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IIJ'N ;S 0177 MEMORANDUM TO: Dr. A. W. Spears FROM:- A. B. Hudson. SUBJECT: Status Report of Major Projects June 30, 1977 Listed below is a brief summary of the status of the current major cigarette projects. Project Breakthrough (Enriched Nicotine) There are several problems inherent in this project. One is to develop a construction that will have an accept- able•draw and a filter efficiency of approximately 90%. After trying many variations, a construction with a dual acetate filter in combination with seven-line perforated tipping was developed which fulfills these requirements. Next, in the taste area, there are three problems -- impact, taste amplitude, and overall acceptability. By using strong grades of tobacco and high levels of P.T. (reduce tar), we have made samples, with and without enriched nicotine R.L., which have acceptable impact. These products have been found to be about 75% as acceptable as the proposed target (KGL). The last big negative is a lack of "body" in the smoke. A method is being sought through flavor work, both blend and filter flavor, which will give the smoker a perceived feeling of sufficient body. This is the area where an intensive effo-rt is now being made and it is felt that with the right combination of blend, filter flavor and top flavor an acceptable level of "body" can be incorporated into the product. Kent Micronite II Due to some filters recessing after production, it has been recommended that one glue line be applied to both the Kent 85 and 100 rods. Based on smoking analyses of a test run in Louisville, this does not appear to affect the T & N numbers to a degree that is statistically detectable.

,.:.. . Dr. A. W. Spears - 2 . ~~ Cocoa Replacement June 30, 1977 Samples of Kent, KGL, KGLM and Newport have been made with a cocoa replacement. A progress report was sent to you by Mr. Howard Smith dated June 8 detailing the results of the various studies which have been conducted. The conclusion of this report is that, due to the favorable panel results obtained in-lab, a mini-market research study would now be appropriate. Work is continuing on the evaluations of other replace- ments in case the market research results differ from the in-lab results. Control of DPM Yield Work has been conducted on this project as time has permitted. A progress report by Mr. Warren Kelley_will be forthcoming detailing the progress we have made to date relative to finding the parameters which have the most influence on the DPM yield. Newport Lights The initial test market results indicate that the Newport Lightis selling at a rate of about 20% of its parent brand, according to Marketing. This is mostly new business with less than expected cannibalism taking place. This product will go "down the street" in market expansion on August 22. Initial production requirements are approximately 150 million units. Old Gold Lights A market introduction for this product is planned and coincides with the Newport Lights expansion in both quantities and timing.. made. Since no market research study has been conducted, a "diaster" consumer blindfold study is now being conducted versus Winston Light and Marlboro Light. Assuming the studies turn out reasonably well, the market introduction will proceed as scheduled. If they do not, the introduction may have to be postponed until product modification can be

- Dr. A. W. Spears - 3 - June 30, 1977 Spring Lights A market research study will be conducted in the near future to select a candidate to be marketed as Spring Lights. In this study, three candidates (KGL Type, Mint Type, Merit Type) will be paneled against Merit Menthol to determine the most viable candidate. True 100 (8 mg) A three-wave market research study is planned with the first wave being placed in July. The first wave will be Current True Blue 100 versus Current True Blue 100. This study is to determine if the panel will "null" and, if not, try to determine the degree of reliability so that it can be related to the Wave Two and Three studies. The second wave, planned for August, will be Lurrent True 100 versus True (8 mg) True Taste. The third wave will be True Blue 100 versus True (8 mg) New Taste and will be placed in September. Old Gold Filter Improvement - The first step OGF improvement has been developed and will be market researched after the Spring Light and True studies are completed. The second and "final step" will be developed based on the diagnostics of the taste character- istics from the first study. 30 Pack The 30 pack product has been developed and has been tested in focus group studies and a market research study. The taste of the product was found-to be very acceptable but it is difficult to interpret the pros and cons of the circumference. A study is now being conducted to determine realistic productiorn costs and the impact of the product's perceived economy by the consumer. Despite the fact that there are many questions still to be answered, Marketing has indicated a desire to introduce the 100 mm soft paqk version. ABH/gm Xc: Dr. F. J. Schultz Mr. C. L. Tucker