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PHILIP MORRIS STATEMENT: /~'~,~._~I~~ WE HAVE RECEIVED N0~f'I-F!CATION FROM THE FDAABOUT ~ REPORTED DECISION ASSERT AUTHORITY OVER CIGARETTES. HOWEVER, THE FACT IS THAT THE FDA HAS NO AUTHORITY TO REGULATE CIGARETTE~AND BOTH CONGRESS AND THE FDA HAVE CONSISTENTLY UPHELD THAT POSITION FOR THE PAST 80 YEARS. LAST YEAR COHHISSIONER KESSLER SAID HE NEEDED DIRECTION FROM CONGRESS BEFORE TAKING ANY ACTION ON THIS ISSUE, AND ~ HE HAS ~ RECEIVED ~ DIRECTION..- ~ ~j'6~- ~'~J~0 --PHILIP MORRIS' ]zOSITION IS THAT MINORS SHOULD NOT SMOKE, AND fWE HAVE BEEN V~6~8~S IN OUR EFFORTS TO KEEP CIGARETTES OUT /OF THE HANDS ~F MINORS.

WE AT PHILIP MORRIS._BELI~E_THAT_~SmQKING IS A PERSONAL CHOICE ~J~hkSKS OF SMOKING HAVE BEEN WELL-KNOWN FOR /YE~RS, AND WARNINGS HAVE APPEARED ON CIGARETTE PACKS FOR 30 }YEARS AND IN ADVERTISEMENTS FOR .~5 YEARS. , .... _~ / HOWEVER, CIGARETTES ARE NOT FOR MINORS AND WE AND OTHERS IN / THE INDUSTRY ARE WORKING DILIGENTLY TO KEEP CIGARETTES OUT OF THEIR HANDS. JUST LAST MONTH PHILIP MORRIS U.S.A. ANNOUNCED A SWEEPING PROGRAM -- ACTION AGAINST ACCESS -- THAT WILL MAKE IT EVEN MORE DIFFICULT FOR MINORS TO BUY CIGARETTES. THIS FURTHER DEMONSTRATES OUR LONG-STANDING CO~94ITMENT THAT WE DON'T WANT MINORS TO SMOKE. INCREASING CIGARETTE TAXES IS REGRESSIVE AND PENALIZES ADULTS WHO HAVE MADE THE DECISION TO SMOKE CIGARETTES. CIGARETTE ADVERTISING IS DESIGNED TO FOSTER BRAND LOYALTY AND TO ENCOURAGE ADULTS WHO SMOKE TO TRY OUR BRANDS. TO RESTRICT OR OTHERWISE REGULATE CIGARETTE ADVERTISING IS AN INFRINGEMENT ON THE TOBACCO INDUSTRY S RIGHT TO COMMERCIAL FREE SPEECH TO REACH THOSE ADULT SMOKERS. NICOTINE IS A NATURAL COMPONENT OF TOBACCO, AND THERE IS LESS NICOTINE IN THE FINISHED CIGARETTE THAN THAT WHICH IS PRESENT ~RAW .TOBACCO. TOBACCO ALREADY IS A HIGHLY-REGULATED PRODUCT. CONGRESS HAS ADDRESSED THE ISSUE OF WHETHER THE FDA SHOULD HAVE AUTHORITY TO REGULATE CIGARETTES NUMEROUS TIMES OVER THE PAST 80 YEARS AND CONSISTENTLY CONCLUDED THAT THE FDA SHOULD HAVE NO ROLE IN THE REGULATION OF CIGARETTES. ---B~/ COMMISSIONER KESSLER SHOW'ONCE AGAIN THAT HE FEELS GOVERKMENT SHOULD BE DICTATING LIFESTYLE CHOICES TO AMERICA'S ADULTS. THAT'S NOT THE MESSAGE AMERICANS SENT TO WASHINGTON LAST FALL. ~ p~ ~l~ ~,~ ~g~ ~4~4~

MADE TO OR ZNG TAXES IS REGRESSIVE AND PENALIZES ADULTS WHO HAVE E DECISION TO SMOKE CIGARETTES. ADVERTISING IS DESIGNED TO FOSTER BRAND LOYALTY AND ADULTS WHO SMOKE TO TRY OUR BRANDS. TO RESTRICT REGULATE CIGARETTE ADVERTISING IS AN INFRINGEMENT ON THE TOBACCO INDUSTRY'S RIGHT TO COMMERCIAL SPEECH. BELIEVE THAT SMOKING IS A PERSONAL CHOICE FOR ADULTS. THE RISKS OF SMOKING HAVE BEEN WELL-KNOWN FOR YEARS, AND WARNINGS HAVE APP~ bRED ON CIGARETTE PACKS FOR 30 YEARS AND IN ADVERTISE NICOTINE NICOTINE IN RAW T< HENTS FOR 25 YEARS.~.h IS A NATURAL COMPONEN~ OF TOBACCO, AND THERE IS LESS IN THE FINISHED CIGARETTE THAN THAT WHICH IS PRESENT ,BACCO. <

TOBACCO ALREADY IS A HIGHLY-REGULATED PRODUCT. CONGRESS HAS ~ADDRESSED THE ISSUE OF WHETHER THE FDA SHOULD HAVE AUTHORITY TO REGULATE CIGARETTES NI/MEROUS TIMES OVER THE PAST 80 YEARS AND CONSISTENTLY CONCLUDED THAT THE FDA SHOULD HAVE NO ROLE IN THE REGULATION OF CIGARETTES. ~PM AND OTHERS IN THE INDUSTRY ALREADY ARE WORKING DILIGENTLY TO KEEP CIGARETTES OUT OF THE HANDS OF MINORS. JUST LAST MONTH WE AAINOUNCED A SWEEPING PROGRAM -- ACTION AGAINST ACCESS -- THAT WILL MAKE IT EVEN MORE DIFFICULT FOR MINORS TO BUY CIGARETTES. INCREASING TAXES IS REGRESSIVE AND PENALIZES ADULTS WHO HAVE MADE THE DECISION TO SMOKE CIGARETTES. CIGARETTE ADVERTISING IS DESIGNED TO .FOSTER BRAND LOYALTY AND TO ENCOURAGE ADULTS WHO SMOKE TO TRY OUR BRANDS. TO RESTRICT OR OTHERWISE REGULATE CIGARETTE ADVERTISING IS AN INFRINGEMENT ON THE TOBACCO INDUSTRY'S RIGHT TO COMMERCIAL FREE SPEECH. WE BELIEVE THAT SMOKING IS A PERSONAL CHOICE FOR ADULTS. THE RISKS OF SMOKING HAVE BEEN WELL-KNOWN FOR YEARS, AND WARNINGS HAVE APPEARED ON CIGARETTE PACKS FOR 30 YEARS AND IN • , ADVERTISEMENTS FOR 25 YEARS . _~~ ~ ~ ~_~ ~w~/~x~ NICOTINE IS A NATURAL COMPONENT OF TOBACCO, AND THERE IS LESS NICOTINE IN THE FINISHED CIGARETTE THAN THAT WHICH IS PRESENT W TOBACCO ~