoted products in the United States, with the industry spending $5 billion annually. 14 And this advertising is very effective with kids. The three most heavily advertised brands are smoked by nearly 90 percent of all kids who smoke. 15

The rule bans outdoor advertising within 1,000 feet of schools and publicly-owned playgrounds. Outdoor advertising beyond these areas is restricted to black-and-white text only. Advertising in publications with a significant readership of people under 18 is also limited to black-and-white text. The rule prohibits the sale or free distribution of products, such as caps or gym bags, that exhibit cigarette or smokeless tobacco products' brand names or logos. Studies show that nearly half of all young people who smoke own at least one of these items.16

Finally, the rule prohibits brand name sponsorship of sporting or entertainment events, such as the use of the Virginia Slims tournaments to attract healthy young women to a product that is deadly and addictive. The rule, however, permits sponsorship in the corporate name, as distinguished from brand name.

The first phase of the rule went into effect on February 28, 1997. Since that date, retailers have not been allowed to sell cigarettes or smokeless tobacco to anyone under the age of 18. And since that same date, retailers have been required to check photo ID for anyone under the age of 27.

The remainder of the regulations were scheduled to go into effect on August 28, 1997, except the sponsorship provision, which was scheduled to go into effect August 28, 1998.

In April 1997, the United States District Court for the Middle District of North Carolina ruled that FDA has jurisdiction to regulate nicotine-containing cigarettes and smokeless tobacco and upheld all of the rule's access provisions. The Court also delayed implementation of the August 28, 1997 access provisions, pending further court action. Finally, the Court invalidated, on statutory grounds, FDA's advertising restrictions. The government is appealing the advertising portion of the ruling at the same time that it is moving forward to enforce the age and ID provisions. The case currently is before the U.S. Court of Appeals for the Fourth Circuit.

FDA currently is enforcing the rule cooperatively with State and local officials. Half a million retailers sell tobacco, and FDA cannot possibly be in every store. Traditionally, when our regulations need to be enforced at the community level, we have adopted a cooperative model. This is how FDA regulations are enforced for dairy farm and retail food inspections in communities across the country -- by commissioning for the services of State and local officials. We think this is a particularly appropriate way to enforce our tobacco regulations.

Under our plan, a commissioned State or local official will accompany an adolescent under the age of 18 into a retail establishment on an unannounced visit. The adolescent will attempt to purchase cigarettes or smokeless tobacco. Records will be kept documenting each visit. Retailers who refuse to sell to the minor will get a letter from FDA telling them that they are in compliance. Retailers who do sell to the minor will receive a warning letter from FDA informing them that they have violated the rule, and that another unannounced visit will be scheduled. If they sell to the minor during the second unannounced visit, they will receive a letter stating that FDA will seek a penalty of $250. The fines escalate for subsequent violations.

Last year, we signed contracts with 10 states for enforcement of the age and photo ID requirements. The unannounced visits began last August. This year we expect to sign contracts with every single State and territory that is willing to join us in enforcing the rule. Under this program, we eventually will be conducting tens of thousands of unannounced visits across the country each month. In addition, we plan to educate retailers and others about the FDA rule through a multi-media advertising campaign.


As you know, on June 20, 1997, 40 State Attorneys General and the major tobacco companies reached a tentative settlement, contingent on enactment of Federal legislation. The Administration spent the summer reviewing and analyzing the proposed settlement. On September 19, 1997, the President called for comprehensive tobacco legislation with a goal of reducing the smoking rate among young people by 50 percent within seven years.

The President stressed that the following five key elements must be at the heart of any national tobacco legislation:

1. A comprehensive plan to reduce teen smoking, including a combination of penalties and price increases that raise cigarette prices up to $1.50 per pack over the next 10 years as necessary to meet youth smoking targets;

2. Express reaffirmation that FDA has full authority to regulate tobacco products;

3. Changes in the way the tobacco industry does business;

4. Progress toward other critical public health goals, such as the expansion of smoking cessation and prevention programs and the reduction of secondhand smoke; and,

5. Protection for tobacco farmers and their communities.

During his State of the Union address and in his recent budget for fiscal year 1999, the President again forcefully emphasized that his top priority is the reduction of underage smoking. Reducing teen smoking is the most important step that Congress and the Administration can take now to protect the Nation's health in the next century and to minimize future health care costs.


As the Committee is well aware, FDA's authority to adopt the provisions of the regulation that I have just described is grounded in the Agency's conclusion that tobacco products are combination drug/device products under the Federal Food, Drug, and Cosmetic Act. That Act provides a comprehensive set of tools which allows the Agency to craft appropriate restrictions on access to and the advertising of tobacco products. More importantly, it gives FDA the flexibility to adapt its restrictions to changing circumstances and new scientific information. One of the President's key principles for tobacco legislation is that it affirm the full authority of FDA to regulate tobacco products, building on this statutory framework. With this principle in mind, I would now like to turn to the Chairman's Discussion Draft.

First, let me say once again, Mr. Chairman, that while we have serious concerns about provisions of the draft, we look forward to working with you in a cooperative fashion to resolve these differences.

As an initial matter, it is significant that the Discussion Draft would codify many of the advertising and access restrictions that FDA adopted in its regulation. In addition, the Discussion Draft would strengthen significantly the size and content of the Surgeon General's warning currently required on tobacco products.

Nevertheless, I also must emphasize that the Discussion Draft would place unacceptable limits on FDA's authority and future flexibility to regulate tobacco products. First and foremost, the Discussion Draft fails to provide the flexibility that the Agency currently has under its drug and device authorities; instead, the Discussion Draft would severely limit FDA's authority to make future adjustments in regulating tobacco products. The Discussion Draft also limits the Agency's ability to take into account new scientific developments.

No one today can predict how tobacco products should be regulated in the future. Will the scientific understanding of nicotine lead to regulating it in some way? Will new scientific knowledge support redesigning tobacco products to make them less harmful? Fortunately the current law would allow FDA, after a thorough public process, to require improvements in tobacco products. But the Discussion Draft would hamper the Agency's authority and its ability to improve public health in the future by imposing new requirements and new standards -- such as findings about potential black markets -- that might be impossible to meet. The Discussion Draft accomplishes this by imposing onerous procedural obstacles and, in some cases, requiring that new requirements applicable to the product be approved in advance by both Houses of Congress.

In addition, the Discussion Draft would limit FDA's authority to regulate the marketing practices of tobacco companies. We believe the regulations FDA has adopted are an extremely effective approach to regulating tobacco products at the current time. We should anticipate, however, that the tobacco companies will adjust their marketing practices such that it will be necessary to make adjustments in the regulatory approach in order to maintain an effective program in reducing youth use of tobacco products.

We do not know what those future promotion strategies will be. For example, will methods be devised to make text-only advertising extremely appealing to children? Will some approach that we cannot even imagine be used? After all, who would have predicted after the 1971 TV ad ban on tobacco advertising that the companies would have designed a marketing strategy that resulted in 91 percent of 6 year olds being able to identify Joe Camel 17 and that over 25 percent of all adolescents, whether they smoked or not, would own a tobacco T-shirt, gym bag or similar item. 18

Unfortunately, we believe the Discussion Draft would prevent the Agency from responding appropriately to future developments. This limitation on the flexibility afforded by the current Federal Food, Drug, and Cosmetic Act is a very serious concern.

Finally, the Discussion Draft abolishes FDA's authority to enforce youth access restrictions. Instead, this power would be transferred to the Office of Smoking and Health in the Centers for Disease Control (CDC). This approach is flawed because CDC does not have any experience in directing a nation-wide inspection program, in training inspectors, in bringing enforcement actions against violators, and it does not have a field inspection force to deploy in states that choose not to enter into contracts with the federal authority. Moreover, dividing the responsibility for enforcing tobacco advertising and access restrictions will significantly weaken the program to reduce tobacco use by children.

This is by no means an exhaustive list of our concerns. But it provides an indication of the manner in which we believe the Discussion Draft would inappropriately limit FDA's existing authority and thus fail to satisfy the principles espoused by the President last September relative to FDA.


In closing, FDA and the Administration strongly support comprehensive tobacco legislation to significantly reduce young people's tobacco use and meet the other goals announced by the President. We look forward to working closely with you, Mr. Chairman, and other members of the Committee to meet the challenge of enacting the kind of comprehensive legislation that enables us to meet our public health objectives. We stand ready to work with you to address the concerns we have raised today.

Thank you for giving me this opportunity to share the view of the Food and Drug Administration on this important legislative initiative. I would be pleased to answer any questions you may have.

161 FR 44396 at 44398 261 FR 44396 at 44398 361 FR 44396 at 44422 461 FR 44396 at 44399 560 FR 41314 661 FR 44396 at 44398 7"Projected Smoking - Related Deaths Among Youth--U.S., 5 million," MMWR, November 8, 1996, Vol.45, No. 44. 8"Results from the 1995 Monitoring the Future Survey," National Institute on Drug Abuse Briefing for Donna E. Shalala, Ph.D., Secretary of Health and Human Services, December 13, 1995. 961 FR 44396 at 44398 10Difranza JR, Tye, "Who profits from tobacco sales to children?," JAMA, 1990, Vol. 263, pp. 2784-7. 11Department of Health and Human Services; "Preventing Tobacco Use Among Young People: A Report of the Surgeon General," Washington, DC: Government Printing Office, 1994, p. 249 (S/N-0017-001-00491-0). 12Id. 13Id. 14FTC Report to Congress, 1994. 1561 FR 44396 at 44482 1661 FR 44396 at 44525 1761 FR 44396 at 44477 1861 FR 44396 at 44525