Star will not position its brands as safe cigarettes because there is no such thing, said Perito, but consumers should have access to labeling so they can make informed judgments, just as they do when they glean calorie and fat content data from food labels. Should such a move occur, the change would be no different from positioning light and ultra-light brands, which make no health claims but are perceived by consumers to carry the benefits of low tar and nicotine, said Bill Pecoriello, analyst with Bernstein & Co., N.Y. The McCain bill ghost haunts the vacant halls of Capitol Hill as members of the 105th Congress returned to their home states this fall, but Big TobacCo fought on in courtrooms of Minnesota, Idaho and Florida, among others-battling huge settlement payments and public relations nightmares. The McCain legislation, which allocated substantial tobacco pricing and marketing power to the Food and Drug Administration, was killed this summer, but its spirit is sure to ris again when the regulatory is. sue is readdressed.

"We''re being very careful about not rushing the scientific development," said evp and chief counsel Paul Perito. "We''re looking at the issue of proving that reduced exposure to toxin equals reduced risk. In the meantime, we''re very conservative and are recommending that other companies refrain from making health claims."Brown & Williamson contracted to buy 1.5 million pounds of the Star-cured tobacco, about half the expected harvest from this year''s growing season, ending in October. The No. 3 producer of Kool, Capri, Misty and GPC will have low-nitrosamine cigarettes on the market within a year. Other firms are buying smaller amounts, while R.J. Reynolds is field-testing its own process for reducing tobacco toxins. Separately, Star this month will debut activated charcoal filters on all its brands.The focus on nitrosamines comes amid legislation pending in Canada proposing to add more information on labeling about tobacco''s toxic constituents and specific warnings about nitrosamines being the most active cancer-causing agent in cigarettes. Also, a World Health Organization gathering in May recommended that cigarette brands unable to conform to a standard ceiling of nitrosamine content should be excluded from markets.

To be sure, the merchandising contracts are not pushing minor brands out of stores completely. Retailers have found that some deep-discount brands offer attractive margins compared with the big boys. But for the smaller players, getting their products into the store can be an uphill climb."The big manufacturers make the contract requirements difficult for retailers to understand so they don''t know what is allowed," said Keith Grover, marketing manager for Sante Fe Natural Tobacco, maker of Natural American Spirit cigarettes. "We try to understand those programs and explain to retailers that, for instance, temporary price tags on the rack are permissible. But there''s a lot of ignorance about merchandising programs and retailers are unable to make an objective decision about profitability. Many times they don''t believe us."In a more recent development, the big tobacco companies have been pushing their merchandising away from tobacco-only outlets and toward c-stores, where price is secondary to availability for customers already used to paying a premium for other purchases, per a recent Convenience Store News survey.

©2003 www.capricigarettes.net All rights reserved.