So What’s the Dark Side Up To?

1. So What’s the Dark Side Up To? Danny McGoldrick Vice-President, Research Campaign for Tobacco-Free Kids

2. The Tobacco Industry Claims It Has Changed...

3. THE TRUTH • Still Marketing to Kids • Still Opposing Real Policy Change • Still Attacking Real Tobacco Control Programs and Promoting Phony Ones • Still Lying About Their Products and Introducing New Ones

4. U.S. Cigarette Company Marketing Expenditures Nationally, 1998-2003 U.S. Federal Trade Commission (FTC), Cigarette Report for 2003 (2005).

5. Domestic Cigarette Advertising and Promotional Expenditures 1998 - 2003(thousands of dollars) $15.15 Billion $12.47 Billion $11.22 Billion $9.59 Billion $8.24 Billion $6.73 Billion Includes $10.8 Bill. in price discounts Source: Federal Trade Commission Cigarette Report for 2003

6. IMPACT OF PRICE DISCOUNTS • From 1997 to 2002, the average retail pack price of cigarettes increased by nearly 91 percent, and youth smoking rates declined by 26.8 percent among twelfth graders and 44.8 percent among eighth graders. • From 2002 to 2004, the avg retail pack price barely increased at all (only two cents, or .5 percent) despite a 28 percent increase in state cigarette taxes. and youth smoking declines slowed markedly - the decline was only 6.4 percent among twelfth graders and 14 percent among eighth graders.

7. TRENDS IN PROMOTIONS • Point of sale promotions have increased in recent years. Virtually all retail outlets have some form of tobacco promotions, and the amount of marketing materials per store has increased over time. • There is more interior and exterior tobacco advertising in retail outlets in low-income communities and communities with larger African-American populations. • Cigarette prices for premium brands like Marlboro and Newport are LOWER in low-income communities and in communities with higher percentages of African-Americans. While some of this is clearly attributable to differences in state tobacco taxes, these differences do not explain anywhere near all of the variation. • It is also interesting to note that tobacco advertising inside and outside retail outlets in greater in states with comprehensive tobacco prevention programs. This suggests efforts by the industry to counter the effectiveness of these programs.

9. Entertainment Weekly July 30, 2004 YR: 14.79%* Sports Illustrated June 28, 2004 YR: 17.99%* *Simmons 2003

11. Rolling Stone November 25, 2004

12. Cosmopolitan, Vogue & Elle April 2005 US Weekly March 14, 2005

13. Latina September 2005 Sports Illustrated September 5, 2005 YR: 17.99%* *Simmons 2003

17. Latina April 2005

18. Entertainment Weekly January 14, 2005 YR: 14.79% *Simmons 2003

19. International Communications Research (ICR) Nationwide survey of teens aged 12-17; Nationwide survey of adults March 2005

20. International Communications Research (ICR) Nationwide survey of teens aged 12-17; Nationwide survey of adults March 2005

21. Percentage of Smokers Who Tried Any Camel, Kool, or Salem Flavored Cigarettes During the Previous 30 Days, by Age – United States, 2004 Sources: National Youth Smoking Cessation 12-Month Follow-up Survey of 17-26 year old smokers: n = 1,603; Assessing Hard Core Smoking Survey of adult smokers 25 years and older: n = 867.

22. TARGETING YOUNG ADULTS “Industry research indicates that progression to confirmed smoker is accompanied by increases in consumption “The 10 years following the teenage years is the period during which average daily consumption per smoker increases to the adult level.” March 31, 1981, Philip Morris Bates No. 1000390803.

23. TARGETING YOUNG ADULTS • Bar Promotions – 4900 events scheduled in California alone in ONE MONTH • Building Databases for Direct Marketing • Concerts/Contests • On-Campus Events

24. OK: Opposing the Tax Initiative THE FINE PRINT:A coalition that includes Philip Morris USA, Inc., R.J. Reynolds Tobacco Co. and Cigar Association of America

25. “They say everything is big in Texas, but that’s not always a good thing. Take the huge new tax increase that’s working through the Legislature right now. The Texas state comptroller calls it the largest tax bill in Texas history, and if it passes Texans will have the highest state sales tax in the country. They will also pile a bunch of taxes on people who can least afford it. The tax on a pack of cigarettes will more than triple. They raise taxes on snacks and soft drinks, even car repairs. There’s higher taxes on small business too. Statewide newspapers report taxes on average Texans will increase 5 percent, while the well-off actually get a tax cut. Call your state senator at 1-800-224-3700. That’s 1-800-224-3700. Ask them to stop this big tax increase on hard-working Texans. Paid for by Philip Morris USA.” (Transcription of a radio ad that ran the week of 4/11-15 on several Austin radio stations. Audio file available from Texans Investing in Healthy Families).

29. If this weren’t bad for our business, we wouldn’t be here. We wouldn’t care. -- Stephen Riedl, Executive Director, Illinois Licensed Beverage Association (Chicago NBC5.com 11/28/2005 “Mr. Riedl was very familiar with the issue and strongly support (sic) the Philip Morris position,” a summary of the meeting said. “He went on to say that he would do anything Philip Morris asked on this issue.” -- An Aug. 11, 2001, report by Philip Morris official Scott McPherson details a meeting he had with Riedl about the cigarette company’s efforts to have the U.S. Food and Drug Administration take over regulation of tobacco products. (Reported in Springfield, IL Journal Register, 11/27/2005

31. On Behalf of Philip Morris U.S.A. I write to express our deep concern about a new advertising campaign sponsored by the Utah Department of Health that is currently being broadcast in the State of Utah - in particular, the television ads, “Hooked on First Cigarette” and “Lies.” CC: Attorney General Mark Shurtleff Randy Rigby - KJZZ-TV Channel 14 Steven Lindsley - KSL-TV Channel 5 Duffy Dyer - KSTU-TV Channel 13 Robert Furlon - KTVX-TV Channel 4 Dave Phillips - KUTV-TV Channel 2

32. New "Reduced Risk" Products Being Marketed to Smokers as Healthier Alternatives

33. The departing executive chairman of Reynolds American Inc. refused to concede that cigarette smoking causes disease during testimony on Monday in the government's $280 billion tobacco industry racketeering trial. Long-time Reynolds executive Andrew Schindler defended Reynolds' view that cigarettes "may contribute" to disease in "some individuals" An important development today in the federal government's case against the industry. Tobacco exec challenged about key stance in trial. By Peter Kaplan, 24 January 2005 (c) 2005 Reuters Limited WASHINGTON, Jan 24 (Reuters) - The departing executive chairman of ReynoldsAmerican Inc. refused to concede that cigarette smoking causes diseaseduring testimony on Monday in the government's $280 billion tobacco industry racketeering trial. Long-time Reynolds executive Andrew Schindler defended Reynolds' view that cigarettes "may contribute" to disease in "some individuals" as a government attorney raised the company's position as an example of how cigarette makers have deceived the public about the dangers of smoking. U.S. public health officials concluded decades ago that smoking leads to lung cancer and a range of other serious diseases. Some other tobacco companies, such as Altria Group Inc.'s (MO.N) Philip Morris USA, a co-defendent, now concede the point unequivocally. Schindler was asked to explain why Reynolds still does not acknowledge -without conditions - that smoking causes lung cancer and other diseases. He said he had decided against changing the company's stance several years ago after consulting with scientists at company. "They all concluded that they were comfortable with the Web site the way it is," said Schindler, who stepped down as chief executive of R.J. Reynolds Tobacco Holdings last summer when it bought Brown & Williamson in 2004 and emerged from the deal with a new name. He was met with skepticism when he told the presiding judge that the company's current position is "a pretty straightforward expression of my own feelings" on the issue. "If it's so straightforward, why not use simple language to convey it?” asked U.S. District Judge Gladys Kessler. Schindler is due to leave Reynolds American next week. The government's suit, filed in 1999, targets Altria and its Philip Morris unit; Loews' Lorillard Tobacco unit, which has a tracking stock, Carolina Group (CG.N); Vector Group Ltd.'s (VGR.N) Liggett Group; Reynolds American Inc.'s R.J. Reynolds Tobacco and British American Tobacco Plc (BATS.L) unit British American Tobacco Investments Ltd. Reynolds' stance on the hazards of smoking, as posted on the company Web site, reads: "We produce a product that has significant and inherent health risks for a number of serious diseases, and may contribute to causing these diseases in some individuals."

35. NATIONAL CANCER INSTITUTE REVEALS THE LOW-TAR LIE • Study found “light” and “low-tar” cigarettes no less harmful than other brands • Tobacco industry deliberately marketed low-tar cigarettes to prevent smokers from quitting • “In effect, the Marlboro 85 smokers in this study did not achieve any reduction in smoke intake by smoking a cigarette (Marlboro Light) normally considered lower in delivery.” (Philip Morris --1975)

37. “[It] will not kill them as quick or as much as other brands,” Bennett LeBow, CEO, Vector, Manufacturer of new Omni cigarettes. -- USA Today 1/11/02

38. SCOR: Smoke Constituent Reduction • Philip Morris: Marlboro UltraSmooth .

40. Disclaimer: No animals were harmed for the creation of this ad

43. Conclusion: The promotion of smoking by the tobacco industry appears to undermine the capability of authoritative parenting to prevent adolescents from starting to smoke.(Volume 23, Issue 2, August 2002, Pages 73-81) Does Tobacco Marketing Undermine the Influence of Recommended Parenting in Discouraging Adolescents from Smoking? John P. Pierce PhD, , Janet M. Distefan PhD, Christine Jackson PhD, Martha M. White MS and Elizabeth A. Gilpin MS a Cancer Prevention and Control Program, Cancer Center, University of California-San Diego (Pierce, Distefan, White, Gilpin), San Diego, California, USAb Department of Health Behavior and Health Education, School of Public Health, University of North Carolina at Chapel Hill (Jackson), Chapel Hill, North Carolina, USA Abstract Objective: The tobacco industry contends that parenting practices, not marketing practices, are critical to youth smoking. Our objective was to examine whether tobacco-industry marketing practices undermine the protective effect of recommended authoritative parenting against adolescent smoking. Results: Adolescents in families with more-authoritative parents were half as likely to smoke by follow-up as adolescents in families with less-authoritative parents (20% vs 41%, p <0.0001). In families with more-authoritative parents, adolescents who were highly receptive to tobacco-industry advertising and promotions were significantly more likely to smoke (odds RATIO=3.52, 95% confidence INTERVAL =1.10–11.23), compared to those who were minimally receptive. This effect was not significant in adolescents in families with less-authoritative parents. The overall attributable risk (adjusted for exposure to peer smokers) of smoking from tobacco-industry advertising and promotions was 25%. However, an estimated 40% of adolescent smoking in families with more-authoritative parents was attributable to tobacco-industry advertising and promotions; this was five times the attributable risk seen in families with less-authoritative parents (8%). Conclusion: The promotion of smoking by the tobacco industry appears to undermine the capability of authoritative parenting to prevent adolescents from starting to smoke.

44. Results showed that children's odds of daily smoking were reduced by 39% for those whose parents had quit smoking, compared with those whose parents were current smokers Parental smoking cessation and children's smoking: Mediation by antismoking actions. 2005 Aug, 7(4):501-9Bricker JB, Leroux BG, Robyn Anderson M, Raja KB, Peterson AV Cancer Prevention Research Program, Division of Public Sciences, Fred Hutchinson Cancer Research Center, Seattle, WA.The present study investigated whether parents' antismoking actions mediated the prospective relationship between parental smoking cessation and children's smoking. Smoking status of parents (predictor) was assessed when their children were in 3rd grade, parental antismoking actions (mediators) were assessed when their children were in 11th grade, and children's smoking status (outcome) was assessed when they were in 12th grade. In 20 Washington state school districts, data were collected from 1,600 children (49% female, 91% White) and from their parents. Results showed that children's odds of daily smoking were reduced by 39% (95% CI = 24%-51%) for those whose parents had quit smoking, compared with those whose parents were current smokers. Asking to sit in nonsmoking sections of public establishments was a significant (p<.01) mediator that explained 64% of the association between parental smoking cessation and children's smoking. However, not allowing smoking in the home and asking others not to smoke around them were not significant mediators (p = .10, and p = .06, respectively). In conclusion, asking to sit in a nonsmoking section of a public establishment substantially mediates the relationship between parental smoking cessation and children's smoking.

45. Getting to the Truth: Evaluating National Tobacco Countermarketing Campaigns Matthew C. Farrelly, PhD, Cheryl G. Healton, DrPH, Kevin C. Davis, MA, Peter Messeri, PhD, James C. Hersey, PhD and M. Lyndon Haviland, DrPH Matthew C. Farrelly and Kevin C. Davis are with Research Triangle Institute, Research Triangle Park, NC. Cheryl G. Healton, Peter Messeri, and M. Lyndon Haviland are with the American Legacy Foundation, Washington, DC. James C. Hersey is with Research Triangle Institute, Washington, DC. Objectives. This study examines how the American Legacy Foundation's"truth" campaign and Philip Morris's "Think. Don't Smoke" campaignhave influenced youths' attitudes, beliefs, and intentions towardtobacco. Results. Exposure to "truth" countermarketing advertisementswas consistently associated with an increase in anti-tobaccoattitudes and beliefs, whereas exposure to Philip Morris advertisementsgenerally was not. In addition, those exposed to Philip Morrisadvertisements were more likely to be open to the idea of smoking. Conclusions. Whereas exposure to the "truth" campaign positivelychanged youths' attitudes toward tobacco, the Philip Morriscampaign had a counterproductive influence. (Am J Public Health.2002;92:901–907) Conclusions. Whereas exposure to the "truth" campaign positivelychanged youths' attitudes toward tobacco, the Philip Morriscampaign had a counterproductive influence. (Am J Public Health.2002;92:901–907)

46. Danny McGoldrickVice-President, Research Campaign for Tobacco-Free Kids (202) 296-5469 X3009 dmcgoldrick@tobaccofreekids.org www.tobaccofreekids.org