69524 Federal Register / Vol. 75, No. 218 / Friday, November 12, 2010 / Proposed Rules 

DEPARTMENT OF HEALTH AND 

HUMAN SERVICES 

Food and Drug Administration 

21 CFR Part 1141 

[Docket No. FDA–2010–N–0568] 

RIN 0910–AG41 

Required Warnings for Cigarette 

Packages and Advertisements 

AGENCY: Food and Drug Administration, 

HHS. 

ACTION: Proposed rule. 

SUMMARY: The Food and Drug 

Administration (FDA) is proposing to 

amend its regulations to add a new 

requirement for the display of health 

warnings on cigarette packages and in 

cigarette advertisements. The proposed 

rule would implement a provision of the 

Family Smoking Prevention and 

Tobacco Control Act (Tobacco Control 

Act) that requires FDA to issue 

regulations requiring color graphics 

depicting the negative health 

consequences of smoking to accompany 

the nine new textual warning statements 

that will be required under the Tobacco 

Control Act. The Tobacco Control Act 

amends the Federal Cigarette Labeling 

and Advertising Act (FCLAA) to require 

each cigarette package and 

advertisement to bear one of nine new 

textual warning statements. This 

proposed rule, once finalized, would 

specify the color graphics that must 

accompany each of the nine new textual 

warning statements. 

DATES: Interested persons may submit 

either electronic or written comments 

on this proposed rule by January 11, 

2011. See section IV.G of this document 

for the proposed effective date of a final 

rule based on this proposed rule. 

ADDRESSES: You may submit comments, 

identified by Docket No. FDA–2010–N– 

0568 and/or RIN number 0910–AG41, 

by any of the following methods: 

Electronic Submissions 

Submit electronic comments in the 

following way: 

• Federal eRulemaking Portal: http:// 

www.regulations.gov. Follow the 

instructions for submitting comments. 

Written Submissions 

Submit written submissions in the 

following ways: 

• FAX: 301–827–6870. 

• Mail/Hand delivery/Courier (for 

paper, disk, or CD–ROM submissions): 

Division of Dockets Management (HFA– 

305), Food and Drug Administration, 

5630 Fishers Lane, rm. 1061, Rockville, 

MD 20852. 

Instructions: All submissions received 

must include the agency name and 

Docket No(s). and Regulatory 

Information Number (RIN) for this 

rulemaking. All comments received may 

be posted without change to http:// 

www.regulations.gov, including any 

personal information provided. For 

additional information on submitting 

comments, see the ‘‘Comments’’ heading 

of the SUPPLEMENTARY INFORMATION

section of this document. 

Docket: For access to the docket to 

read background documents or 

comments received, go to http:// 

www.regulations.gov and insert the 

docket number(s), found in brackets in 

the heading of this document, into the 

‘‘Search’’ box and follow the prompts 

and/or go to the Division of Dockets 

Management, 5630 Fishers Lane, rm. 

1061, Rockville, MD 20852. 

FOR FURTHER INFORMATION CONTACT: 

Gerie Voss or Kristin Davis, Center for 

Tobacco Products, Food and Drug 

Administration, 9200 Corporate Blvd., 

Rockville, MD 20850–3229, 877–287– 

1373, gerie.voss@fda.hhs.gov or 

kristin.davis@fda.hhs.gov. 

SUPPLEMENTARY INFORMATION: 

Table of Contents 

I. Legal Authority and Background 

II. Cigarette Use in the United States and the 

Resulting Health Consequences 

A. Smoking Prevalence Among Adults and 

Children 

B. Initiation of Smoking Among Adults and 

Children 

C. Costs to Society and Health Effects of 

Cigarettes 

1. Costs of Smoking to Society 

2. Negative Health Effects of Cigarettes 

III. Data Concerning Health Warnings 

A. Current Warnings on Cigarette Packages 

and Advertisements Are Inadequate 

1. Current Warnings Have Not Changed in 

More Than Twenty-Five Years 

2. Current Warnings Often Go Unnoticed 

3. Current Warnings Fail to Convey 

Relevant Information in an Effective 

Manner 

B. Larger, Graphic Warnings Communicate 

More Effectively: International 

Experience 

1. Getting Consumers’ Attention 

2. Influencing Consumers’ Awareness of 

Cigarette-Related Health Risks 

3. Impacting Smoking Intentions and 

Behaviors 

C. Benefits of FDA’s Proposed Required 

Warnings 

1. The Addition of Graphic Images Will 

Have a Significant, Positive Impact on 

Public Health 

2. The Revised Textual Statements Will 

Communicate More Effectively 

D. FDA’s Process for Development and 

Plan for Selection of the Required 

Warnings 

IV. Description of Proposed Regulations 

A. Section 1141.1—Scope 

B. Section 1141.3—Definitions 

C. Section 1141.10—Required Warnings 

D. Section 1141.12—Incorporation by 

Reference of Required Warnings 

E. Section 1141.14—Misbranding of 

Cigarettes 

F. Section 1141.16—Disclosures Regarding 

Cessation 

G. Proposed Effective Date 

V. Paperwork Reduction Act of 1995 

VI. Executive Order 13132: Federalism 

VII. Environmental Impact 

VIII. Analysis of Impacts 

A. Introduction and Summary 

B. Need for Rule 

C. Benefits 

1. Reduced Smoking Rates 

2. Expected Life-Years Saved 

3. Benefits of Reduced Premature Mortality 

4. Reduced Emphysema 

5. Reduced Fire Costs 

6. Medical Services 

7. Summary of Benefits 

8. Uncertainty Analysis 

D. Costs 

1. Number of Affected Entities 

2. Costs of Changing Cigarette Labels 

3. Market Testing Costs Associated With 

Changing Cigarette Package Labels 

4. Advertising Restrictions: Removal of 

Noncompliant Point-of-Sale Advertising 

5. Government Administration and 

Enforcement Costs 

6. Summary of Costs 

E. Cost-Effectiveness Analysis 

F. Distributional Effects 

1. Tobacco Manufacturers, Distributors, 

and Growers 

2. National and Regional Employment 

Patterns 

3. Retail Sector 

4. Advertising Industry 

5. Excise Tax Revenues 

G. International Effects 

H. Regulatory Alternatives 

1. 24-Month Compliance Period 

2. Six-Month Compliance Period 

3. Summary of Regulatory Alternatives 

I. Impact on Small Entities 

1. Description and Number of Affected 

Small Entities 

2. Description of the Potential Impacts of 

the Final Rule on Small Entities 

3. Alternatives to Minimize the Burden on 

Small Entities 

IX. Comments 

X. References 

I. Legal Authority and Background 

The Tobacco Control Act was enacted 

on June 22, 2009, amending the Federal 

Food, Drug, and Cosmetic Act (FD&C 

Act) and FCLAA, and providing FDA 

with the authority to regulate tobacco 

products (Pub. L. 111–31; 123 Stat. 

1776). Section 201 of the Tobacco 

Control Act modifies section 4 of 

FCLAA (15 U.S.C. 1333) to require that 

nine new health warning statements 

appear on cigarette packages and in 

cigarette advertisements: 

• WARNING: Cigarettes are addictive 

• WARNING: Tobacco smoke can 

harm your children 


emcdonald on DSK2BSOYB1PROD with PROPOSALS2
Federal Register / Vol. 75, No. 218 / Friday, November 12, 2010 / Proposed Rules 69525 

1Section 202(b) of the Tobacco Control Act 

amends section 4 of FCLAA (15 U.S.C. 1333) to add 

a new subsection (d), ‘‘Change in Required 

Statements.’’ However, section 201 of the Tobacco 

Control Act also amends section 4 of FCLAA to add 

a new subsection (d), ‘‘Graphic Label Statements.’’ 

2Provisions regarding adjustments to the health 

warnings and other disclosures are also in sections 

4(b)(4) and 4(d) of FCLAA, as amended by section 

201 of the Tobacco Control Act. 

3There are 168 signatories to the WHO’s 

Framework Convention on Tobacco Control as of 

August 2010. At this time, the United States is a 

signatory but has not ratified this treaty. 

4Countries/jurisdictions that have implemented 

pictorial warning requirements for tobacco 

packaging include: Australia; Belgium; Brazil; 

Brunei; Canada; Chile; Colombia; Cook Islands; 

Djibouti; Egypt; Hong Kong; India; Iran; Jordan; 

Continued 

• WARNING: Cigarettes cause fatal 

lung disease 

• WARNING: Cigarettes cause cancer 

• WARNING: Cigarettes cause strokes 

and heart disease 

• WARNING: Smoking during 

pregnancy can harm your baby 

• WARNING: Smoking can kill you 

• WARNING: Tobacco smoke causes 

fatal lung disease in nonsmokers 

• WARNING: Quitting smoking now 

greatly reduces serious risks to your 

health. 

Section 201 also states that ‘‘the 

Secretary [of Health and Human 

Services] shall issue regulations that 

require color graphics depicting the 

negative health consequences of 

smoking’’ to accompany the nine new 

health warning statements. 

Section 202(b) of the Tobacco Control 

Act amends section 4 of FCLAA (15 

U.S.C. 1333) to add a new subsection 1

that permits FDA to, after notice and an 

opportunity for the public to comment, 

adjust the format, type size, color 

graphics, and text of any health warning 

statement if such a change would 

promote greater public understanding of 

the risks associated with the use of 

tobacco products. Similarly, section 

202(b) of the Tobacco Control Act 

permits FDA to adjust the format, type 

size, and text of any other disclosures 

required under the FD&C Act, using the 

same process and upon the same basis 

as for adjusting the health warning 

statements.2 Among the provisions of 

the FD&C Act that provide authority to 

require disclosures is section 906(d) (21 

U.S.C. 387f(d)). This provision 

authorizes FDA to issue regulations 

restricting the sale or distribution of 

cigarettes and other tobacco products, 

including restrictions on the advertising 

and promotion of such products, if FDA 

determines the restriction is appropriate 

for protecting the public health. 

These requirements are supplemented 

by the FD&C Act’s misbranding 

provisions, which require that product 

advertising and labeling include proper 

warnings. For example, a tobacco 

product is deemed misbranded under 

section 903(a)(1) or (a)(7)(A) of the 

FD&C Act (21 U.S.C. 387c(a)(1) or 

(a)(7)(A)) if its labeling or advertising is 

false or misleading in any particular. 

Under section 201(n) of the FD&C Act 

(21 U.S.C. 321(n)), in determining 

whether labeling or advertising is 

misleading, the agency considers, 

among other things, the failure to reveal 

material facts concerning the 

consequences that may result from the 

customary or usual use of the product. 

Similarly, under section 903(a)(8)(B) of 

the FD&C Act (21 U.S.C. 387c(a)(8)(B)), 

a tobacco product is deemed 

misbranded unless the manufacturer, 

packer, or distributor includes in all 

advertisements and other descriptive 

printed matter a brief statement of, 

among other things, the relevant 

warnings. Moreover, a tobacco product 

is deemed misbranded under section 

903(a)(7)(B) of the FD&C Act (21 U.S.C. 

387c(a)(7)(B)) if it is sold or distributed 

in violation of regulations prescribed 

under section 906(d) of the FD&C Act. 

Under section 701(a) of the FD&C Act 

(21 U.S.C. 371(a)), FDA has authority to 

issue regulations for the efficient 

enforcement of the FD&C Act. 

Cigarette smoking kills an estimated 

443,000 Americans each year, most of 

whom began smoking when they were 

under the age of 18 (Ref. 1). Tobacco use 

is the foremost preventable cause of 

premature death in America, and has 

been shown to cause cancer, heart 

disease, and other serious adverse 

health effects (Ref. 2). In enacting the 

Tobacco Control Act, Congress found 

that providing FDA with authority to 

regulate tobacco products, including the 

advertising and promotion of such 

products, would result in significant 

benefits to the American public in 

human and economic terms (section 

2(12) of the Tobacco Control Act). The 

U.S. government has a substantial 

interest in reducing the number of 

Americans, particularly children and 

adolescents, who use cigarettes and 

other tobacco products in order to 

prevent the life-threatening health 

consequences associated with tobacco 

use (section 2(31) of the Tobacco 

Control Act). Virtually all new users of 

tobacco products are minor children 

and a reduction in tobacco use by this 

population alone could significantly 

reduce tobacco-related death and 

disease in the United States (Ref. 3 at 

pp. 5–6). 

In 1964, the Surgeon General of the 

Public Health Service issued the 

landmark report titled ‘‘Smoking and 

Health,’’ which comprehensively 

assessed the available scientific 

evidence relating to the health effects of 

cigarette smoking and concluded that 

cigarette smoking is a health hazard of 

sufficient importance in the United 

States to warrant appropriate remedial 

action. Subsequently, Congress passed 

the Federal Cigarette Labeling and 

Advertising Act (FCLAA) of 1965 (Pub. 

L. 89–92); this legislation required that 

a printed warning appear on cigarette 

packages to warn consumers of the 

potential hazards of cigarette smoking. 

This warning requirement was modified 

by later amendments to FCLAA, 

including the Comprehensive Smoking 

Education Act (CSEA) of 1984 (Pub. L. 

98–474), which extended the warning 

requirement to cigarette advertising. The 

current requirements for cigarette 

package and advertising warning 

statements are set forth in FCLAA. 

Although FCLAA has required the 

inclusion of textual health warnings on 

cigarette packages and in cigarette 

advertisements for many years, there is 

considerable evidence that the current 

warnings are given little attention or 

consideration by viewers (Id. at p. 168). 

These warnings, which have not 

changed in over twenty-five years, have 

been described as ‘‘invisible’’ and fail to 

convey relevant information in an 

effective way (Ref. 4; Ref. 5 at p. 291). 

The current warnings also fail to 

include any graphic component. In 

proposing this current regulation, FDA 

examined the scientific literature and 

found substantial evidence indicating 

that prominent warnings including a 

graphic component would offer 

significant public health benefits over 

the current warnings used in the United 

States (see Section III). FDA also found 

evidence of a strong worldwide 

consensus that effective tobacco health 

warnings should be large and should 

include a graphic image component. For 

example, the World Health 

Organization’s (WHO) Framework 

Convention on Tobacco Control 

(FCTC),3 an evidence-based treaty that 

provides a regulatory strategy for 

addressing the serious negative impacts 

of tobacco products, calls for warnings 

that are rotating, ‘‘large, clear, visible 

and legible.’’ The treaty recommends 

that the warnings occupy 50 percent or 

more of the principal display areas, and 

states that they may be in the form of 

or include pictures or pictograms. WHO 

FCTC art. 11.1(b). Worldwide, over 30 

countries/jurisdictions have 

implemented pictorial warnings on 

tobacco packages and requirements for 

pictorial warnings are pending in 

several other countries/jurisdictions.4


emcdonald on DSK2BSOYB1PROD with PROPOSALS2
69526 Federal Register / Vol. 75, No. 218 / Friday, November 12, 2010 / Proposed Rules 

Latvia; Malaysia; Mauritius; Mexico; Mongolia; 

New Zealand; Pakistan; Panama; Paraguay; Peru; 

Romania; Singapore; Switzerland; Taiwan; 

Thailand; Turkey; United Kingdom; Uruguay; and 

Venezuela. Countries/jurisdictions with pending 

requirements include: France; Guernsey, Honduras; 

Malta; Norway; Philippines; and Spain. 

Therefore, as directed by section 201 

of the Tobacco Control Act, and in the 

interest of the public health, we are 

proposing to modify the required 

warnings that appear on cigarette 

packages and in cigarette 

advertisements to include color graphics 

depicting the negative health 

consequences of smoking. Specifically, 

we are proposing to add a new part 1141 

to Title 21 of the Code of Federal 

Regulations, which would require new 

warnings on cigarette packages and in 

cigarette advertisements. These new 

required warnings would consist of the 

nine textual warning statements set 

forth in section 201 of the Tobacco 

Control Act accompanied by color 

graphics depicting the negative health 

consequences of smoking. As required 

by section 201 of the Tobacco Control 

Act, the new warnings would appear 

prominently on packages and in 

advertisements, occupying at least 50 

percent of the area of the front and rear 

panels of cigarette packages and 20 

percent of the area of advertisements. 

Under sections 201 and 202 of the 

Tobacco Control Act, FDA may adjust 

the type size, text, and format of the 

textual warning statements. For 

example, under section 4(d) of FCLAA 

(as amended by section 201 of the 

Tobacco Control Act), FDA may adjust 

the type size, text, and format as FDA 

determines appropriate so that both the 

textual warning statements and the 

accompanying graphics are clear, 

conspicuous, legible and appear within 

the specified area. Such adjustments, 

including adjustments to the text of 

some of the textual warning statements, 

are included for some of the new 

warnings FDA is proposing. 

These proposed modifications to the 

warnings currently required in the 

United States would promote greater 

public knowledge of the health risks of 

using cigarettes and would help reduce 

the initiation of smoking and the 

prevalence of cigarette use among 

Americans, and thus help prevent the 

life-threatening health risks posed by 

cigarettes. Specifically, the new 

required warnings are designed to 

clearly and effectively convey the 

negative health consequences of 

smoking on cigarette packages and in 

cigarette advertisements, which would 

help both to discourage nonsmokers, 

including minor children, from 

initiating cigarette use and to encourage 

current smokers to consider cessation to 

greatly reduce the serious risks that 

smoking poses to their health. 

II. Cigarette Use in the United States 

and the Resulting Health Consequences 

In the United States, cigarette 

smoking is the leading cause of 

preventable death and disease (Ref. 6), 

resulting in more deaths each year than 

AIDS, alcohol, illegal drug use, 

homicide, suicide, and motor vehicle 

crashes combined (Ref. 7). Each day, an 

estimated 6,600 Americans (nearly 

4,000 of them under the age of 18) 

become new smokers (Ref. 8 at p. 59), 

and due to the highly addictive nature 

of cigarettes, many will find it difficult 

to quit smoking, despite the severe 

health risks associated with cigarette 

use. Most smokers begin smoking before 

they are 18 years old (Ref. 3 at p. 6)— 

more than 80 percent of established 

adult smokers began smoking before age 

18 (Ref. 9)—and about half of 

adolescents who continue to regularly 

smoke will eventually die from 

smoking-attributable disease (Ref. 10). 

Smoking causes at least 443,000 

premature deaths annually in the 

United States, and each year cigarettes 

are responsible for approximately 5.1 

million years of potential life lost, direct 

health care expenditures of 

approximately $96 billion, and at least 

$96.8 billion in annual productivity 

losses in the United States (Ref. 1). The 

public health benefits that would result 

from reducing the number of Americans 

who smoke, and thus preventing the 

life-threatening consequences associated 

with cigarette use, are substantial. 

A. Smoking Prevalence Among Adults 

and Children 

Adults. A significant percentage of 

U.S. adults are cigarette smokers. For 

example, results from the 2009 National 

Health Interview Survey (NHIS) indicate 

that approximately 46.6 million U.S. 

adults (or 20.6 percent of the adult 

population) are cigarette smokers (Ref. 

6). Among these adult smokers, the vast 

majority—78.1 percent, or 

approximately 36.4 million people— 

smoke every day (Id.). There are also 

subsets of the adult population with 

smoking prevalence rates that are 

significantly higher than the overall 

average. For example, the highest 

prevalence rates have been observed in 

adults with low education levels. Data 

indicate that 49.1 percent of adults with 

a General Education Development 

certificate (GED) and 28.5 percent of 

adults with less than a high school 

diploma were current smokers in 2009, 

compared with 5.6 percent of adults 

with a graduate degree (Id.). 

Children. Among children, data from 

the 2009 Youth Risk Behavior Survey 

(YRBS), a nationally representative 

survey of students in grades 9–12 in the 

United States, showed that almost half 

(46.3 percent) of U.S. high school 

students had tried cigarette smoking, 

and an estimated 19.5 percent of 

students were current cigarette smokers 

(Ref. 11 at p. 10). Of these current 

cigarette smokers, 7.8 percent reported 

that they had smoked more than 10 

cigarettes per day on the days they 

smoked (Id. at p. 11). Overall, 

approximately 7.3 percent of high 

school students in 2009 were frequent 

cigarette users, and 11.2 percent of 

students under the age of 18 had been 

daily smokers at some point during their 

lifetime (Id. at pp. 10–11). Furthermore, 

follow-up studies of youth smokers have 

indicated that a significant number of 

students who are light smokers (i.e., 

students who are not daily smokers or 

who smoke less than 10 cigarettes per 

day) in high school will become heavy 

smokers after leaving high school (Ref. 

12). 

Trends. During the period of 1998– 

2009, the proportion of U.S. adults who 

were current cigarette smokers declined 

from 24.1 percent to 20.6 percent. 

However, the proportion did not decline 

from 2008 to 2009 (20.6 percent in both 

years), and during the five-year period 

of 2005 to 2009, rates showed virtually 

no change (20.9 percent in 2005 and 

20.6 percent in 2009) (Ref. 6). 

For children, data from the YRBS 

show that smoking prevalence rates 

increased rapidly in the early 1990s, 

peaking around 1997. Prevalence then 

declined during the late 1990s, but the 

rate of decline slowed during 2003– 

2009 (Ref. 13). According to 2009 data 

from the University of Michigan’s 

Monitoring the Future survey, cigarette 

smoking rates among 8th, 10th, and 12th 

grade U.S. students declined only 

slightly from 2007 to 2009, at a much 

slower pace than observed previously. 

Specifically, over the two-year time 

period from 2007 to 2009, smoking 

prevalence fell by just 0.6, 0.9 and 1.5 

percentage points among 8th, 10th, and 

12th graders, respectively (Ref. 12). Data 

from this survey also indicate that the 

proportion of students who perceive a 

great risk associated with being a 

smoker has leveled off in the past 

several years (Id.). 

B. Initiation of Smoking Among Adults 

and Children 

As discussed in section II.A, roughly 

one-fifth of Americans are current 

cigarette smokers. Although the 

cigarette industry regularly loses 

customers through user cessation and 


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Federal Register / Vol. 75, No. 218 / Friday, November 12, 2010 / Proposed Rules 69527 

through deaths caused by smoking, each 

year millions of U.S. adults and 

children become new smokers. 

For example, results from the 2008 

National Survey on Drug Use and 

Health (NSDUH) indicate that the 

number of persons aged 12 or older who 

smoked cigarettes for the first time 

within the past 12 months was 2.4 

million (Ref. 8 at p. 59). This estimate 

was similar to the 2007 estimate (2.2 

million) but statistically significantly 

higher than the estimates for 2002 (1.9 

million), 2003 (2.0 million) and 2004 

(2.1 million) (Id.). This 2008 estimate 

averages out to approximately 6,600 

new cigarette smokers every day (Id.). 

Most of these new cigarette smokers 

(nearly 4,000) were under the age of 18 

(Id.). However, it is also notable that the 

number of people who began smoking at 

age 18 or older showed a significant 

increase over the last several years, 

jumping from approximately 600,000 in 

2002 to 1 million in 2008 (Id. at p. 60). 

In addition, data from the 2008 

NSDUH indicate that almost 1 million 

Americans aged 12 or older had started 

smoking cigarettes daily within the past 

12 months. Of these new daily smokers, 

37.2 percent (350,000 persons) were 

younger than age 18 when they started 

smoking daily. In other words, each day 

in 2008 approximately 1,000 U.S. 

children became new daily smokers 

(Id.). This is particularly concerning 

from a public health perspective, as 

studies suggest that the age individuals 

begin smoking can greatly influence 

how much they smoke per day and how 

long they smoke, which will ultimately 

influence their risk of tobacco-related 

disease and death (Refs. 14 through 16). 

Data from animal studies also suggest 

that nicotine can cause permanent brain 

changes in the adolescent brain that 

lead to addiction and that these changes 

are greater in adolescents than in adults 

(Ref. 17). Furthermore, data from human 

studies indicate that the younger 

smokers start, the more likely they are 

to become addicted (Id.). 

C. Costs to Society and Health Effects of 

Cigarettes 

Cigarettes are responsible for 

premature deaths from a variety of 

diseases, a substantial burden on the 

U.S. healthcare system, and significant 

economic losses to society (Ref. 1). 

Smoking is the primary causal factor for 

at least 30 percent of deaths from 

cancer, including 90 percent of deaths 

from lung cancer, almost 80 percent of 

deaths from chronic obstructive 

pulmonary disease (COPD), and nearly 

one-fifth of all deaths from 

cardiovascular disease (Ref. 1 and Ref. 

2 at pp. 39 and 43). 

1. Costs of Smoking to Society 

Data from the Centers for Disease 

Control and Prevention’s (CDC) 

Smoking-Attributable Mortality, 

Morbidity, and Economic Costs 

(SAMMEC) system for 2000–2004, the 

most recent years for which analyses are 

available, indicate that cigarette 

smoking and exposure to cigarette 

smoke are responsible for at least 

443,000 premature deaths each year 

(Ref. 1). For every person who dies from 

smoking, approximately 20 more people 

(8.6 million persons) suffer from at least 

one serious smoking-related illness, 

primarily heart disease and COPD (Ref. 

18). The three leading causes of 

smoking-attributable death for current 

and former smokers were lung cancer, 

ischemic heart disease, and COPD (Ref. 

1). Cigarettes also have significant 

deleterious effects on nonsmokers. For 

example, maternal smoking during 

pregnancy resulted in an estimated 776 

infant deaths annually during 2000– 

2004, and each year an estimated 49,400 

lung cancer and heart disease deaths 

were attributable to exposure to 

secondhand smoke (Id.). 

Overall, each year cigarettes are 

responsible for approximately 5.1 

million years of potential life lost, direct 

health care expenditures of 

approximately $96 billion, and at least 

$96.8 billion in productivity losses due 

to premature deaths in the United States 

(Id.). The total costs of smoking to 

society are much higher, as this estimate 

of productivity losses does not include 

costs associated with smoking-related 

disability, employee absenteeism, or 

costs associated with secondhandsmoke attributable disease morbidity 

and mortality (Id.). These health care 

expenditures and productivity losses 

result in a combined economic burden 

from cigarette smoking of approximately 

$193 billion per year (Id.). There are 

also costs to the smoker and his or her 

family. One study estimated that the 

total cost of smoking over a lifetime, 

including private costs to the smoker 

and costs imposed on society (e.g., 

second hand-smoke and costs of 

Medicare, Medicaid, and Social 

Security) come to nearly $40 per pack 

of cigarettes smoked (Ref. 19 at p. 11). 

2. Negative Health Effects of Cigarettes 

The healthcare burdens, productivity 

losses, and deaths attributed to smoking 

are related to an array of diseases and 

health conditions caused by cigarettes. 

Beginning with the landmark 1964 

report ‘‘Smoking and Health,’’ the U.S. 

Surgeon General has issued a series of 

reports addressing the health 

consequences of smoking and nicotine 

addiction. According to the most recent 

Surgeon General’s Report, ‘‘The Health 

Consequences of Smoking,’’ which 

summarizes thousands of peer-reviewed 

scientific studies and is itself peerreviewed, smoking remains the leading 

preventable cause of death in the United 

States, and cigarettes have been shown 

to cause an ever-expanding number of 

diseases and health conditions (Ref. 2 at 

pp. 9 and 25). As stated in the 2004 

Report, ‘‘[s]moking harms nearly every 

organ of the body, causing many 

diseases and reducing the health of 

smokers in general * * * [and] 

[q]uitting smoking has immediate as 

well as long-term benefits, reducing 

risks for diseases caused by smoking 

and improving health in general’’ (Id. at 

p. 25). The following discussion 

presents a summary of some of the 

diseases and conditions caused by 

cigarettes, and of the impact smoking 

cessation has on some of these 

conditions. 

Cancer. Cigarette smoking has long 

been tied to a variety of cancers. For 

example, there is overwhelming 

evidence that smoking causes lung 

cancer, and that the worldwide 

epidemic of lung cancer is attributable 

largely to smoking (Id. at p. 43). Studies 

indicate that the risk for developing 

lung cancer can be 20 or more times 

higher for smokers compared to lifelong 

nonsmokers, and the risk of lung cancer 

increases in smokers with the duration 

of smoking and the number of cigarettes 

smoked (Id.). There are extensive data 

showing that quitting smoking decreases 

the risk of lung cancer, and that this risk 

continues to decline as the duration of 

not smoking increases in comparison to 

the risk among continuing smokers (Id. 

at p. 49). However, the risk does not 

decline to the level of risk for those who 

have never smoked, even after 15 to 20 

years of not smoking (Id. at p. 43). 

It also has been established for some 

time that cigarette smoking also causes 

a variety of other cancers, including 

laryngeal cancer, oral cavity and 

pharyngeal cancers, esophageal cancer, 

and bladder cancer (Id. at pp. 62, 67, 

116, and 167). Furthermore, smoking 

has also been shown to cause pancreatic 

cancer, kidney cancer, stomach cancer, 

cervical cancer, and acute myeloid 

leukemia (Id. at p. 25). 

For all of these cancers, increasing 

smoking prevention and cessation 

would cause a significant decrease in 

the risk (Id. at ch. 2). For example, 

smoking cessation halves the risk for 

cancers of the oral cavity and esophagus 

as soon as five years after cessation (Id. 

at p. 117). 

Cardiovascular disease. Smoking is 

causally related to all of the major 


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clinical cardiovascular diseases, with 

higher levels of smoking and longer 

duration of smoking increasing the risk 

of disease (Id. at p. 397). Heart disease 

and stroke are the main types of 

cardiovascular disease caused by 

smoking and represent the first and 

third leading causes of death in the 

United States (Id. at p. 363). Studies 

have shown that smokers have a 70 

percent greater death rate from coronary 

heart disease than nonsmokers, a 

twofold to fourfold greater incidence of 

coronary heart disease, and a twofold to 

fourfold greater risk of sudden death 

than nonsmokers (Ref. 20 at pp. 58–59). 

The beneficial impact of smoking 

cessation on these risks has also been 

well established. For example, one year 

after quitting smoking, a former 

smoker’s additional risk of heart disease 

compared to a person who has never 

smoked is reduced by about half and, 

after 15 years of abstinence, this risk is 

similar to that of a person who never 

smoked (Ref. 2 at p. 363). 

Current smoking is also associated 

with a twofold to fourfold increase in 

the risk of stroke; smoking cessation 

steadily decreases this risk and, after 5 

to 15 years of not smoking, the risk of 

stroke is indistinguishable from that for 

lifetime nonsmokers (Id. at p. 394). 

Smoking has also been shown to 

cause abdominal aortic aneurysm. 

Studies have shown that the risk of 

death from abdominal aortic aneurysm 

was increased more than fourfold in 

current smokers and twofold in former 

smokers; smoking is one of the few 

avoidable causes of this frequently fatal 

condition (Id. at pp. 396–97). 

Respiratory diseases. Smoking has 

negative effects on the entire lung—it 

impairs lung defenses against infection 

and causes the sustained lung injury 

that leads to COPD (Id. at p. 423). 

Cigarettes have been shown to cause a 

range of acute respiratory illnesses, 

including increased risk of pneumonia, 

and chronic respiratory diseases, which 

are leading causes of illness and death 

in the United States and worldwide (Id. 

at pp. 423, 508–509). 

For example, cigarette smoking is the 

leading cause of COPD in the United 

States, and this major public health 

problem could be almost completely 

prevented by smoking abstinence (Id. at 

p. 501). Although smoking cessation 

reduces the risk of COPD, the risk of 

COPD mortality among former smokers, 

even after 20 years or more of 

abstinence, remains elevated compared 

with the risk among people who have 

never smoked (Id.). 

Maternal smoking during pregnancy 

causes a reduction in lung function in 

infants, and children who smoke 

experience impaired lung growth and an 

early onset of lung function decline (Id. 

at pp. 508–509). Smoking during 

adulthood also leads to a premature 

onset of accelerated age-related decline 

in lung function, while smoking 

cessation can return the rate of lung 

function decline to that of persons who 

have never smoked (Id. at pp. 480 and 

509). Results from several investigations 

suggest that the benefits of smoking 

cessation for FEV1 decline (a measure of 

the air capacity of the lungs) are greatest 

for persons who stop smoking at 

younger ages (Id. at p. 480). 

Smoking also results in poor asthma 

control and it causes a range of 

respiratory symptoms in children, 

adolescents, and adults, including 

coughing, phlegm, wheezing, and 

shortness of breath (Id. at p. 509). 

Smoking cessation reduces the rates of 

these respiratory symptoms and of 

respiratory infections (Id. at p. 467). 

Reproductive effects. Smoking has 

well-documented negative effects on 

fertility, on pregnancies, and on infants 

and children born to women who 

smoke. For example, studies show that 

women who smoke have reduced 

fertility (Id. at p. 541). Women who 

smoke during pregnancy are more likely 

to experience premature rupture of the 

membranes, placenta previa, and 

placental abruption (Id. at p. 576). 

Smoking also increases rates of preterm 

delivery and shortened gestation, and 

studies have indicated that women who 

smoke are twice as likely to have low 

birth weight infants as women who do 

not smoke (Id. at pp. 576 and 569). 

Smoking also causes an increased risk of 

sudden infant death syndrome (SIDS) 

for infants whose mothers smoke during 

and after pregnancy (Id. at pp. 587 and 

601). 

Other effects. Smoking has been 

shown to have a variety of other 

negative health effects. For example, 

cigarette smokers have poorer overall 

health status compared to nonsmokers; 

this may manifest as increased 

absenteeism from work and increased 

use of medical care services (Id. at p. 

818). Smokers have an increased risk of 

adverse surgical outcomes related to 

wound healing and respiratory 

complications compared to nonsmokers 

(Id.). In postmenopausal women who 

smoke, smoking is associated with low 

bone density (Id. at p. 716). Smokers are 

also at an increased risk for hip 

fractures, which account for a 

significant proportion of the morbidity 

and mortality associated with 

osteoporosis (Id. at pp. 717–719). 

Smoking also increases the risk for 

periodontitis, cataract, and for the 

occurrence of peptic ulcer disease in 

persons who are Helicobacter pylori 

positive (Id. at pp. 736, 777, 780 and 

813). Furthermore, smokers are at a 

greater risk of dying from peptic ulcer 

disease than nonsmokers (Id. at p. 807). 

Addiction. Nicotine addiction is 

another negative effect of cigarette 

smoking. Nicotine is the primary 

chemical compound in tobacco that 

causes addiction, and the magnitude of 

public health harm caused by cigarettes 

is inextricably linked to the addictive 

nature of these products (Ref. 21 at 

p. 14; Ref. 5 at p. xi). Nicotine is 

psychoactive (mood altering) and can 

provide pleasurable effects; it also 

causes physical dependence 

characterized by withdrawal symptoms 

that usually accompany nicotine 

abstinence (Ref. 21 at p. 14). The 

pharmacologic and behavioral processes 

that determine tobacco addiction are 

similar to those that determine 

addiction to drugs such as heroin and 

cocaine (Id. at p. 9). Smokers develop 

tolerance to the effects of nicotine over 

time as well as a physical dependence 

on these effects, and as a result need 

greater amounts of nicotine over time to 

produce the same effects; thus smokers 

tend to smoke more over time to avoid 

withdrawal symptoms (Id. at pp. 50, 

197–98). Withdrawal symptoms are 

common among persons attempting to 

quit smoking—in one study, 78 percent 

of subjects reported significant 

withdrawal symptoms (Id. at pp. 201– 

202). 

In addition to physical dependence, 

nicotine addiction also results in 

conditioned behavior in smokers in 

response to situations and 

environmental stimuli associated with 

cigarette use. Smokers typically use 

cigarettes in certain patterns—e.g., upon 

waking in the morning, after a meal, 

with a cup of coffee or an alcoholic 

beverage—and this patterned behavior 

is strongly reinforced by the pleasurable 

effects of nicotine (Id. at pp. 306–308; 

Ref. 17). Other stimuli associated with 

smoking itself, such as the smell of 

cigarette smoke or the sight of cigaretteassociated paraphernalia, also become 

part of the conditioning process by 

repeated association with the desired 

physiological effects of nicotine (Ref. 21 

at p. 307; Ref. 17). As these processes 

repeat over time as a result of regular 

smoking, these situations and stimuli 

become a powerful cue to smoke due to 

their association with the rewarding 

effects of nicotine, and the desire to 

smoke triggered by these situations can 

persist long after withdrawal symptoms 

subside (Ref. 17). 

As a result of nicotine addiction, only 

a minority of smokers can achieve 

permanent abstinence in an initial quit 


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attempt. There are data suggesting that 

more than 70 percent of smokers in the 

United States report that they want to 

quit, and approximately 44 percent 

report that they try to quit each year 

(Ref. 19 at p. 15). This estimate is likely 

a significant underestimate of the actual 

number of quit attempts because 

unsuccessful quit attempts, particularly 

if short-lived or in the past, are often not 

reported in surveys. One study reported 

that at three months, 90.1 percent of 

quit attempts lasting less than one day, 

63.7 percent of those lasting between a 

day and one week, and 38.9 percent of 

those lasting between one week and one 

month failed to be reported to 

researchers conducting surveys (Ref. 

22). Many of the quit attempts that are 

reported are unsuccessful. For example, 

among the 19 million adults who 

reported attempting to quit in 2005, 

epidemiologic data suggest that only 4 

to 7 percent were successful (Ref. 19 at 

p. 15). Similarly, the Institute of 

Medicine (IOM), considering data for 

2004, found that although 

approximately 40.5 percent of adult 

smokers reported attempting to quit in 

that year, only between 3 and 5 percent 

were successful (Ref. 5 at p. 82). 

Furthermore, adults with education 

levels at or below the equivalent of a 

high school diploma have the highest 

smoking prevalence levels but the 

lowest quit ratios (i.e., the ratio of 

persons who have smoked at least 100 

cigarettes during their lifetime but do 

not currently smoke to persons who 

report smoking at least 100 cigarettes 

during their lifetime) (Ref. 23). 

Adolescents also experience low 

success rates when attempting to quit. 

Most Americans who use tobacco 

products begin using when they are 

under the age of 18 and become 

addicted before reaching the age of 18 

(Refs. 3 and 7). Although many 

adolescents believe ‘‘they can quit 

[smoking] at any time and therefore 

avoid addiction,’’ nicotine dependence 

can be rapidly established (Ref. 5 at p. 

89; see also Ref. 19 at p. 158). Research 

has shown that some adolescents report 

symptoms of withdrawal and craving 

within days or weeks of beginning to 

smoke (Ref. 24). As a result, many 

adolescents are nicotine dependent 

despite their relatively short smoking 

histories (Ref. 25). An analysis of data 

from the 2007 YRBS found that 60.9 

percent of high school students who 

ever smoked cigarettes daily tried to 

quit smoking, but only 12.2 percent 

were successful (Id.). Research among 

adolescents also highlights their poor 

understanding of the difficulty of 

quitting smoking—for example, one 

study found that only 3 percent of 12th 

grade daily smokers estimated that they 

would still be smoking in 5 years, while 

in reality 63 percent of this population 

is still smoking daily 7 to 9 years later 

(Ref. 5 at p. 91). 

Benefits of reduced prevalence. 

Dramatic declines in the deaths caused 

by the conditions discussed above can 

be achieved by further reducing 

smoking prevalence rates. Smoking 

cessation has major and immediate 

health benefits for men and women of 

all ages, regardless of health status (Ref. 

26 at p. i). Smoking cessation decreases 

the risk of the health consequences of 

smoking, and former smokers live 

longer than continuing smokers. For 

example, persons who quit smoking 

before age 50 have one-half the risk of 

dying in the next 15 years compared 

with continuing smokers (Id. at p. v). 

More importantly, preventing 

nonsmokers, particularly children, from 

starting smoking in the first instance 

would allow them to avoid nicotine 

addiction and the severe adverse health 

consequences of smoking. Preventing 

initiation would result in enormous 

public health benefits. As Congress 

found when enacting the Tobacco 

Control Act, ‘‘reducing the use of 

tobacco by minors by 50 percent would 

prevent well over 10,000,000 of today’s 

children from becoming regular, daily 

smokers, saving over 3,000,000 of them 

from premature death due to tobaccoinduced disease. Such a reduction in 

youth smoking would also result in 

approximately $75,000,000,000 in 

savings attributable to reduced health 

care costs’’ (section 2(14) of the Tobacco 

Control Act). 

III. Data Concerning Health Warnings 

A. Current Warnings on Cigarette 

Packages and Advertisements Are 

Inadequate 

Section 201 of the Tobacco Control 

Act requires FDA to issue regulations 

mandating the use of color graphics 

depicting the negative health 

consequences of smoking to accompany 

the nine warning statements that are 

specified in section 4(a)(1) of FCLAA 

(15 U.S.C. 1333(a)(1)). The warning 

statements must be randomly displayed 

(i.e., in each 12-month period, all of the 

different warnings must appear in as 

equal a number of times as is possible 

on each brand of the product and be 

randomly distributed in all areas of the 

United States in which the product is 

marketed) on cigarette packages and 

rotated quarterly in alternating sequence 

in cigarette advertisements, as provided 

by sections 4(c)(1) and 4(c)(2) of FCLAA 

(15 U.S.C. 1333(c)(1), (2)), as amended 

by the Tobacco Control Act. Congress 

directed that stronger and larger 

warning statements, accompanied by 

graphics, would replace the current textonly requirements. Data from studies 

indicate the current warnings on 

cigarette packages and advertisements 

are ineffective at communicating health 

risk information to consumers. 

Cigarette packages and advertisements 

can be effective channels for 

communication of important health 

information. The warning on a cigarette 

package can provide a clear, visible 

vehicle to communicate risk at the most 

crucial time for smokers and potential 

smokers. Pack-a-day smokers are 

potentially exposed to warnings more 

than 7,000 times per year (Refs. 27–29). 

When utilized effectively, cigarette 

packages and advertisements can serve 

as an important channel for 

communicating health information to 

broad national audiences that include 

both smokers and nonsmokers. 

The inclusion of strong health 

warnings on packages and in 

advertisements can thus provide a 

critical opportunity to educate 

consumers about the health risks of 

cigarettes, support intentions among 

current smokers who want to quit or 

decrease cigarette consumption, and 

discourage nonsmokers, particularly 

youth, from initiating cigarette use. 

Prominent displays of warnings increase 

their effectiveness; larger warnings, with 

pictures, are more likely to be noticed 

by consumers, communicate 

information about health risks to 

consumers, and reinforce intentions 

among tobacco users who want to quit 

(Ref. 30). 

However, cigarette warnings in the 

United States have not been changed or 

improved in more than 25 years. The 

unchanging nature of these warnings, as 

well as their relatively small size and 

lack of a graphic image component, 

severely impairs their ability to 

effectively communicate to consumers. 

Research has repeatedly illustrated that 

the current warnings used in the United 

States frequently go unnoticed or fail to 

convey relevant information regarding 

health risks. 

1. Current Warnings Have Not Changed 

in More Than Twenty-Five Years 

In response to the Surgeon General’s 

first major report on smoking and health 

in 1964, Congress passed FCLAA to 

require warning labels on all cigarette 

packages. The warning, which was 

required to be conspicuous and legible, 

was written in small print and located 

on one of the side panels of each 

cigarette package. It stated ‘‘CAUTION: 

Cigarette Smoking May Be Hazardous to 


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5Slightly different health warnings were required 

on outdoor billboard advertisements. 

Your Health.’’ This language appeared 

on all cigarette packs sold from January 

1, 1966, through October 31, 1970. In 

1969, Congress passed the Public Health 

Cigarette Smoking Act (Public Law 91– 

222), which slightly modified the 

warning statement on cigarette 

packages, but did not yet require any 

warnings on cigarette advertisements. 

The new warning language, ‘‘Warning: 

The Surgeon General Has Determined 

That Cigarette Smoking Is Dangerous to 

Health,’’ appeared on cigarette packages 

sold in the United States from 

November 1, 1970, through October 11, 

1985. In 1972, the Federal Trade 

Commission (FTC) issued consent 

orders requiring six major cigarette 

manufacturers and distributors to 

include in all their cigarette 

advertisements a clear and conspicuous 

disclosure of the warning required to be 

on packages (Ref. 31 at 460–65). 

In 1981, the FTC issued a report to 

Congress that concluded that the thencurrent health warning labels had little 

effect on public awareness and attitudes 

toward smoking. The FTC stated that 

the existing warning likely was 

ineffective because it ‘‘(1) is overexposed 

and worn out, (2) lacks novelty, (3) is 

too abstract, and (4) lacks personal 

relevance’’ (Ref. 32 at pp. 7–16). 

Subsequently, Congress again 

modified cigarette warnings by passing 

the CSEA, which required the following 

four rotational health warnings on 

packages and advertisements 5: 

• ‘‘SURGEON GENERAL’S 

WARNING: Smoking Causes Lung 

Cancer, Heart Disease, Emphysema, and 

May Complicate Pregnancy.’’ 

• ‘‘SURGEON GENERAL’S 

WARNING: Quitting Smoking Now 

Greatly Reduces Serious Risks to Your 

Health.’’ 

• ‘‘SURGEON GENERAL’S 

WARNING: Smoking by Pregnant 

Women May Result in Fetal Injury, 

Premature Birth and Low Birth Weight.’’ 

• ‘‘SURGEON GENERAL’S 

WARNING: Cigarette Smoke Contains 

Carbon Monoxide.’’ 

In addition, the law established the 

location and format for these warning 

statements and mandated that the 

warnings be rotated quarterly, which 

helped keep them from becoming stale. 

Despite a FTC recommendation to 

change the size and shape of warnings, 

Congress retained the size and 

rectangular format of previous warnings. 

More than twenty-five years have 

passed since these last changes, and 

there is a substantial body of evidence 

that these warnings do not effectively 

communicate information about the 

adverse health effects of smoking to the 

American public, as discussed in more 

detail below. Given the extreme hazards 

cigarettes pose to the public health, the 

revised warnings required under section 

4 of FCLAA (15 U.S.C. 1333) and 

provided in this proposed rule are 

critical to the effective communication 

of the health risks of smoking, and 

should encourage current smokers to 

consider cessation and discourage 

nonsmokers from initiating use of 

cigarettes. 

2. Current Warnings Often Go 

Unnoticed 

The CSEA requires the current 

warnings to be ‘‘conspicuous and 

legible’’ with the same package location 

and font size required on the date of 

enactment (i.e., October 12, 1984). 

However, researchers have found that 

these health warnings go largely 

unnoticed and unconsidered by both 

smokers and nonsmokers. For example, 

a major study into tobacco policy in the 

United States by the IOM in 2007 

concluded that U.S. package warnings 

are both ‘‘unnoticed and stale’’ (Ref. 5 at 

p. 291). The Chair of the IOM’s 

Committee on Reducing Tobacco Use 

has described the warnings on cigarette 

packs as ‘‘invisible’’ (Ref. 4). 

Research regarding warning 

statements in cigarette advertisements 

has shown similar results. For example, 

one study of the recall and eye-tracking 

of adolescents viewing tobacco 

advertisements found: 43.6 percent of 

adolescents did not even look at the 

warning statement included in the 

advertisement; just 36.7 percent looked 

at the warning long enough to read any 

of its words; and the average viewing of 

the warning only accounted for 8 

percent of the total viewing time (Ref. 

33). Researchers in this study also 

determined that adolescents are unable 

to recall the content of the current 

cigarette warnings or to correctly 

recognize the warnings from a list, 

indicating that the current warnings are 

likely to be ineffective among younger 

consumers (Id.). 

Another study of adolescents also 

found that they are not seeing, reading, 

and remembering health warnings on 

cigarette packages and advertisements 

(Ref. 34). In this study of ninth-grade 

students, only 32 percent of regular 

smokers recalled seeing one of the 

current warnings which states: ‘‘Quitting 

Smoking Now Greatly Reduces Serious 

Risks To Your Health’’ (Id.). In addition, 

almost 20 percent incorrectly reported 

having seen a simulated health warning 

that is not among one of the four current 

required warnings (Id.). 

Data from a 1989 study indicate that 

consumers also fail to notice or read 

health warnings on outdoor billboards 

and taxicab cigarette advertisements 

(though these advertising media are no 

longer in common use). According to 

this study, which was published in the 

Journal of the American Medical 

Association, drivers only read the entire 

warning message on 5 percent of 

highway billboard advertisements and 

were only able to fully read the health 

warning on 18 of the 39 street 

advertisements used in this study (Ref. 

35). Participants were unable to read, 

even partially, the Surgeon General’s 

warnings in any of the 47 taxicab 

advertisements used in this study (Id.). 

Yet, those same consumers were able to 

identify the brand name and imagery on 

100 percent of the highway billboards 

(Id.). Likewise, these participants were 

able to identify the brand name in 100 

percent and the imagery in 95 percent 

of the taxicab advertisements (Id.). 

These results indicate that the current 

warnings are not appropriately 

conspicuous in advertisements 

compared to the rest of the advertising 

message, as discussed in more detail 

below. 

3. Current Warnings Fail To Convey 

Relevant Information in an Effective 

Manner 

Even when consumers notice and 

contemplate the current health warnings 

on cigarette packages and in 

advertisements, there is clear evidence 

that these warnings fail to appropriately 

convey crucial information such as the 

nature and extent of the health risks 

associated with smoking cigarettes. The 

current small, wordy text-based 

messages are ambiguous, providing less 

health information than is provided 

regarding many other consumer goods 

that have significantly less harmful 

impact on people’s health (Ref. 36). 

In its 2007 Report, the IOM concluded 

that the current U.S. warnings fail to 

convey relevant health information in 

an effective way (Ref. 5 at p. 291). The 

IOM cited an International Tobacco 

Control Policy Evaluation Study, which 

found that 85 percent of Canadian 

respondents cited packages (which, in 

Canada, contain prominent text and 

graphic health warnings) as a source of 

health information, while only 47 

percent of U.S. smokers cited packages 

as a health information source (Id. at 

294, citing Ref. 37). 

Studies also have shown that the 

current warnings do not motivate 

consumers to look at them long enough 

to consider the concept being 

communicated. For example, 

researchers have found that the warning 


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statements fail to attract attention or to 

make the consumer appropriately aware 

of the health risks of smoking (Ref. 38). 

In a study of U.S. and Canadian smokers 

and nonsmokers, researchers found that 

participants voluntarily examined 

warnings on Canadian packages, which 

include prominent text and graphics, for 

longer durations than U.S. package 

warnings, because the current text-only 

messages used in the United States are 

not memorable for consumers (Id.). The 

mere textual presentation of vague 

hazard information in the current U.S. 

warnings is not sufficient to motivate 

perceptions of risk (Id.). 

The content and format of the current 

warnings have failed to successfully 

draw and hold consumers’ attention, 

especially when placed in competition 

with the other text, images, and graphics 

that cigarette companies have used on 

packaging and in advertising, which 

have been thoroughly tested, regularly 

updated, and artfully crafted by tobacco 

companies. According to the most 

recent data from the FTC, tobacco 

companies spent approximately $12.49 

billion on advertising and promotion in 

2006 (Ref. 39 at p. 1). Tobacco 

companies frequently have employed 

marketing and advertising experts to 

craft campaigns with messages targeted 

to certain demographics (Ref. 40 at p. 7). 

The messages developed by companies 

in cigarette advertisements cover 96 

percent of the space, are continuously 

updated to incorporate current trends, 

and are targeted based on market 

research. In contrast, the current health 

warnings cover only 4 percent of 

advertising space, are solely textual, are 

not targeted to any population group, 

and consist of only four rotating 

messages that have not been updated for 

more than two and a half decades. On 

cigarette packages, these warnings 

appear only on one side panel. As a 

result, the important health messages 

frequently are functionally invisible in 

comparison to the rest of the 

advertisement and package (Ref. 33 at p. 

88). 

Moreover, even if consumers notice 

the current warnings, those with less 

education may not be able to adequately 

comprehend the text-only messages. In 

its 2007 Report, the IOM expressed 

concern about the ability of consumers 

with less education to recall the 

information included in text-based 

messages (Ref. 5 at p. 295). The IOM 

cited a study of Canadian smokers’ 

knowledge about the country’s prior 

warning requirements, which, like the 

current U.S. health warnings, only 

contained four textual warning 

statements. In that study, researchers 

noted that comparatively few women 

with lower educational attainment were 

aware of messages warning of the 

impacts of smoking on life expectancy, 

heart disease, or pregnancy (Ref. 41). 

Because the current U.S. smoking 

population has various levels of 

education (including a high percentage 

of people with low educational 

attainment) and includes teenagers (who 

have yet to complete their education), 

the current text-only warnings are 

inadequate. 

B. Larger, Graphic Warnings 

Communicate More Effectively: 

International Experience 

In 2001, Canada introduced graphic 

health warnings depicting the adverse 

health consequences of smoking on the 

upper 50 percent of the two primary 

panels of cigarette packages. Those 

warnings, like the warnings proposed 

here, include a photograph or other 

image, a marker word ‘‘WARNING,’’ and 

a warning statement. By mid-2009, 28 

countries also required graphic 

warnings and more countries are 

planning to do so. 

In its 2007 Report, the IOM concludes 

that the available scientific evidence 

indicates that larger, graphic health 

warnings would promote greater public 

knowledge of the health risks of using 

tobacco and would help reduce 

consumption (Ref. 5 at p. 295). 

Similarly, an article published by WHO 

concludes that, taken as a whole, the 

research on graphic health warnings 

show that they are (1) more likely to be 

noticed than text-only warnings, (2) 

more effective for educating smokers 

about the health risks of smoking and 

for increasing the time smokers spend 

thinking about the health risks, and (3) 

associated with increased motivation to 

quit smoking (Ref. 42). 

1. Getting Consumers’ Attention 

Several design features are associated 

with greater salience (i.e., noticeability 

and readability) of health warnings, 

including the size and position of 

warnings on the cigarette package. 

Smokers are more likely to recall larger 

warnings, as well as warnings that 

appear on the front of packages (Ref. 5 

at p. C–3). Warnings that include 

pictures or graphics likewise are more 

noticeable and more likely to be recalled 

than text-only warnings (Id. at p. C–4). 

In Canada, awareness of warnings on 

cigarette packages was almost universal 

among smokers and very high even 

among nonsmokers after that country 

required cigarette packages to display 

large, graphic warnings on the front and 

rear panels. In a 2001 cross-sectional 

survey sponsored by the Canadian 

Cancer Society, 90 percent of Canadian 

smokers and 49 percent of nonsmokers 

noticed changes to the Canadian health 

warnings after the introduction of 

pictorial warnings (Ref. 43). Similarly, a 

survey of youth sponsored by Health 

Canada showed that 73 percent of those 

who have never smoked, 86 percent of 

‘‘puffers’’ (i.e., those who had tried 

smoking but never smoked a whole 

cigarette), and 90 percent of those who 

have smoked beyond puffing reported 

seeing health warnings on cigarette 

packages in 2002, a year after the 

introduction of graphic warnings in 

Canada (Ref. 44). In a study of young 

adults, 98.5 percent of smokers, 88.9 

percent of occasional smokers, and 67.5 

percent of those who have never 

smoked reported that they were aware 

of the Canadian graphic health warnings 

(Ref. 45). 

Survey evidence also shows that 

awareness of health warnings on 

cigarette packages increased 

significantly after Australia required 

large, graphic warnings in 2006. In one 

study, smokers were more likely to 

report that over the past month they 

noticed the enhanced warnings and read 

or looked closely at them compared to 

the old warnings (Ref. 46). Among 

students in year levels 8 to 12 in 

Melbourne, cognitive processing of 

cigarette warnings (i.e., reading, 

attending to, thinking and talking about 

the warnings) increased in the year that 

Australia adopted graphic warnings 

(Ref. 47). Developmental focus group 

research conducted for Australia as it 

considered whether to require graphic 

warnings similarly reported that graphic 

warnings on cigarette packs were 

potentially more likely to help people 

remember the health effects and 

warnings (Ref. 48). 

Experimental studies also indicate 

that requiring large, graphic warnings 

would significantly increase the 

salience of health warnings on cigarette 

packages. In one experimental study, 

U.S. college students were shown 

images of the Canadian cigarette 

warnings and the current warnings 

appearing on cigarette packs sold in the 

United States. Compared to the U.S. 

warnings, the Canadian graphic 

warnings significantly increased aided 

recall of the warnings, increased depth 

of message processing, and increased 

the perceived strength of the message 

(Ref. 49). Similarly, in focus group 

research conducted among young adults 

in the United States, participants 

reported that the Canadian warnings 

were more visible and more informative 

than the warnings appearing on 

cigarette packages in the United States 

(Ref. 50). 


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2. Influencing Consumers’ Awareness of 

Cigarette-Related Health Risks 

Large, pictorial warnings graphically 

convey the harm and danger that 

tobacco use causes, eliciting an 

immediate impact. Effective 

communication of the health risks 

associated with cigarette use is critical 

from a public health perspective, as 

smokers who perceive a greater health 

risk from smoking are more likely to 

want to quit and to be successful in 

their quit attempts (Ref. 37). National 

surveys conducted on behalf of Health 

Canada indicate that approximately 95 

percent of youth smokers and 75 

percent of adult smokers report that the 

Canadian pictorial warnings have been 

effective in providing them with 

important health information (Ref. 5 at 

p. 294). The 2001 survey conducted by 

the Canadian Cancer Society found that 

the country’s pictorial warnings, which 

had recently been introduced, resulted 

in 58 percent of smokers reporting that 

they thought about the health effects of 

smoking more frequently than 

previously (Ref. 43). Among Canadian 

adult smokers in Ontario, 51 percent of 

study participants reported that the 

pictorial warnings made them think 

about the health effects of smoking (Ref. 

51). Canadian smokers were more likely 

to report cigarette packages as a source 

of information about the health risks of 

smoking than smokers in the United 

States and other countries with textonly warnings (Ref. 37). 

Similarly, a study conducted for 

officials in Australia found that graphic 

warnings increased participants’ 

knowledge and awareness of the health 

risks of smoking, especially among 

current smokers and recent quitters (Ref. 

52). A street intercept study in Australia 

suggests that graphic warnings may also 

increase smokers’ perceptions of their 

personal risks of smoking. In that study, 

51 percent of participants stated that the 

graphic warnings on cigarette packs 

increased their perceived risk of dying 

from smoking (Ref. 53). 

Graphic warnings appear to influence 

risk perceptions among youth as well as 

adults. In a cross-sectional survey of 

middle and high school students in 

Greece, participants were shown several 

graphic warnings prepared by the 

European Union as well as text-only 

warnings. Study participants 

consistently selected the graphic 

warnings as more effective in making 

them think about the effects of smoking 

on health (Ref. 54). Similarly, in a youth 

survey conducted by Health Canada, 

approximately two-thirds of youth 

nonsmokers reported looking at the 

pictorial warnings at least once a week 

and, as indicated above, 95 percent 

agreed that the warnings had been 

effective in providing them with 

important information about the health 

effects of smoking (Ref. 5 at p. C–5). 

In an Internet-based study of current 

and former young adult smokers in the 

United States, the Canadian graphic 

warnings were rated as significantly 

more effective than the current U.S. 

warnings on cigarette packs for 

conveying concerns about the health 

risks of smoking (Ref. 55). 

3. Impacting Smoking Intentions and 

Behaviors 

In addition to increasing consumer 

awareness of the health risks of 

smoking, the proposed graphic warnings 

also seek to impact changes in smoking 

behavior. There are some studies 

indicating that large, graphic warnings 

increase smokers’ intentions to quit 

smoking or motivate them to quit 

smoking. 

The 2001 survey sponsored by the 

Canadian Cancer Society shows that 44 

percent of adult smokers stated that the 

Canadian graphic health warnings 

increased their motivation to quit 

smoking (Ref. 43). In another study of 

Canadian young adults (ages 20 to 24), 

37 percent of male participants and 48 

percent of female participants reported 

that the warnings on cigarette packs led 

them to think about quitting smoking 

(Ref. 45). In this same study, 36 percent 

of male participants and 34 percent of 

female participants also indicated that 

the cigarette warnings might make 

young people less likely to start 

smoking. Some studies indicate that 

exposure to graphic warnings increases 

quit intentions among youth smokers as 

well. A study of Australian adolescents 

shows that experimental and 

established youth smokers thought more 

about quitting after the introduction of 

graphic warnings in Australia (Ref. 47). 

There is also evidence suggesting that 

graphic warnings may be more effective 

at preventing youth initiation than textonly warnings. For example, in a crosssectional survey of middle and high 

school students in Greece where 

participants were shown several graphic 

warnings prepared by the European 

Union as well as text-only warnings, the 

adolescents rated the graphic warning 

labels as more effective in preventing 

them from smoking (Ref. 54). 

A few studies also indicate that large 

graphic health warnings may increase 

quit attempts. In Canada, smokers who 

quit smoking after the introduction of 

graphic warnings were 2.78 times more 

likely to identify health warnings as a 

motivation for their quitting than former 

smokers who quit during the two years 

before graphic warnings appeared on 

Canadian cigarette packages (Ref. 29). In 

one Australian study, participants 

reported increased attempts to quit 

smoking after cigarette packs displayed 

graphic warnings, although there was no 

association with short-term quit success 

(Ref. 46). 

Some studies also indicate that large, 

graphic warnings may induce 

individual smokers to reduce 

consumption. The Canadian Cancer 

Society survey indicated that 21 percent 

of smokers reported that on one or more 

occasions they chose not to smoke a 

cigarette due to the warnings on 

cigarette packages (Ref. 43). The survey 

also indicated that 27 percent of 

participants reported that the then-new 

graphic warnings motivated them to 

smoke less inside their homes (Id.). In 

another study involving young adults in 

Canada, 22.6 percent of current male 

smokers and 26.6 percent of current 

female smokers reported that in the past 

month, noticing the warning on 

cigarette packages led them to decide 

not to have a cigarette (Ref. 45). In a 

study of Australian youth smoking 

behavior, adolescents who were 

experimenting with smoking or were 

established smokers indicated that they 

thought more about forgoing cigarettes 

after graphic warnings appeared on 

cigarette packages in 2006 (Ref. 47). 

One study suggests that graphic 

warnings may help persons who have 

quit smoking remain abstinent from 

smoking. In that study, 26 percent of 

former smokers in Canada reported that 

the then-new graphic warnings on 

cigarette packages helped them remain 

abstinent (Ref. 29). 

Canadian national survey data also 

suggest that graphic warnings may 

reduce smoking rates. Smoking 

prevalence among Canadians aged 15 or 

older dropped from 24 percent in 2000 

(before the graphic warnings were 

introduced) to 22 percent in 2001 and 

21 percent in 2002 (Ref. 56). It is not 

possible to draw a direct causal 

connection between the graphic 

warnings and these data because other 

smoking control initiatives, including 

an increase in the cigarette tax and new 

restrictions on public smoking also 

occurred during the same period. At the 

same time, however, these data are 

suggestive that large graphic warnings 

may reduce smoking consumption. 

After considering the available 

scientific evidence, the IOM concluded 

in its 2007 Report that ‘‘[o]n the basis of 

the evidence accumulated thus far, 

[larger,] graphic warnings of the kind 

required in Canada, Brazil and Thailand 

‘would promote greater public 

understanding of the risks’ of using 


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tobacco and would help reduce 

consumption’’ in the United States (Ref. 

5 at p. 295). 

C. Benefits of FDA’s Proposed Required 

Warnings 

FDA has carefully assessed the 

scientific literature studying the impact 

of graphic images on the salience (i.e., 

noticeability and readability) of 

warnings, on the effective 

communication of the health risks of 

smoking, and on changes to smoking 

behavior. Although much of the 

available research involved comparisons 

of warnings that differ in more than one 

aspect (i.e., text size, use of graphics, 

and number of images), the overall body 

of available research has illustrated that 

the use of large text, color graphics, and 

multiple rotating health statements will 

significantly improve the 

communication of the health risks of 

smoking to the general public in the 

United States and delay wear-out of 

these important health messages. 

Our assessment of the literature and 

our experience as a public health agency 

provide support for requiring that the 

nine textual warning statements listed 

in section 4(a)(1) of FCLAA (15 U.S.C. 

1333(a)(1)) appear on cigarette packages 

and in cigarette advertisements, and that 

each textual warning statement be 

accompanied by a specified color 

graphic image. It also supports the 

proposal that the required warnings 

should comprise the top 50 percent of 

the area of each of the front and rear 

panels of cigarette packages and 20 

percent of the area of cigarette 

advertisements in the United States in 

accordance with section 4 of FCLAA (15 

U.S.C. 1333(b)). The statute and this 

proposal is consistent with the 

international consensus reflected in the 

WHO’s Framework Convention on 

Tobacco Control, i.e., the proposed 

warnings would be rotating, large, clear, 

visible, and legible, and would occupy 

‘‘50 percent or more of the principal 

display areas’’ of packages. WHO FCTC 

art. 11.1(b). Further, we believe that the 

available evidence demonstrates that the 

addition of color graphics to the nine 

new textual warning statements would 

ensure that warnings on packages and in 

advertisements effectively provide 

critical information to consumers while 

continuing to afford tobacco 

manufacturers and retailers ample space 

(over 50 percent of packages and 80 

percent of advertisements) to convey 

other information regarding the product. 

1. The Addition of Graphic Images Will 

Have a Significant, Positive Impact on 

Public Health 

As summarized in section III.B, 

research on cigarette warnings with a 

graphic component has found that they 

are more effective in educating 

consumers about smoking risks than 

text-only warnings (Ref. 42), and are 

more likely to be effective in impacting 

smoking behaviors (Ref. 27). Moreover, 

the available scientific literature 

suggests that cigarette packages with 

larger, text-only warnings are inferior to 

cigarette warnings with a graphic 

component in both communicating 

health information and encouraging 

smoking cessation. 

For example, data comparing the 

Canadian graphic warnings and the 

United Kingdom (UK) text-only 

warnings, after the UK substantially 

increased the number and size of its 

warnings (from 6 warnings that covered 

6 percent of the front and back of 

cigarette packages to 16 warnings that 

covered 30 percent of the front and 40 

percent of the back of the packages), 

found that the Canadian pictorial 

warnings had a greater impact on 

smokers than the new UK warnings 

(Ref. 36). Specifically, data collected 2.5 

years after the implementation of the 

Canadian pictorial warnings and 2.5 

years after the implementation of the 

larger, text-only UK warnings found 

that, while the UK respondents reported 

greater levels of salience (i.e., noticing 

and reading the warnings) than 

Canadian smokers, Canadian smokers 

were significantly more likely to stop 

smoking a cigarette as a result of the 

graphic warnings and to report that the 

graphic warnings had led them to think 

about quitting. Canadian smokers also 

were significantly more likely than 

those in the UK to report that the 

warnings made them think about the 

health risks of smoking. 

Likewise, data comparing the impact 

of Australia’s graphic warnings 

(introduced in 2005) and the UK’s 

larger, text-only warnings showed 

similar support for the use of a graphic 

component (Ref. 46). Specifically, 

researchers found greater increases in 

the two strongest predictors of 

subsequent quitting—cognitive 

responses (i.e., thinking about the health 

risks of smoking) and foregoing 

cigarettes—after Australia introduced its 

graphic warnings than after the UK 

introduced its enhanced text-only 

warnings. This is especially noteworthy, 

given that when the border is taken into 

account, the graphic warnings on the 

front of the packages in Australia were 

smaller than the UK’s text-only 

warnings on the front of the packages. 

It is worth noting that the UK 

amended its Tobacco Products 

(Manufacture, Presentation and Sale) 

(Safety) regulations in 2007 to require 

graphic warnings to appear on all 

cigarette packages as of October 2009. 

Furthermore, although both text and 

graphic cigarette warnings are subject to 

wear-out over an extended period of 

time, research has shown that graphic 

warnings maintain their impact longer 

than text-only warnings. Approximately 

four years after the introduction of the 

16 Canadian graphic warnings, youth 

and adult smokers reported little or no 

decrease in their effectiveness (Ref. 42; 

Ref. 36; Ref. 5 at C–4). Similarly, the use 

of color graphics in the proposed 

required warnings, coupled with the 

increase in the number of rotating 

health statements required under 

section 4 of FCLAA (15 U.S.C. 1333) 

and this proposed rule from four to 

nine, will help ensure that the new 

cigarette health warnings being 

proposed will retain beneficial effects 

over time (Ref. 5 at C–4). 

2. The Revised Textual Statements Will 

Communicate More Effectively 

The proposed required warnings 

would also modify the textual warning 

statements currently required on 

cigarette packages and in 

advertisements. Section 201(a) of the 

Tobacco Control Act sets forth nine text 

statements that will replace the four 

statements currently required under 

FCLAA once any final rule becomes 

effective. These nine statements 

objectively communicate some of the 

major health risks associated with 

smoking in a more effective manner 

compared to the warning statements 

currently required in the United States. 

As the IOM explained, specific, 

unambiguous warnings (e.g., ‘‘cigarettes 

cause lung cancer’’) are more likely to be 

noticed and less likely to be discounted 

than vague warnings (e.g., ‘‘cigarettes are 

hazardous to your health’’), and 

warnings should target an appropriate 

literacy level (Id. at C–3). The new 

textual warning statements set forth in 

the Tobacco Control Act represent an 

improvement over the current warnings 

in that they are specific and 

unambiguous and they succinctly 

describe documented outcomes of 

cigarette use and exposure. For 

example, the vague warning that 

‘‘Cigarette Smoke Contains Carbon 

Monoxide’’ will no longer be used, and 

two of the longer warnings currently in 

use, ‘‘Smoking Causes Lung Cancer, 

Heart Disease, Emphysema, and May 

Complicate Pregnancy’’ and ‘‘Smoking 


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by Pregnant Women May Result in Fetal 

Injury, Premature Birth, and Low Birth 

Weight,’’ will be replaced with shorter, 

more readable statements (e.g., 

‘‘Cigarettes cause fatal lung disease,’’ 

‘‘Cigarettes cause cancer,’’ ‘‘Cigarettes 

cause strokes and heart disease,’’ 

‘‘Smoking during pregnancy can harm 

your baby,’’ and ‘‘Smoking can kill 

you’’). The proposed required warnings 

also will be easier to understand 

because of the addition of the graphic 

component (Id. at 295). 

Thus, the nine specific textual 

warning statements set forth in section 

201(a) of the Tobacco Control Act would 

effectively convey the major health risks 

of smoking, which will help discourage 

nonsmokers from initiating cigarette 

use, and encourage current smokers to 

consider cessation, particularly when 

combined with graphic images 

depicting the negative consequences of 

smoking. We intend to monitor the 

effects of these required warnings once 

they are put into use. In addition, there 

will continue to be social science 

research conducted regarding the 

relative efficacy of various required 

warnings. We will use the results of our 

monitoring and such research to 

determine whether any of the textual 

warning statements or accompanying 

graphic images should be revised in a 

future rulemaking. 

D. FDA’s Process for Development and 

Plan for Selection of the Required 

Warnings 

Section 4(d) of FCLAA (15 U.S.C. 

1333(d)), as amended by section 201 of 

the Tobacco Control Act, requires FDA 

to issue ‘‘regulations that require color 

graphics depicting the negative health 

consequences of smoking’’ to 

accompany the textual warning 

statements specified in section 4(a)(1) of 

FCLAA (15 U.S.C. 1333(a)(1)). In 

considering and developing appropriate 

color graphics to accompany the textual 

warning statements, FDA assessed the 

graphic warnings that other countries 

have required for tobacco products. In 

addition, FDA worked with various 

experts in the fields of health 

communications, marketing research, 

graphic design and advertising to 

develop the required warnings 

published with the proposed regulation. 

The proposed required warnings, 

consisting of the color graphics FDA 

developed and the textual warning 

statements, are available as electronic 

files in portable document format (PDF) 

in this docket and on FDA’s Web site at 

http://www.fda.gov/cigarettewarnings. 

For the final rule, the required warnings 

will be contained in documents titled 

‘‘Cigarette Required Warnings—English 

and Spanish’’ and ‘‘Cigarette Warnings— 

Other Foreign Language 

Advertisements,’’ as is further discussed 

in section IV.D. Drafts of these two 

documents are included in the docket as 

well. 

The set of required warnings available 

with this proposed rule encompasses a 

variety of themes and graphic 

techniques. The required warnings are 

designed to communicate risk 

information to a diverse range of 

audiences, including youth, young 

adults, and adults, and of smokers as 

well as potential smokers. The images in 

some of the required warnings are 

photographic while others are graphic 

illustrations. Some images are more 

visually disturbing than others. The 

fonts, typography, and layouts vary. 

FDA believes that the graphics in the 

proposed required warnings 

appropriately depict the negative health 

consequences of smoking. Further, FDA 

believes that these graphics are 

consistent with the types of pictorial 

warnings required or developed by 

other international governmental 

authorities, such as Canada, the 

European Union, and Australia, whose 

sets of warnings include a balance of 

images, some more visually disturbing 

than others. FDA also believes that 

including a varied set of warnings is 

consistent with the existing scientific 

literature concerning the effectiveness of 

graphic health warnings. 

The existing research shows that the 

effectiveness of health warnings in 

communicating the health risks of 

smoking may vary according to the 

audience, reflecting factors such as 

socioeconomic background, gender, age, 

and smoking status and behavior (Ref. 

57 at p. 22). A variety of health 

warnings facilitates better targeting of 

specific groups whose primary concerns 

about smoking tend to vary (Id. at p. 46). 

Specific issues that may make smoking 

desirable (or undesirable) for one group 

might be quite different for another 

group (Id. at p. 44). Similarly, using a 

variety of different warnings has been 

found to be significant in counteracting 

over-exposure and wear-out of health 

warnings (Id. at p. 46). In addition, in 

some cases, the strength of the content 

of the message is what determines its 

impact, while in other cases, peripheral 

factors, such as how and where the 

message is delivered and its visual 

impact are the most significant 

determinants (Id. at p. 28). In order to 

be effective with a broad audience, 

health warnings should be developed 

with these different factors in mind 

(Id.). 

The existing research indicates that a 

balanced set of graphic warnings that 

includes a range and variety of images 

is effective. For example, the use of 

health warnings with ‘‘frightening’’ or 

‘‘disturbing’’ tonal qualities appears 

effective (Id. at pp. 37–39). Consistent 

with this research, some of the images 

published with the proposed regulation 

are more ‘‘frightening’’ or visually 

disturbing than others. 

Research also indicates that other 

types of graphic warnings, including 

those that do not include ‘‘frightening’’ 

or ‘‘disturbing’’ imagery, can be effective 

(Ref. 52 at pp. 24–25). For example, 

graphic health warnings that convey the 

risks of secondhand smoke for babies 

and children without being 

‘‘frightening’’ or ‘‘disturbing’’ appear to 

have widespread impact (Id.; Ref. 57 at 

pp. 34–35). The set of proposed required 

warnings includes health warning 

statements and accompanying images 

that convey the risk of secondhand 

smoke on children and babies and the 

risk of smoking while pregnant. 

Similarly, evidence also shows that 

warnings about specific health risks, 

such as cancer, heart disease, and 

stroke, are more effective than general 

warnings, and that the effectiveness of 

graphic warnings relating to specific 

health concerns tends to vary for 

different smoker groups, reflecting their 

perceived relevance (Ref. 52 at pp. 24– 

25; Ref. 57 at p. 34). The statements and 

images published with this proposed 

rule portray specific health risks using 

a variety of themes and techniques in 

order to reach different smoker groups. 

According to the existing research, 

graphic warnings that focus on the 

benefits of quitting may also be effective 

(Ref. 57 at p. 35). The set of published 

images includes warnings addressing 

the benefits of quitting. 

In addition to the types of messages 

and images, the salience or noticeability 

of health warnings is enhanced by the 

use of larger type size, contrasting 

colors, and different typography (Id. at 

p. 28). Research assessing responses to 

warnings on tobacco product packaging, 

as well as responses to safety warnings 

generally, indicate that the effectiveness 

of warnings is enhanced through 

techniques such as larger font sizes, 

upper case lettering, and bold type (Id. 

at p. 33). A number of the proposed 

required warnings utilize these 

techniques. 

Although FDA expects that any final 

rule will include a total of nine different 

required warnings, it has developed a 

larger set of images for the proposed 

rule. FDA is seeking comments on what 

required warnings to include in the final 

rule, including comments on the color 

graphics that are included in this 

proposal. 


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In addition to seeking comment on 

what color graphics to require in the 

final rule, FDA is conducting research 

on the proposed required warnings. The 

larger set of required warnings 

developed for this proposed rule will 

allow for more productive research into 

the relative efficacy of the different 

proposed color graphics. The research 

will: (1) Measure consumer attitudes, 

beliefs, and intended behaviors related 

to cigarette smoking in response to the 

proposed color graphics and their 

accompanying textual warning 

statements; (2) determine whether 

consumer responses to the proposed 

color graphics and their accompanying 

textual warning statements differ across 

various groups based on smoking status, 

age, or other demographic variables; and 

(3) evaluate the relative effectiveness of 

the proposed color graphics and their 

accompanying textual warning 

statements at conveying information 

about various health risks of smoking, 

and additionally, at encouraging 

smoking cessation and discouraging 

smoking initiation (See 75 FR 7604 

(February 22, 2010); 75 FR 52352 

(August 25, 2010)). FDA is in the 

process of conducting this research. 

Once the research is complete and final 

analyses of the results are available, 

FDA will place a report of the results of 

the analyses in the docket and announce 

the report’s availability by a notice in 

the Federal Register so the public has 

an opportunity to comment on the 

results. 

After considering the public 

comments, research results, and 

scientific literature, FDA plans to select 

a set of nine required warnings for the 

final rule, each of which is comprised 

of one color graphic that is paired with 

one of the nine textual warning 

statements. Thus, FDA intends to select 

nine images from among the larger set 

of images in this proposed rule for 

actual use. The agency believes that 

nine required warnings will be 

sufficient to achieve its goal of 

effectively communicating the health 

risks of smoking and to prevent wearout of the proposed required warnings 

for several years. 

In addition, another set of color 

graphics is proposed for use solely in 

advertisements with a small surface area 

(i.e., less than 12 square inches). The 

color graphics in this set differ in their 

composition from the other color 

graphics in that the details of the images 

should be clear, conspicuous, and 

legible even when the graphics are 

reduced in size to be placed on surfaces 

with a relatively small area. FDA 

proposes that the final version of 

‘‘Cigarette Required Warnings—English 

and Spanish’’ also contain graphics from 

this set, which would only be used in 

advertisements with a small surface 

area. But even an advertisement with a 

relatively small surface area would need 

to be large enough so that the required 

graphic and accompanying textual 

warning statement are clear, 

conspicuous, and legible. 

IV. Description of Proposed Regulations 

The Tobacco Control Act mandates 

that FDA issue regulations requiring 

color graphics depicting the negative 

health consequences of smoking to 

accompany the nine health warning 

statements that must appear on cigarette 

packages and in cigarette 

advertisements under FCLAA (15 U.S.C. 

1333). FDA proposes to implement this 

requirement for cigarette packages and 

advertisements by adding a new part 

1141 to title 21 of the Code of Federal 

Regulations governing cigarette package 

and advertising warnings. 

The graphic warnings rule, when 

finalized, is intended to help educate 

consumers about the health risks of 

cigarettes, to support intentions among 

current smokers to quit or decrease 

cigarette consumption, and to 

discourage nonsmokers, particularly 

youth, from initiating cigarette use. We 

seek comment on the proposed part 

1141 described below. If you have 

comments on specific provisions of the 

proposed regulation, we request that 

you identify these provisions in your 

comments. In addition, if you have 

concerns that would be addressed by 

alternative text, we request that you 

provide this alternative text in your 

comments. 

A. Section 1141.1—Scope 

Proposed § 1141.1 would set forth the 

scope of the proposed regulations. 

Proposed § 1141.1(a) explains that part 

1141 would set forth the requirements 

for the display of the health warnings on 

cigarette packages and advertisements 

required by section 4 of FCLAA (15 

U.S.C. 1333), as amended by the 

Tobacco Control Act. This paragraph 

would also indicate that FDA has the 

authority to require additional 

statements on cigarette packages and 

advertisements in accordance with the 

FD&C Act or other authorities (such as 

FCLAA). For example, section 4 of 

FCLAA, as amended by section 206 of 

the Tobacco Control Act, requires the 

agency to initiate a rulemaking to 

determine whether cigarette and other 

tobacco product manufacturers should 

be required to disclose the tar and 

nicotine yields in advertisements and/or 

on packages. In addition, section 906(d) 

of the FD&C Act authorizes FDA to issue 

regulations restricting the sale or 

distribution of cigarettes and other 

tobacco products, including restrictions 

on the advertising and promotion of 

such products, if FDA determines the 

restriction is appropriate for protecting 

public health. 

Proposed § 1141.1(b) would limit the 

applicability of the proposed 

requirements by clarifying that these 

requirements would not apply to 

manufacturers or distributors of 

cigarettes that do not manufacture, 

package, or import cigarettes for sale or 

distribution in the United States. 

In accordance with section 4(a)(4) of 

FCLAA (15 U.S.C. 1333(a)(4)), proposed 

§ 1141.1(c) would provide that a 

cigarette retailer would not be in 

violation of the proposed rule if 

cigarette packages displayed or sold by 

the retailer do not comply with all the 

requirements set forth in the proposed 

rule, so long as the packages contain a 

health warning, are supplied by a 

license- or permit-holding tobacco 

product manufacturer, importer, or 

distributor, and are not altered by the 

retailer in a way that materially impacts 

the display of the required warnings on 

the packages. Thus, manufacturers, 

importers, and distributors would have 

primary responsibility for ensuring that 

the required warnings on cigarette 

packages comply with all the provisions 

of proposed part 1141, but retailers 

would have some responsibility as well. 

Specifically, retailers would be 

responsible for ensuring that all 

cigarette packages they display or sell 

contain a warning regarding the health 

risks associated with smoking cigarettes. 

In addition, retailers could not alter the 

warning in a way that is material to the 

requirements of FCLAA and this 

proposed rule, including by obscuring 

the warning (e.g., by placing a sticker or 

other item on top of it), by shrinking or 

severing the warning (in whole or in 

part), or by otherwise changing it in a 

material way. However, retailers would 

not be responsible for verifying that the 

warnings on packages they display or 

sell contain the combination of textual 

statements and accompanying color 

graphics required by FCLAA, or that 

they comply with other specifications 

required in FCLAA or proposed part 

1141. 

Similarly, proposed § 1141.1(d) 

implements section 4(c)(4) of FCLAA 

(15 U.S.C. 1333(c)(4)) and would 

provide that a retailer would not be 

considered in violation of part 1141 if 

it posts an advertisement that does not 

comply with all of the proposed 

requirements, so long as the 

advertisement was not created by or on 

behalf of the cigarette retailer and the 


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69536 Federal Register / Vol. 75, No. 218 / Friday, November 12, 2010 / Proposed Rules 

retailer is not otherwise responsible for 

inclusion of the required warnings. Note 

that, in accordance with section 4(b) of 

FCLAA (15 U.S.C. 1333(b)), any 

manufacturer, distributor, importer, or 

retailer who is responsible for the 

creation of a cigarette advertisement is 

responsible for compliance with FCLAA 

and proposed part 1141. This paragraph 

also specifies that this provision would 

not relieve a retailer of liability if it 

publicly displays an advertisement that 

fails to contain a health warning or if it 

alters an advertisement in a way that 

materially impacts the display of the 

required warning. Therefore, except for 

when it is responsible for the creation 

of an advertisement or otherwise 

responsible for the inclusion of the 

warning, a retailer is not responsible for 

ensuring that its cigarette 

advertisements contain the combination 

of textual statements and accompanying 

color graphics required by FCLAA, or 

that they comply with other 

specifications required in FCLAA or 

proposed part 1141. However, retailers 

must ensure that their cigarette 

advertisements contain a warning of 

smoking’s risks. They are also 

responsible for complying with the 

other requirements applicable to 

retailers, including those in part 1140 of 

Title 21 of the Code of Federal 

Regulations. 

B. Section 1141.3—Definitions 

Proposed § 1141.3 would establish 

definitions of terms used in the 

proposed rule. 

Proposed § 1141.3 would define the 

terms ‘‘cigarette,’’ ‘‘commerce,’’ 

‘‘package,’’ ‘‘person,’’ and ‘‘United 

States,’’ respectively, for the purposes of 

part 1141, as those terms are defined in 

section 3 of FCLAA (15 U.S.C. 1332). 

Proposed § 1141.3 would define 

‘‘distributor,’’ for the purposes of part 

1141, as any person who furthers the 

distribution of cigarettes at any point 

from the original place of manufacture 

to the person who sells or distributes 

the product to individuals for personal 

consumption. In addition, this 

paragraph would specify that common 

carriers are not considered distributors 

for the purposes of part 1141. 

Proposed § 1141.3 would define the 

terms ‘‘front panel’’ and ‘‘rear panel’’ as 

the two largest display surfaces of the 

cigarette package. FDA is proposing this 

definition to ensure that all entities 

properly identify the sides or surfaces of 

the cigarette package on which the 

required warnings must appear. On 

almost all cigarette packages, these two 

panels are oriented directly opposite 

from one another and are the same size. 

Proposed § 1141.3 would define 

‘‘importer,’’ for purposes of this part, as 

any person who introduces into 

commerce any cigarette that (1) was not 

manufactured in the United States and 

(2) is intended for sale or distribution to 

consumers in the United States. 

Proposed § 1141.3 would define 

‘‘manufacturer’’ as any person, including 

any repacker or relabeler, who 

manufactures, fabricates, assembles, 

processes, or labels a finished cigarette 

product. 

Proposed § 1141.3 would provide a 

definition of ‘‘required warning.’’ This 

term is used to refer to the combination 

of one of the textual warning statements 

and the accompanying color graphic 

depicting the negative health 

consequences of smoking required 

under section 4 of FCLAA and this part. 

Proposed § 1141.3 would define 

‘‘retailer’’ as any person who sells 

cigarettes to individuals for personal 

consumption, or who operates a facility 

where vending machines or self-service 

displays of cigarettes are permitted. 

C. Section 1141.10—Required Warnings 

The Tobacco Control Act directs FDA 

to require that color graphics depicting 

the negative health consequences of 

smoking accompany each of the textual 

warning statements that must be 

randomly displayed (i.e., in each 12- 

month period, all of the different 

warnings must appear in as equal a 

number of times as is possible on each 

brand of the product and be randomly 

distributed in all areas of the United 

States in which the product is marketed) 

on cigarette packages and rotated 

quarterly in alternating sequence in 

cigarette advertisements under FCLAA. 

FDA is proposing that cigarette packages 

and advertisements contain such a 

combination graphic-textual warning in 

proposed § 1141.10. 

Proposed paragraph (a) would set 

forth the requirements specific to 

cigarette packages. Proposed 

§ 1141.10(a)(1) would require that each 

cigarette package sold, offered for sale, 

distributed, or imported for sale or 

distribution within the United States 

contain a required warning. This 

required warning would have to appear 

on both the front and rear panels of the 

cigarette package. As defined in 

proposed § 1141.3, this required 

warning would consist of one of the 

nine textual warning statements set 

forth in FCLAA (15 U.S.C. 1333) and the 

accompanying color graphic depicting 

the negative health consequences of 

smoking. 

Proposed § 1141.10(a)(2) would 

provide that the warnings required 

under paragraph (a)(1) must be obtained 

from the document titled ‘‘Cigarette 

Required Warnings—English and 

Spanish.’’ Due to the multi-color nature 

of the required warnings, they cannot be 

printed in the Code of Federal 

Regulations, and due to the visual 

complexity of the images, it will not be 

feasible to accurately describe the 

images and their colors in the Code of 

Federal Regulations. Thus, FDA 

proposes to provide the required 

warnings for regulated entities in 

‘‘Cigarette Required Warnings—English 

and Spanish,’’ which will contain 

downloadable electronic files used to 

generate each required warning. This 

approach would also help regulated 

entities ensure that their packages 

contain required warnings that are 

consistent with the requirements of 

FCLAA and proposed part 1141, when 

finalized. 

Proposed § 1141.10(a)(2) would also 

mandate that the required warnings be 

accurately reproduced from the 

electronic images in ‘‘Cigarette Required 

Warnings—English and Spanish.’’ Thus, 

regulated entities would have to ensure 

that the required warnings they place on 

packages are not distorted or otherwise 

inaccurately reproduced from the 

electronic images in ‘‘Cigarette Required 

Warnings—English and Spanish.’’ For 

example, the colors used to display the 

required images would have to be 

reproduced accurately from the colors 

used in ‘‘Cigarette Required Warnings— 

English and Spanish.’’ The use of the 

electronic files from ‘‘Cigarette Required 

Warnings—English and Spanish’’ to 

generate the required warnings should 

enable companies to reproduce the 

warnings with relative ease. FDA 

recognizes that there may be minor 

variations in the exact colors used to 

reprint the required warnings across all 

cigarette packages due to differences in 

inks and printing processes, but FDA 

expects that the colors in the graphics 

that appear on packages and in 

advertisements will look the same as the 

colors in the graphics set forth in 

‘‘Cigarette Required Warnings—English 

and Spanish.’’ 

Finally, proposed § 1141.10(a)(2) 

would also specify that the electronic 

images obtained from ‘‘Cigarette 

Required Warnings—English and 

Spanish’’ must be adapted as necessary 

to meet the requirements of section 4 of 

FCLAA (15 U.S.C. 1333) and this part, 

and the electronic files provided in 

‘‘Cigarette Required Warnings—English 

and Spanish’’ would be in a format that 

could be modified as necessary to 

comply with this proposed rule. 

Specifically, regulated entities would be 

able to modify the size of the required 

warnings to ensure they are the required 


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size and occupy the required area of the 

cigarette package. However, any 

modifications to such files would need 

to result in an accurate reproduction of 

the electronic images contained in 

‘‘Cigarette Required Warnings—English 

and Spanish,’’ as proposed by 

§ 1141.10(a)(2). For example, the widthto-height ratio (i.e., the aspect ratio) of 

the images should be preserved when 

the images are compressed or expanded, 

so that the resulting image is not 

distorted. 

Proposed § 1141.10(a)(3) would 

mandate that the required warnings 

appear directly on the package and be 

clearly visible underneath the 

cellophane or other clear wrapping. In 

order for the required warnings to 

appear conspicuously and legibly as 

mandated by section 4 of FCLAA (15 

U.S.C. 1333), they must not be obscured. 

Thus, any outer wrappings on the 

package must be clear so that the 

warnings can be seen and read by 

consumers. Similarly, any other 

material that is placed on the outside of 

packages, such as price information or 

promotional material (e.g., coupons), 

must not be placed over or otherwise 

obscure the required warning. 

As required under section 4 of FCLAA 

(15 U.S.C. 1333), proposed 

§ 1141.10(a)(4) would mandate that the 

required warnings occupy at least 50 

percent of the area of the front panel 

and rear panel of each cigarette package. 

These area requirements would help 

ensure that the required warnings are 

prominent and conspicuous enough to 

gain consumers’ notice in the first 

instance, and are easily viewed and read 

by consumers once they are noticed. 

This will help ensure that consumers 

comprehend the critical information 

conveyed in the required warnings. As 

to location, proposed § 1141.10(a)(4) 

states that the required warnings must 

occupy at least the top 50 percent of the 

area of the front and rear panels of the 

packages. For cigarette cartons, where 

the front and rear panels have 

significantly longer horizontal than 

vertical axes, the textual warning 

statement and accompanying graphic 

might be distorted if they were placed 

on the top 50 percent of these panels 

because the top runs along the longer 

horizontal axis. Thus, under section 

4(b)(4) and (d) of FCLAA, proposed 

§ 1141.10(a)(4) would specify a format 

for these warnings so that they occupy 

at least the left 50 percent of the front 

and rear panels. With this format, the 

required warnings can be sized for 

placement on cigarette cartons without 

distortion. 

Proposed § 1141.10(a)(5) would 

mandate that the required warnings and 

the other information on the panels be 

oriented in the same direction. Thus, for 

example, if the front panel of a cigarette 

package contains information, such as 

the brand name of the product, in a left 

to right orientation, the required 

warning must not be placed such that it 

appears at a right angle to this text. 

Rather, the required warning and its 

component textual statement should 

also appear in a left to right orientation. 

This requirement would help ensure the 

required warnings on cigarette packages 

are conspicuous and legible to 

consumers, as required by section 4 of 

FCLAA. In addition, FDA is proposing 

this restriction under section 906(d) of 

the FD&C Act (21 U.S.C. 387f(d)). 

Requiring all the text on the panel of a 

cigarette package that contains a 

required warning to be oriented in the 

same direction would help ensure that 

the warnings are noticed and read by 

consumers and, therefore, would be 

appropriate for the protection of the 

public health. 

Proposed paragraph (b) of proposed 

§ 1141.10 would set forth the 

requirements specific to cigarette 

advertisements. Proposed 

§ 1141.10(b)(1) would mandate that 

manufacturers, importers, distributors, 

and retailers include required warnings 

in all their cigarette advertising within 

the United States. Thus, all 

advertisements, regardless of form— 

which could include materials such as 

magazine and newspaper ads, 

pamphlets, leaflets, brochures, coupons, 

catalogues, retail or point-of-sale 

displays (including functional items 

such as clocks or change mats), posters, 

billboards, direct mailers, and Internet 

advertising (e.g., Web pages, banner ads, 

etc.)—would have to contain required 

warnings. 

Consistent with section 4(b) of 

FCLAA (15 U.S.C. 1333(b)), proposed 

§ 1141.10(b)(2) would mandate that the 

textual component of the required 

warning appear in the English language, 

with two exceptions. First, per proposed 

§ 1141.10(b)(2)(i), if an advertisement 

appears in a non-English language 

publication, the textual portion of the 

required warning would need to appear 

in the predominant language of the 

publication. The predominant language 

is the primary language used in the nonsponsored content in the publication. 

For example, in the case of a newspaper 

where the non-sponsored content (e.g., 

news stories, articles of opinion, and 

features) are in a foreign language but 

the sponsored content (e.g., advertising) 

is wholly or partially in English, the 

predominant language would be the 

foreign language used in the nonsponsored content, and the required 

warning would have to appear in that 

foreign language. Because such nonEnglish language publications in the 

United States are targeted towards 

consumers who speak the predominant 

language of the publication, this will 

help ensure that the required warning 

effectively communicates to the target 

audience that will view the 

advertisement. Second, per proposed 

§ 1141.10(b)(2)(ii), if an advertisement is 

in an English language publication but 

is presented in a language other than 

English, the textual portion of the 

required warning would need to be 

presented in the same foreign language 

principally used in the advertisement. 

English language publications in the 

United States are generally targeted 

towards the consumer population as a 

whole or towards consumers with a 

particular interest in the subject matter 

of the publication rather than towards 

consumers who speak a particular 

language; however, foreign language 

advertisements in English-language 

publications are targeted towards 

consumers who speak the foreign 

language used in the advertisement. 

Therefore, requiring foreign language 

advertisements in English-language 

publications to present the required 

warning in the same language that is 

used elsewhere in the advertisement 

will help ensure that the target audience 

of the advertisement is able to read and 

understand both the promotional 

content and the important warning 

information. 

Proposed § 1141.10(b)(3) would 

require that English and Spanish 

language required warnings be obtained 

and accurately reproduced from 

‘‘Cigarette Required Warnings—English 

and Spanish.’’ As discussed above, the 

required warnings cannot be accurately 

reprinted or described in the Code of 

Federal Regulations, and FDA is thus 

proposing to provide the required 

warnings for regulated entities in 

‘‘Cigarette Required Warnings—English 

and Spanish,’’ which will contain 

downloadable copies of the electronic 

files used to generate each required 

warning. In addition to offering the 

English-language versions of the 

required warnings that would be used 

on all packages and in most 

advertisements, the document would 

offer Spanish-language versions of the 

required warnings for use in 

advertisements that either appear in 

Spanish-language publications or that 

are presented primarily in Spanish (see 

15 U.S.C. 1333(b)). These versions are 

offered in recognition of the fact that 

Spanish is the foreign language most 

commonly used for cigarette 


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advertisements in the United States. 

However, color graphics for other 

foreign language warnings would need 

to be obtained from the document titled 

‘‘Cigarette Required Warnings—Other 

Foreign Language Advertisements,’’ as is 

discussed in more detail below. As with 

cigarette packages, the required 

warnings placed in cigarette 

advertisements would have to be 

accurate reproductions of those set forth 

in ‘‘Cigarette Required Warnings— 

English and Spanish.’’ In addition, the 

required warnings would need to be 

adapted as necessary to meet the 

requirements of section 4 of FCLAA (15 

U.S.C. 1333) and part 1141. The 

electronic files provided in ‘‘Cigarette 

Required Warnings—English and 

Spanish’’ would be in a format that 

would allow regulated entities to resize 

the required warnings as necessary to 

comply with the other provisions of this 

part, though any modifications made 

would need to result in an accurate 

reproduction of the electronic images 

contained in the documents. 

Proposed § 1141.10(b)(4) would 

require regulated entities to obtain color 

graphics for foreign language required 

warnings, other than Spanish language 

warnings, from the electronic files 

contained in ‘‘Cigarette Required 

Warnings—Other Foreign Language 

Advertisements,’’ into which they must 

insert a true and accurate translation of 

the textual warning language required 

by FCLAA. ‘‘Cigarette Required 

Warnings—Other Foreign Language 

Advertisements’’ would offer 

downloadable electronic files of the 

color graphics and specify (in English) 

the text that is to accompany each color 

graphic. These files would allow for 

insertion of foreign language 

translations of the required textual 

statements, so that regulated entities can 

generate the appropriate required 

warnings for their foreign language 

advertisements, as well as for their 

advertisements that appear in foreign 

language publications. Advertisers 

would need to ensure that the required 

English textual statements are 

accurately and appropriately translated 

into the appropriate foreign language. If 

a warning statement is not accurately 

translated, the advertisement would be 

in violation of FCLAA. In addition to 

ensuring accurate translation, it would 

be the advertiser’s responsibility to 

ensure that the foreign language text 

complies with the format specifications 

set forth in section 4 of FCLAA (15 

U.S.C. 1333). Thus, for example, the text 

should not be placed in a manner that 

interferes with the accompanying color 

graphic. Proposed § 1141.10(b)(4) would 

also mandate that the required warnings 

be adapted as necessary to meet any 

other requirements of section 4 of 

FCLAA (15 U.S.C. 1333) and proposed 

part 1141. The electronic files provided 

in ‘‘Cigarette Required Warnings—Other 

Foreign Language Advertisements’’ 

would allow regulated entities to resize 

the required warnings as necessary to 

comply with the other provisions of part 

1141, though any modifications would 

need to result in accurate reproductions 

of the electronic images contained in the 

documents. 

As required by section 4 of FCLAA 

(15 U.S.C. 1333), proposed 

§ 1141.10(b)(5) would mandate that the 

required warnings comprise at least 20 

percent of the area of each 

advertisement. This will help ensure 

that the required warnings are 

appropriately clear, conspicuous, and 

legible by consumers, so that the 

important health information in the 

required warnings can be adequately 

seen and comprehended. Proposed 

§ 1141.10(b)(5) would also specify that 

the required warnings are to be placed 

in accordance with the other 

requirements set forth in FCLAA for the 

display of such warnings. For example, 

section 4 of FCLAA (15 U.S.C. 1333) 

contains requirements related to the 

placement of the required warnings, as 

well as requirements related to the 

border that must enclose each warning 

in cigarette advertising. FDA intends to 

separately address some of these other 

FCLAA requirements, as well as the 

provisions in section 4(c) of FCLAA (15 

U.S.C. 1333(c)) related to the 

submission of plans regarding the 

random display of warnings on 

packages and rotation of warnings in 

advertisements. 

Proposed § 1141.10(c) would mandate 

that the required warnings be indelibly 

printed on or permanently affixed to 

packages and advertisements. 

Removable or impermanent warning 

displays on packages and in 

advertisements would not comply with 

the requirements of FCLAA, in that the 

required warnings could become 

separated from the package or 

advertisement and thus would not meet 

the requirement that they be 

conspicuous on the package or 

advertisement. The purpose of the 

amendments made to FCLAA by the 

Tobacco Control Act is to strengthen the 

warnings for greater impact on 

consumers. Removable warnings would 

run counter to this purpose. For 

example, if the required package 

warning was printed or stickered on a 

clear outer wrapper, and this wrapper 

was meant to be removed in order for 

the package (or cigarettes within the 

package) to be accessed, the consumer 

could access the package of cigarettes 

numerous times without viewing the 

warning and receiving the impact of the 

critical health message. 

D. Section 1141.12—Incorporation by 

Reference of Required Warnings 

Section 1141.12 proposes that two 

documents, ‘‘Cigarette Required 

Warnings—English and Spanish’’ and 

‘‘Cigarette Required Warnings—Other 

Foreign Language Advertisements,’’ be 

incorporated by reference in accordance 

with 5 U.S.C. 552(a) and 1 CFR part 51. 

Any final regulation will provide 

information on how to obtain the two 

documents. Draft versions of both 

documents are available in the docket. 

These draft versions of the documents 

contain placeholders for the color 

graphics; once FDA selects the required 

warnings for the final rule, it intends to 

include the electronic files for these 

required warnings in the final versions 

of both documents. The material 

incorporated by reference must meet the 

Office of the Federal Register’s 

requirements for incorporating material 

by reference, and thus the way these 

two documents are displayed may be 

changed for the final rule to meet such 

requirements. 

Section 1141.12(a) proposes the 

incorporation by reference of ‘‘Cigarette 

Required Warnings—English and 

Spanish.’’ This document would contain 

the required warnings that must be 

included on all cigarette packages, and 

in cigarette advertisements in which the 

text of the required warning must be set 

forth in the English language or the 

Spanish language. Regulated entities 

would utilize ‘‘Cigarette Required 

Warnings—English and Spanish’’ to 

obtain the required warnings and 

reproduce them on cigarette packages 

and in advertisements in accordance 

with proposed part 1141. This 

document would offer downloadable 

electronic files for each of the required 

warnings. 

FDA expects that the final version of 

‘‘Cigarette Required Warnings—English 

and Spanish’’ will provide a total of nine 

different images, each of which is 

comprised of one color graphic that is 

paired with one of the nine textual 

warning statements set forth in FCLAA. 

In addition, for each of these nine sets, 

FDA expects that the final version 

would include six formatting options in 

accordance with sections 4(a)(2) and 

4(b)(2) of FCLAA (15 U.S.C. 1333(a)(2) 

and (b)(2)). Specifically, each of the nine 

sets would have one formatting option 

where the textual portion of the 

required warning is presented in black 

text on a white background and one 


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formatting option where the textual 

portion of the required warning is 

presented in white text on a black 

background for use on packages. In 

addition, each of these sets would 

include a version of the two previous 

formatting options enclosed in a 

rectangular border for use in 

advertisements in accordance with 

section 4(b)(2) of FCLAA (15 U.S.C. 

1333(b)(2)). Furthermore, each of the 

nine sets would contain an English 

version of these advertisement 

formatting options and a Spanish 

version of these advertising formatting 

options. FDA is requesting comments on 

the different proposed required 

warnings (i.e., the combinations of the 

textual warning statements and 

accompanying color graphics). For more 

information regarding FDA’s research 

analyses, see section III.D. 

In addition, FDA is proposing a subset 

of color graphics for use in 

advertisements with a small surface area 

(i.e., less than 12 square inches). These 

color graphics differ in their 

composition from the other color 

graphics in this document. FDA is 

proposing this subset of color graphics 

to ensure that the details of the images 

are clear, conspicuous, and legible even 

when the image is reduced in size to 

occupy 20 percent of a surface with an 

area of less than 12 square inches. FDA 

proposes that a final version of 

‘‘Cigarette Required Warnings—English 

and Spanish’’ contain such options, 

which would be used (in combination 

with one of the nine textual statements) 

only in advertisements with a small 

surface area. However, even an 

advertisement with a relatively small 

surface area would need to be large 

enough so that the required graphic and 

accompanying textual warning 

statement are clear, conspicuous, and 

legible. 

Section 1141.12(b) proposes the 

incorporation by reference of ‘‘Cigarette 

Required Warnings—Other Foreign 

Language Advertisements.’’ This 

document would contain the electronic 

files that are to be used to generate the 

required warnings for advertisements in 

which the text of the required warning 

must be set forth in a foreign language 

(other than Spanish) under proposed 

§ 1141.12(b). Regulated entities would 

utilize ‘‘Cigarette Required Warnings— 

Other Foreign Language 

Advertisements’’ to generate the 

required warnings for such 

advertisements. This document will 

offer downloadable files of the color 

graphic for each of the required 

warnings and specify (in English) the 

text that is to accompany each color 

graphic. The downloadable files would 

allow for insertion of foreign language 

translations of the required textual 

statements, so that regulated entities can 

generate the appropriate required 

warnings for their foreign language 

advertisements, as well as for their 

advertisements that appear in foreign 

language publications. 

E. Section 1141.14—Misbranding of 

Cigarettes 

Section 1141.14(a) proposes that a 

cigarette shall be deemed to be 

misbranded unless its labeling and 

advertising bear one of the required 

warnings. Under section 903(a)(1) and 

(a)(7)(A) of the FD&C Act (21 U.S.C. 

387c(a)(1) and (a)(7)(A)), a tobacco 

product, including a cigarette, is 

deemed misbranded if its labeling or 

advertising is false or misleading in any 

particular. Under 201(n) of the FD&C 

Act (21 U.S.C. 321(n)), in determining 

whether something is misleading, it: 

‘‘shall be taken into account * * * not 

only representations made or suggested 

* * * but also the extent to which the 

labeling or advertising fails to reveal 

facts * * * material with respect to 

consequences which may result from 

the use of the article to which the 

labeling or advertising relates * * * 

under such conditions of use as are 

customary or usual.’’ The required 

warnings, which concern risks 

associated with the use of cigarettes, are 

clearly material with respect to 

consequences that may result from the 

use of cigarettes. These required 

warnings convey information about the 

addictive nature of cigarettes (which is 

inextricably linked to all the health 

harms caused by cigarettes) as well as 

the major, potentially deadly health 

consequences of smoking, including the 

causal relationship between smoking 

and cancer (cigarettes have been shown 

to cause more than 10 different cancers), 

fatal lung disease (e.g., COPD, which is 

a major public health problem in the 

United States), heart disease and stroke 

(the first and third leading causes of 

death in the United States), and negative 

pregnancy outcomes. In addition, the 

warnings provide information on the 

negative, potentially fatal health effects 

cigarettes can have for non-users, 

including the harm tobacco smoke can 

cause to children and non-smoking 

adults (e.g., fatal lung disease). The 

warnings also provide critical 

information on the significant health 

benefits of quitting. Overall, the 

required warnings provide highly 

material information that every 

consumer should know about the 

consequences of cigarettes under 

customary conditions of use. 

In order to ensure that the required 

warnings are conspicuous, prominent, 

and legible, each individual cigarette 

package or advertisement is required to 

contain only one of the nine required 

warnings under this proposed rule, 

although all nine statements are 

material for cigarettes in general. It 

generally would not be feasible to fit all 

nine statements and their accompanying 

color graphics and have them be 

conspicuous, prominent, and legible. 

Moreover, while any individual package 

or advertisement will not convey the 

information from all nine required 

warnings, all nine warnings will be on 

public display at any given time as the 

Tobacco Control Act requires the 

warnings to be randomly displayed in as 

equal a number of times as possible on 

cigarette packages for all cigarette 

brands and in quarterly rotation in 

advertisements under section 4(c) of 

FCLAA (15 U.S.C. 1333(c)). Thus, 

consumers will be exposed to 

conspicuous, prominent, and legible 

displays of all nine warning statements 

(which apply to all cigarettes) in the 

marketplace at any given time, and as a 

result will receive a summary of the 

major risks of smoking. 

It is worth noting that the warning 

disclosure requirements for tobacco 

products are different than the 

disclosure requirements that apply to 

other products that FDA regulates, as (1) 

the warning information for cigarettes is 

different in its applicability than the 

warning information for other products, 

(2) the disclosure requirements for other 

products have a different purpose than 

the cigarette warnings, and (3) the 

mechanisms for exposure to warning 

information are different for tobacco 

products than for other products FDA 

regulates. For example, medical 

products such as drugs and devices 

have risks that are specified for each 

particular product; these risks are set 

forth in the FDA-required product 

labeling for each product. The statutory 

and regulatory requirements for 

prescription and restricted medical 

products require that each product’s 

labeling and advertising disclose all 

material risk information about the 

particular product (See 21 U.S.C. 352(a), 

(c), (f), (n), (q) and (r); 321(n); see also 

21 CFR 201.100(d)(1) and (d)(3); 

201.105(c)(1); 801.109(d); and 21 CFR 

part 202). This information also has a 

different purpose than cigarette warning 

information. For example, disclosure of 

all the material risk information 

associated with a particular prescription 

or restricted medical product helps 

healthcare professionals by giving them 

some of the information they need to 


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know about the medical product that 

will enable them to safely use or 

prescribe it. Similarly, this risk 

information helps consumers know 

whether medical products may be 

appropriate for them as well as what 

they should tell their healthcare 

professionals about before taking or 

using or while taking or using a product. 

It also lets consumers know what risks 

they might experience and what steps 

they need to take for safety reasons (e.g., 

no driving) because of taking or using a 

product. It would not be appropriate to 

provide partial information of this type 

because the full summary of information 

is needed to ensure safe use. 

In contrast, the warnings for cigarette 

products set forth in FCLAA apply to 

every cigarette product. Cigarettes have 

health risks that are associated with 

their use generally. Furthermore, there 

is no safe method of using cigarette 

products, so this warning information 

has a different purpose than medical 

product warning information, in that it 

is intended to influence awareness of 

cigarette-related health risks and, as a 

result, encourage cessation and 

discourage initiation, rather than to help 

ensure that a particular cigarette 

product is safely used. 

The exposure to product information 

is also different for medical products 

versus cigarette products. For cigarette 

products, the warnings will be printed 

prominently and conspicuously on all 

packages. These required warnings will 

thus be seen by smokers, such as each 

time that smokers buy cigarettes or take 

a cigarette out of its package (as 

discussed in Section III.A, pack-a-day 

smokers can be exposed to warnings 

more than 7,000 times per year). All 

nine of the required warnings also will 

be seen by potential smokers each time 

they are at a point-of-sale considering 

purchasing a package of cigarettes. The 

same is not true of prescription or 

restricted medical products, as the risk 

information is specific to each product, 

is not commonly displayed prominently 

and conspicuously for all products at 

the point of purchase, and is not likely 

to be seen by consumers each time they 

take or use a product. 

In addition, section 1141.14(b) 

proposes that a cigarette advertisement 

or package will be deemed to include a 

brief statement of relevant warnings for 

the purposes of section 903(a)(8) of the 

FD&C Act (21 U.S.C. 387c(a)(8)) if it 

bears one of the required warnings. 

Under section 903(a)(8)(B) of the FD&C 

Act (21 U.S.C. 387c(a)(8)(B)), a tobacco 

product is deemed misbranded unless 

the manufacturer, packer, or distributor 

includes in all advertisements and other 

descriptive printed matter a brief 

statement of, among other things, the 

relevant warnings. The warnings 

required by section 4 of FCLAA for 

cigarette advertising and packages are 

‘‘relevant warnings’’ with respect to 

cigarettes as that phrase is used in 

section 903. For the purpose of this 

provision, ‘‘descriptive printed matter’’ 

includes the product package label, 

which, under this proposed rule, would 

be required to bear certain warnings. 

FDA is thus proposing that packages 

and advertisements that bear one of the 

required warnings in accordance with 

the proposed rule would satisfy the 

requirement to include a brief statement 

of the relevant warnings for the 

purposes of section 903(a)(8). Similarly, 

FDA is proposing that a cigarette 

distributed or offered for sale in any 

State shall be deemed to be misbranded 

under section 903(a)(8) unless the 

manufacturer, packer, or distributor 

includes in all advertisements and 

packages issued or caused to be issued 

by the manufacturer, packer, or 

distributor with respect to the cigarette 

one of the required warnings. 

F. Section 1141.16—Disclosures 

Regarding Cessation 

Section 1141.16 proposes that one or 

more of the required warnings include 

specified information about an 

appropriate smoking cessation resource. 

The goal would be to provide a place 

where smokers and other members of 

the public can obtain smoking cessation 

information from staff trained 

specifically to help smokers quit by 

delivering unbiased and evidence-based 

information, advice, and support. There 

are a number of possible alternatives 

here, including use of an existing or 

new quitline or Web site, where 

smokers and other members of the 

public can obtain current unbiased, 

factual smoking cessation information. 

We are proposing that the final rule 

require that a specified reference to a 

smoking cessation resource be included 

in the required warnings. We propose 

that the resource that is required to be 

referenced must meet specific criteria 

designed to ensure that the cessation 

information, advice, and support 

provided are unbiased and evidencebased. Specifically, we are proposing 

that the referenced resource must meet 

the following criteria: 

• It must provide factual information 

about the harms to health from smoking 

and the health benefits of quitting. 

• It must provide factual information 

about what to expect when trying to quit 

smoking (e.g., common withdrawal 

symptoms and their duration, 

circumstances that can trigger cravings). 

• It must provide practical advice 

(problem-solving/skills training) about 

how to deal with common issues faced 

by users trying to quit (e.g., how to deal 

with cravings and withdrawal). 

• It must provide evidence-based 

advice about how to formulate a plan to 

quit smoking. 

• It must provide evidence-based 

information about effective relapse 

prevention strategies. 

• It must provide factual information 

on smoking cessation treatments, 

including FDA-approved cessation 

medications. 

• The information, advice, and 

support provided must be evidencebased; must be unbiased, including with 

respect to products, services, persons, 

and other entities; and must be relevant 

to tobacco cessation. For example, it can 

include factual information about the 

health risks of smoking but it cannot 

include derogatory statements regarding 

cigarette manufacturers, importers, 

distributors, or retailers or advocate 

public policy changes. 

• Other than as described in the 

criteria for what information may or 

must be provided, the resource must not 

advertise or promote any particular 

product or service. The resource may 

provide one or more FDA-approved 

over-the-counter cessation products, 

provided it does so in a manner that 

does not advertise or promote a 

particular product. 

• It must not selectively present 

information about a subset of FDAapproved cessation products or product 

categories while failing to mention other 

FDA-approved cessation products or 

product categories or reference any drug 

or other medical product that FDA has 

not approved for tobacco cessation. 

• It must not encourage the use of any 

non-evidence based smoking cessation 

practices. 

If the resource chosen is a Web site, 

we propose that it meet the following 

additional criteria: 

• The Web site must not contain a 

link to any Web site unless it meets all 

of the listed criteria. 

• The Web site may refer to one or 

more toll-free telephone numbers, 

provided they meet the applicable 

criteria. 

If the resource chosen is a toll-free 

telephone number, we propose that it 

meet the following additional criteria: 

• The staff that provide smoking 

cessation information and advice are 

trained specifically to help smokers quit 

by delivering unbiased and evidencebased information, advice, and support. 

• The service has appropriate 

controls to ensure the applicable criteria 

are met. 


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The smoking cessation information 

would be included as part of one or 

more of the required warnings and 

therefore would not appear outside of 

the areas specified for the required 

warning (i.e., 50 percent of the area of 

each of the front and rear panels of 

cigarette packages and 20 percent of the 

area of advertisements). Thus, no 

additional space on cigarette packages 

or in advertising would be needed to 

display this information. Some or all of 

the images in the two documents that 

will be incorporated by reference in the 

final rule would contain this smoking 

cessation referral information where this 

information, along with the textual 

warning statement and accompanying 

graphic, are clear, legible, and fit within 

the specified area. FDA requests 

comments regarding the selection of an 

appropriate smoking cessation resource 

and the applicable criteria identified in 

the bullets above. 

Reducing the number of Americans 

who smoke by increasing the likelihood 

that smokers will quit smoking would 

provide substantial public health 

benefits by reducing the life-threatening 

consequences associated with continued 

cigarette use. Moreover, studies have 

found that health warnings are more 

effective if they are combined with 

cessation-related information (Ref. 5 at 

p. C–7). Thus, FDA is proposing to 

require information about an 

appropriate smoking cessation resource 

under section 906(d) of the FD&C Act as 

appropriate for the protection of the 

public health. 

G. Proposed Effective Date 

Section 201(b) of the Tobacco Control 

Act specifies that the requirements for 

health warnings on cigarette packages 

and advertisements for cigarettes are 

effective fifteen months after the 

issuance of the regulations that FDA is 

proposing in this proposed rule, and 

that a final rule must be issued not later 

than 24 months after the date of 

enactment of the Tobacco Control Act. 

Therefore, FDA proposes that any final 

rule will become effective fifteen 

months after the date the final rule 

publishes in the Federal Register. 

During this time, parties should take 

whatever steps they need to plan and 

implement business operations that will 

comply with the final rule. As of the 

effective date, no tobacco product 

manufacturer, importer, distributor, or 

retailer of cigarettes may advertise or 

cause to be advertised within the United 

States any cigarette product unless the 

advertising complies with the final 

regulation. Also, cigarette packages that 

do not comply with the requirements of 

the final rule must not be manufactured 

for sale or distribution in the United 

States as of the effective date. 

As specified in section 201(b) of the 

Tobacco Control Act, however, if a 

packaged cigarette product was 

manufactured prior to the effective date 

of the final rule but does not contain the 

warning statements and graphics 

required under the final rule, the 

product may be introduced into 

commerce in the United States within 

thirty days from such effective date. 

Therefore, manufacturers, distributors, 

importers, and retailers may continue to 

introduce into domestic commerce 

existing inventory that may not contain 

the warning statements and graphics 

required under the final rule for an 

additional thirty days after the effective 

date of any final rule. After the 30-day 

period, manufacturers must not 

introduce into domestic commerce any 

cigarette packages that do not contain 

the warning statements and graphics 

required under the final rule, 

irrespective of the date of manufacture. 

While this limitation only applies to 

manufacturers, we note that keeping 

products without the new, updated 

warnings on the market for an extended 

period of time is not in the interest of 

public health. We request comments 

regarding mechanisms for enforcing this 

rule and its effective date, such as ways 

to differentiate cigarette packages sold 

from existing inventory from those that 

were manufactured after the effective 

date. 

V. Paperwork Reduction Act of 1995 

The required warning disclosures are 

the ‘‘public disclosure of information 

originally supplied by the Federal 

government to the recipient for th[at] 

purpose,’’ and are, therefore, not within 

the scope of the Paperwork Reduction 

Act. See 5 CFR 1320.3(c)(2). 

VI. Executive Order 13132: Federalism 

FDA has analyzed this proposed rule 

in accordance with the principles set 

forth in Executive Order 13132. FDA 

has determined that the proposed rule, 

if finalized, would not contain policies 

that would have substantial direct 

effects on the States, on the relationship 

between the National Government and 

the States, or on the distribution of 

power and responsibilities among the 

various levels of government. 

Accordingly, the agency tentatively 

concludes that the proposed rule does 

not contain policies that have 

federalism implications as defined in 

the Executive order and, consequently, 

a federalism summary impact statement 

is not required. 

VII. Environmental Impact 

FDA has determined under 21 CFR 

25.30(k) that this action is of a type that 

does not individually or cumulatively 

have a significant effect on the human 

environment. Therefore, neither an 

environmental assessment nor an 

environmental impact statement is 

required. 

VIII. Analysis of Impacts 

A. Introduction and Summary 

FDA has examined the impacts of the 

proposed rule under Executive Order 

12866, the Regulatory Flexibility Act 

(5 U.S.C. 601–612), and the Unfunded 

Mandates Reform Act of 1995 (Pub. L. 

104–4). Executive Order 12866 directs 

agencies to assess all costs and benefits 

of available regulatory alternatives and, 

when regulation is necessary, to select 

regulatory approaches that maximize 

net benefits (including potential 

economic, environmental, public health 

and safety, and other advantages; 

distributive impacts; and equity). This 

proposed rule would be an 

economically significant regulatory 

action under the Executive order. 

The Regulatory Flexibility Act 

requires agencies to analyze regulatory 

options that would minimize any 

significant impact of a rule on small 

entities. This proposed rule would have 

a significant economic impact on a 

substantial number of small entities. 

Section 202(a) of the Unfunded 

Mandates Reform Act of 1995 requires 

that agencies prepare a written 

statement, which includes an 

assessment of anticipated costs and 

benefits, before proposing ‘‘any rule that 

includes any Federal mandate that may 

result in the expenditure by State, local, 

and tribal governments, in the aggregate, 

or by the private sector, of $100,000,000 

or more (adjusted annually for inflation) 

in any one year.’’ The current threshold 

after adjustment for inflation is $135 

million, using the most current (2009) 

Implicit Price Deflator for the Gross 

Domestic Product. This proposed rule 

would result in a 1-year expenditure 

that would meet or exceed this amount. 

FDA’s estimate of the benefits of the 

proposed rule is determined by the 

predicted reduction in the number of 

U.S. smokers and the consequent 

reduction in the number of people who 

will ultimately become ill or die from 

causes related to smoking. FDA 

estimates that this proposed rule will 

reduce the number of smokers by 

537,000 in 2013, with small additional 

reductions over the following 20 years. 

We estimate the present value of the 

rule-induced benefits at a 3 percent 

discount rate to be $10.1 to $28.4 


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billion, including $8.96 to $26.89 billion 

in gained life-years, $202.1 to $606.2 

million in reduced non-fatal 

emphysema, $393.1 million in reduced 

fire losses, and $498.9 million in 

medical cost reductions. At a 7 percent 

discount rate, our estimates of total 

benefits become $2.29 to $6.03 billion, 

including $1.80 to $5.41 billion due to 

the increase in life-years, $64.9 to 

$194.7 million in reduced emphysema, 

$180.6 million in reduced fire losses 

and $244.0 million in medical cost 

reductions. The annualized benefits 

range from $676.0 million to $1.91 

billion with a 3 percent discount rate 

and from $216.6 to $569.6 million with 

a 7 percent discount rate. Most of the 

public health benefits from the 

proposed rule would be realized in the 

future; perhaps several decades after the 

rule took effect. In other words, the 

benefits estimated here for the typical 

dissuaded smoker consist of health 

gains to be realized decades in the 

future. 

The estimated totals may understate 

the full public health benefits of the 

proposed rule because they fail to 

quantify reductions in smokers’ nonfatal illnesses other than emphysema, 

the reduction in external effects 

attributable to passive smoking, and the 

reduction in infant and child fatalities 

caused by mothers’ smoking during 

pregnancy. 

TABLE E1—BENEFITS OF REGULATION

Impacts of the rule 

Annualized benefits ($ mil) 

3 percent 7 percent 

Low Medium High Low Medium High 

Smokers’ Life-Years Saved ............................................. 602.5 1,205.0 1,807.5 170.4 340.7 511.1 

Emphysema Reductions .................................................. 13.6 27.2 40.7 6.1 12.2 18.4 

Fire Loss Averted ............................................................. 26.4 26.4 26.4 17.1 17.1 17.1 

Medical Expenditure Reduction ....................................... 33.5 33.5 33.5 23.0 23.0 23.0 

Total .......................................................................... 676.0 1,292.1 1,908.2 216.6 393.1 569.6 

Note: Table entries are annualized over twenty years, but many of the benefits represented will not be realized until well beyond the twentieth 

year of the proposed rule’s implementation. 

The total estimated costs of the final 

rule include $219.2 million to $529.5 

million in one-time costs and $6.2 

million in annual costs. Annualized 

over 20 years, the total costs range from 

$20.3 million to $40.6 million with a 3 

percent discount rate and from $25.1 

million to $52.5 million with a 7 

percent discount rate, as shown in Table 

E2. These costs will arise primarily due 

to the need to change cigarette package 

labels and remove point-of-sale 

promotions that do not comply with the 

new restrictions. FDA could not 

quantify every regulatory cost. Some 

commercial sectors will experience 

costs for short-term dislocations of 

current business activities, but the costs 

would be mitigated for those businesses 

that anticipate the industry’s 

adjustments. 

In addition to the costs described 

above, the rule will lead to private costs 

in the form of reduced revenues for 

many firms in the affected sectors. 

These sector-specific revenue 

reductions are for the most part 

distributional effects and cannot be 

counted as social costs. 

TABLE E2—COSTS OF REGULATION

Requirements of the rule 

Annualized costs ($ mil) 

3 percent 7 percent 

Low Medium High Low Medium High 

Private Sector 

Labeling Change ....................................................... 11.0 20.0 29.2 14.9 27.0 39.4 

Market Testing .......................................................... 0.3 0.7 2.4 0.4 1.0 3.3 

Point-of-Sale Advertising .......................................... 3.0 3.0 3.0 4.0 4.0 4.0 

Subtotal .............................................................. 14.3 23.7 34.6 19.3 32.0 46.7 

Government 

FDA ........................................................................... 6.0 6.0 6.0 5.8 5.8 5.8 

Subtotal .............................................................. 6.0 6.0 6.0 5.8 5.8 5.8 

Total ............................................................ 20.3 29.7 40.6 25.1 37.8 52.5 

As tobacco industry revenues decline, 

state and Federal tobacco tax revenues 

will also fall. If excise tax rates on 

tobacco products remain at current 

levels, annual state tax revenues would 

fall by approximately $106.1 million 

and annual Federal tax revenues by 

$80.5 million. 

B. Need for Rule 

According to the nation’s health 

experts, tobacco use remains the most 

important preventable cause of 

morbidity and premature mortality in 

the United States, accounting each year 

for over 400,000 deaths (Ref. 58; Ref. 1). 

Written with the goal of ameliorating 

the enormous toll on the public health 

that is directly attributable to the 

consumption of cigarettes, the Tobacco 


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6The effects of anti-smoking policies occur over 

a long period of time, so we want to include at least 

one full generation in our analysis. Using a twentyyear time horizon allows us to do this while still 

avoiding the extreme uncertainty regarding effects 

occurring in the more distant future. 

7 In their multivariate regression analysis, Sloan 

et al. control for alcohol intake, body mass index, 

financial planning horizon, race, education and 

marital status. 

Control Act mandates the publication of 

this proposed rule. Section 201 of the 

Tobacco Control Act modifies section 4 

of FCLAA (15 U.S.C. 1333) to require 

that nine new health warning 

statements, along with color graphics 

depicting the negative health 

consequences of smoking, appear on 

cigarette packages and in cigarette 

advertisements. In the following 

analysis, we estimate the costs and 

benefits of this statutory requirement. 

C. Benefits 

We estimate the benefits of the 

proposed rule by comparing expected 

life-cycle events of smokers with those 

of nonsmokers. Nonsmokers tend to live 

longer and contract fewer lung and 

other diseases, so the benefits in our 

analysis include the discounted value of 

life-years gained, cases of emphysema 

avoided and medical services freed for 

other uses. We also include an estimate 

of the monetary value of the property 

and lives saved as a result of the ruleinduced reduction in the number of 

accidental fires caused by smoking. 

1. Reduced Smoking Rates 

The changes outlined in this proposed 

rule are projected to decrease smoking 

initiation and increase smoking 

cessation. For each of the first twenty 

years of the proposed rule’s 

implementation (2012–2031),6 FDA 

calculates the predicted decrease in the 

number of U.S. smokers by multiplying 

together the following: 

(a) The estimated effect (a percentage 

point change) of cigarette warning labels 

on the national smoking rate, and 

(b) The population in a particular year 

in the absence of the proposed 

regulation (as projected by the U.S. 

Census Bureau). 

To obtain estimates of the effect of 

cigarette warning labels on smoking 

rates (item (a) in the list above), we look 

to the experience of Canada, which has 

required the use of graphic warning 

labels since December, 2000 (Ref. 59). 

The advantage of this approach lies in 

our ability to observe actual consumer 

behavior—in the form of changes in 

smoking rates—before and after a 

graphic warning label requirement went 

into effect. The warning labels to be 

required in the proposed rule are 

generally similar to those developed by 

Health Canada and other international 

authorities. As in Canada, the labels 

required by the proposed rule would 

occupy at least half the front and rear 

display panels of a cigarette package. 

Moreover, under the proposed rule, 

there would be a mix of warning 

statements and images that depict the 

negative consequences of smoking. 

Although the proposed rule would 

follow much the same approach as the 

Canadian warning label requirements, it 

would differ in some ways: Canada has 

16 labels in rotation, rather than 9; 

warning statements appear in English 

on one side of a package and in French 

on the other; and health and cessation 

information is included on leaflets 

within Canadian cigarette packages (Ref. 

60). These details, combined with 

general differences in legal and social 

trends, indicate that Canada’s 

experience with warning labels can give 

only a general idea of the changes in 

smoking rates to be expected as a result 

of the proposed rule. In addition, other 

smoking control initiatives, including 

an increase in the cigarette tax and new 

restrictions on public smoking also 

occurred in both the United States and 

Canada during the period of our 

analysis. These and other confounding 

factors make our estimate of the effect 

of proposed warning labels highly 

uncertain. 

Health Canada (Ref. 61) reports 

Canadian smoking rates for ages 15 and 

above for each year from 1999 through 

2008. FDA obtained smoking rates for 

adults, aged 18 and above, in the United 

States from the National Health 

Interview Survey (Ref. 62). We used the 

results from these two reports to 

calculate the U.S.-Canada smoking rate 

difference for each year. 

Using data from Health Canada (Ref. 

63), the National Institutes of Health 

(Ref. 64) and the National Health 

Interview Survey (Ref. 62), FDA finds 

that Canadian smoking rates followed a 

roughly linear downward trend from 

1985–2000, while U.S. smoking rates 

declined logarithmically over the same 

time period; the predicted smoking rate 

decrease was 0.67 percentage points per 

year in Canada and, as of the year 2000, 

0.24 percentage points per year in the 

United States. Using the estimated 

trends, we predict smoking rates for the 

United States and Canada, and the 

difference between them, for each year 

up to 2008. We then subtract the 

predicted U.S.-Canada smoking rate 

differences from the actual differences 

observed in the data. Implicit in this 

method is the assumption that these 

otherwise unexplained differences may 

be attributed solely to the presence in 

Canada of graphic warning labels. We 

do not account for potential 

confounding variables; our method is 

therefore a rudimentary approach to 

estimating the smoking reduction that 

would be effected by the proposed 

warning labels and may be producing 

results that are off by one or more orders 

of magnitude. FDA requests comments 

on this issue. 

Using this rudimentary approach, 

FDA estimates that the average 

unexplained difference between the 

United States and Canada in national 

smoking rates is 0.212 percentage points 

higher for the 2001–2008 period than for 

1999–2000. Applying this estimate to 

population projections (Ref. 65) and 

summing over all age groups yields an 

estimate that the rule would reduce 

(either through cessation or avoided 

initiation) the United States’ smoking 

population by approximately 537,000 in 

2013, with the total decrease rising to 

approximately 619,000 in 2031 due to 

population growth. 

2. Expected Life-Years Saved 

The largest health consequence of 

smoking is the increased rate of 

mortality from cardiovascular disease, 

cancer, and certain other illnesses. As a 

result, the largest benefits of this 

proposed rule stem from the increased 

life expectancies for those individuals 

who, in the absence of this proposed 

rule, would be smokers and thus 

susceptible to premature mortality from 

one of these often-fatal diseases. We 

calculate the number of life-years saved 

using differences in the probabilities of 

survival for smokers and nonsmokers. 

Sloan et al. (Ref. 66) construct life tables 

for various categories of individuals, 

including ‘‘non-smoking smokers’’ and 

typical 24-year-old smokers. A nonsmoking smoker is someone who does 

not use cigarettes but otherwise exhibits 

the lifestyle and personal 

characteristics 7 of the average smoker. 

A typical 24-year-old smoker does not 

necessarily smoke for his or her entire 

life, but instead faces cessation 

probabilities that are in line with values 

observed for all ages in the National 

Health Interview Survey; the life 

expectancy effects of cessation at older 

ages are netted out of life expectancy 

effects of avoiding smoking at age 24 

(results reported below). Sloan et al.’s 

life tables allow us to calculate how 

many additional deaths, per 100,000 

population, may be expected among 

typical smokers than among nonsmoking smokers between the 24th and 

25th birthdays, the 25th and 26th, and 

so on until the 100th birthday. (To 

simplify the calculation, FDA assumes 


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8Chronic obstructive bronchitis is a smokingrelated illness that is closely related to emphysema 

so that the two conditions are now generally 

categorized together as chronic obstructive 

pulmonary disease (COPD). Because the sources we 

use in this section only report the health and 

welfare effects of emphysema, our resulting benefits 

estimates include only a portion of the total social 

gains associated with rule-induced COPD 

reductions. 

that differences in survival probabilities 

for smokers and nonsmokers are 

negligible below age 24 and above age 

100.) Overall, Sloan et al. find that a 

typical 24-year-old female smoker can 

expect to live another 55.5 years, while 

a comparable nonsmoker can expect 

another 57.8 years of life, producing an 

overall regulation-induced gain of 2.4 

life-years per individual who is 

prevented from starting to smoke. 

Comparing male 24-year-old typical and 

non-smoking smokers, life expectancy 

increases from 49.8 to 54.2 years, 

producing a gain of 4.4 years. The gap 

between male and female life 

expectancy results may be due to 

different physiological responses to 

equal amounts of smoking, different 

lifetime cessation patterns or different 

smoking intensities. Taylor et al. (Ref. 

67), for instance, find that male smokers 

are more likely than female smokers to 

consume more than a pack a day. Sloan 

et al. do not report how much of the 

male-female difference in their 

estimated life expectancy effects may be 

attributed to each possible mechanism. 

While FDA considers Sloan et al.’s 

methodology to be the most suitable in 

the literature for purposes of the present 

analysis, several other studies of 

survival probabilities among smokers 

who quit early in life compared with 

smokers who persist in smoking into 

later decades suggest that the average 

life expectancy gains of not smoking 

may be much higher for both males and 

females. Since these other studies have 

found larger increases in life expectancy 

attributable to smoking avoidance, the 

Sloan et al. results may be considered 

conservative. 

We assume that each person who 

reaches age 24 during the twenty years 

(2012–2031) of our analysis and is 

dissuaded from smoking extends his or 

her life by the gender-specific amount 

Sloan and co-authors report. For older 

individuals, whose post-smoking 

cessation survival probabilities cannot 

be plausibly assumed to equal those of 

individuals who were nonsmokers at 

age 24, we predict life extensions using 

former smoker life tables that we 

construct using Sloan et al.’s results and 

cessation probabilities from the 1998 

National Health Interview Survey (Ref. 

62). 

3. Benefits of Reduced Premature 

Mortality 

OMB Circular A–4 (Ref. 68) advises 

that the best means of valuing benefits 

of reduced fatalities is to measure the 

affected group’s willingness-to-pay to 

avoid fatal risks. Three life-year values 

(also known as values of a statistical 

life-year, or VSLY) used frequently in 

the literature and in previous analyses 

are $100,000, $200,000 and $300,000 

(Ref. 69; Ref. 70; 74 FR 33030, July 9, 

2009), which we update to $105,000, 

$210,000 and $315,000 in 2009 prices. 

These values constitute our estimates of 

willingness-to-pay for a year of life 

preserved in the present. The economic 

assessment of a future life-year requires 

discounting its value to make it 

commensurate with the value of present 

events. For this analysis, we use 3 

percent and 7 percent discount rates to 

calculate the present value of the lifeyears we predict will be saved. 

For each dissuaded smoker, we 

multiply a VSLY by the relevant ageand gender-specific life extension and 

then discount appropriately to arrive at 

a per-person value of reduced mortality. 

For 24-year-olds, this value ranges from 

$9,166 (for a female applying a VSLY of 

$105,000 and a 7 percent discount rate 

to her 2.4 life-years gained due to 

smoking avoidance) to $358,864 (for a 

male applying a VSLY of $315,000 and 

a 3 percent discount rate to his 4.4 lifeyears gained due to smoking avoidance). 

Multiplying the per-person values by 

the predicted number of dissuaded 

smokers yields estimates of ruleinduced mortality benefits that range 

from $3.61 to $53.78 billion. 

This range tends to overstate the net 

benefits of reduced smoking because it 

does not account for lost consumer 

surplus associated with the activity of 

smoking. Cutler (Ref. 69) suggests that 

lost consumer surplus might equal 

around fifty percent of the dollar value 

of life-year gains, which necessitates 

dividing the estimated gross benefits in 

half. This adjustment is based on a very 

simple linear model of cigarette demand 

that is not definitive; a more dataintensive model may produce an 

adjustment factor very different from 

fifty percent. FDA requests comments, 

additional data and research on this 

adjustment. Net benefits estimates, for 

all VSLY ($105,000, $210,000 and 

$315,000) and both discount rates (3 

percent and 7 percent) and produced 

using the Cutler adjustment factor, 

appear in Table E3. 

These totals may understate the full 

value of rule-induced reductions in 

mortality because they fail to quantify 

any reduction in either the external 

effects attributable to passive smoking 

or the infant and child fatalities caused 

by mothers’ smoking during pregnancy. 

Sloan et al. (Ref. 66) indicate that, 

historically, the inclusion of spouse and 

infant deaths increased estimates of 

smoking’s mortality effects by 

approximately 26.3 percent. We do not 

incorporate this adjustment into our 

analysis, however, since recent public 

smoking restrictions and educational 

campaigns have reduced external 

smoking exposure to well below 

historical levels, though not to zero. 

TABLE E3—PRESENT VALUE OF LIFETIME REDUCED SMOKER MORTALITY

Value of a Statistical Life-Year = $105,000 Value of a Statistical Life-Year = $210,000 Value of a Statistical Life-Year = $315,000 

3% Discount rate 7% Discount rate 3% Discount rate 7% Discount rate 3% Discount rate 7% Discount rate 

$8,963,863,457 $1,804,953,192 $17,927,726,915 $3,609,906,384 $26,891,590,372 $5,414,859,576 

4. Reduced Emphysema 

In the previous section, we estimated 

the benefits that will accrue as a result 

of the rule-induced reduction in 

premature deaths from lung cancer, 

cardiovascular disease and other 

smoking-related illnesses. Cigarette 

smoking is also a major risk factor for 

diseases that are less immediately fatal. 

As with premature death, individuals 

are assumed to be willing to give up 

valuable resources in the present in 

order to avoid the pain and distress 

associated with these non-fatal illnesses. 

Emphysema, a form of COPD,8 is 

perhaps the most notable such illness. 

Sloan et al. (Id.) estimate young 

smokers’ lifetime illness profiles and 

report that smoking has a larger effect 

on expected years with emphysema 

than on expected years with cancer, 

coronary heart disease or any of the 


emcdonald on DSK2BSOYB1PROD with PROPOSALS2
Federal Register / Vol. 75, No. 218 / Friday, November 12, 2010 / Proposed Rules 69545 

9 Due to the slow progressive nature of 

emphysema, patients with emphysema experience 

a diminished quality of life for longer periods than 

do patients with other smoking-related illnesses, 

which more rapidly progress to death. 10One of the first states to enact these laws, New 

York, requires cigarettes to self-extinguish 75% of 

the time (Ref. 73). First-year (2004) data in New 

York show a reduction in smoking-caused fires by 

about 33% from the average of the three previous 

years of complete data (Ref. 74). 

other conditions they study.9 In order to 

quantify the value of rule-induced 

reductions in years spent experiencing 

emphysema, we scale our estimates of 

the value of a statistical life-year 

($105,000, $210,000 and $315,000, as 

discussed in section VIII.C.3) by a ratio 

representing the tradeoff individuals are 

willing to make between perfect health 

and the state of having emphysema. 

Sullivan and Ghushchyan (Ref. 71) 

estimate this tradeoff with a regression 

of EQ–5D health index scores on disease 

indicators. EQ–5D survey responses—to 

questions about five areas of health, 

including mobility, pain, and ability to 

perform usual activities—are mapped so 

that a score of one represents bestmeasurable health, a score of zero 

represents death, and fractional values 

represent intermediate levels of health. 

Sullivan and Ghushchyan’s regression 

analysis indicates that a year with 

emphysema decreases, on average, a 

patient’s welfare as much as the loss of 

0.0667 years of perfect health. 

Multiplying this average welfare loss by 

life-year values of $105,000, $210,000 

and $315,000 yields estimates of $7,000, 

$14,000 and $21,000 for the amounts 

individuals are willing to pay to avoid 

a year of emphysema. 

Sloan et al. (Ref. 66) estimate that a 

24-year-old smoker can expect, on 

average, an extra 0.46 discounted years 

(using a discount rate of 3 percent) or 

0.22 discounted years (using a discount 

rate of 7 percent) of emphysema over his 

or her lifetime, as compared with an 

otherwise equivalent nonsmoker. Sloan 

and co-authors do not report the effect 

of smoking on emphysema years for 

members of other age cohorts, so FDA 

takes the conservative approach of 

estimating benefits only for those 

individuals who reach age 24 sometime 

during the first twenty years of the 

proposed rule’s implementation. 

(Smoking cessation brought about by 

this rule will almost certainly reduce 

emphysema for some individuals who 

are over age 24 at the time of the rule’s 

implementation. However, due to data 

constraints, we omit the benefits to 

these older individuals; this is why we 

describe our estimate as conservative.) 

Multiplying our predictions of persmoker decreased discounted diseaseyears by Sullivan and Ghushchyan’s 

welfare loss per year of emphysema and 

FDA’s estimates of the rule-induced 

reduction in the number of smokers (see 

section VIII.C.1 for a discussion of 

methodology), discounting 

appropriately, and dividing in half (per 

Ref. 69) yields a rule-induced welfare 

gain of $64.9 to $606.2 million. Results 

appear in Table E4. Smokers also suffer 

from other non-fatal illnesses but we do 

not include those losses in this analysis. 

Since we do not quantify reductions in 

smokers’ non-fatal illnesses other than 

emphysema, these estimates represent 

lower bounds on the value of ruleinduced morbidity reductions. 

TABLE E4—PRESENT VALUE OF 24-YEAR-OLDS’ LIFETIME REDUCED EMPHYSEMA

Value of a Statistical Life-Year = $105,000 Value of a Statistical Life-Year = $210,000 Value of a Statistical Life-Year = $315,000 

3% Discount rate 7% Discount rate 3% Discount rate 7% Discount rate 3% Discount rate 7% Discount rate 

$202,075,479 $64,886,926 $404,150,958 $129,773,852 $606,226,437 $194,660,778 

5. Reduced Fire Costs 

Each year, fires started by lighted 

tobacco products kill and injure people 

and destroy structures and other 

property. In the United States in 2007, 

civilian deaths caused by smokingrelated fires totaled 720, with direct 

property damage of $530 million (Ref. 

72). A reduction in the number of 

smokers, and the coinciding number of 

cigarettes smoked, will reduce the 

number of future fires. 

The percentage reduction in fires may 

not equal the percentage reduction in 

cigarette consumption, however, 

because since 2003 forty-nine states 

have passed legislation that requires 

cigarettes to be self-extinguishing or 

fire-safe (with the effectiveness dates of 

some of these state laws extending into 

2011). FDA acknowledges some 

uncertainty in the effectiveness rate of 

fire-safe cigarettes; 10 for this analysis, 

we estimate that 50 percent of 

apparently rule-induced future fire 

reductions would have been avoided 

even without the proposed rule due to 

fire-safe cigarette design. 

Using a $7.9 million value of a 

statistical life (Ref. 75, which is the 2006 

value updated to 2009 dollars using Ref. 

76), FDA projects fire-cost savings of 

$393.1 million (at a three percent 

discount rate) or $180.6 million (at a 

seven percent discount rate); of these 

totals, 9.7% consists of averted property 

damage and the rest of lives saved. 

These estimated savings may 

significantly underestimate the potential 

benefits because they exclude the value 

of reduction in fire-caused non-fatal 

injuries. 

6. Medical Services 

Sloan et al. (Ref. 66) estimate that 

smokers use more medical services over 

their life cycles than do comparable 

nonsmokers, with a specific net cost of 

$3,757 per female 24-year-old smoker 

and $2,617 per male 24-year-old smoker 

(in 2000 dollars and with a 3 percent 

discount rate). If these payments are 

distributed equally from ages 24 to 100, 

given FDA’s projected 20-year 

reductions in smoking prevalence, 

smoking-related medical expenditures 

would fall by $1.87 billion, of which 

$997.7 million would be realized as 

savings by smokers themselves and 

$870.6 million by nonsmokers (in the 

form of decreases in private insurance 

premiums or taxes used to fund 

government health programs such as 

Medicare). With a 7 percent discount 

rate, the total decrease in expenditure 

becomes $915.5 million, with $488.0 

million of those savings accruing to 

smokers and $427.5 million to 

nonsmokers. 

In the absence of the rule, some 

portion of smoking-related medical 

expenditures accrues to health service 

providers as economic rent (also known 

as producer surplus). Any reduction of 

this portion would not contribute to the 

social benefit of the rule but would 

instead be a transfer of value from 

producers to consumers and other 

payers. If, however, the supply of 

smoking-related medical services is 

highly elastic, especially in the long 

run, producer surplus would be small. 

For this reason, FDA does not adjust for 

potential rent transfer. We do, however, 

include only the decrease in medical 

expenditure by smokers as a 

contribution to the rule’s benefits. 


emcdonald on DSK2BSOYB1PROD with PROPOSALS2
69546 Federal Register / Vol. 75, No. 218 / Friday, November 12, 2010 / Proposed Rules 

Because nonsmokers’ payments take the 

form of a subsidy for smoking-related 

medical services, some portion of their 

expenditure in the absence of the rule 

is greater than smokers’ own 

willingness-to-pay for medical services. 

Hence, the avoidance of this portion of 

the spending would transfer value from 

smokers to nonsmokers but not 

contribute to an overall social benefit of 

the rule. We do not know the size of this 

portion relative to nonsmokers’ overall 

rule-induced expenditure change, so we 

take the conservative approach of 

excluding nonsmokers’ expenditures 

from our benefits calculation. 

As a final adjustment, we divide the 

remaining expenditure change in half to 

account for smokers’ lost consumer 

surplus associated with the activity of 

smoking. This yields a rule-induced 

benefit of $498.9 million (at a 3 percent 

discount rate) or $244.0 million (at a 7 

percent discount rate). 

7. Summary of Benefits 

The discussion above demonstrates 

the considerable magnitude of the 

economic benefits available from 

smoking reduction efforts. Estimates are 

summarized in Table E5. FDA requests 

comments on the sources and methods 

used to produce these results. 

TABLE E5—PRESENT VALUE OF BENEFITS ($ MIL) 

VSLY = $105,000 VSLY = $210,000 VSLY = $315,000 

3% 

Discount rate 

7% 

Discount rate 

3% 

Discount rate 

7% 

Discount rate 

3% 

Discount rate 

7% 

Discount rate 

Life-Years ................................................. 8,963.9 1,805.0 17,927.7 3,609.9 26,891.6 5,414.9 

Non-Fatal Emphysema ............................ 202.1 64.9 404.2 129.8 606.2 194.7 

Fire Loss .................................................. 393.1 180.6 393.1 180.6 393.1 180.6 

Medical Expenditure Reduction ............... 498.9 244.0 498.9 244.0 498.9 244.0 

Total .................................................. 10,057.9 2,294.5 19,223.8 4,164.3 28,389.8 6,034.1 

8. Uncertainty Analysis 

Estimation of the effectiveness of the 

proposed rule (on reducing the future 

U.S. smoking rate) is subject to a large 

uncertainty that is not fully reflected in 

the benefits estimates appearing in the 

preceding sections, which only reflect 

different estimates of the value of a 

statistical life year. In this section, we 

show the uncertainty associated with 

our estimate of the effectiveness of the 

proposed rule. 

Our primary estimate, that the U.S. 

smoking rate will decrease by 0.212 

percentage points, was calculated in the 

following steps. First, we found the 

decrease in Canadian smoking rates 

since 1999 over and above what would 

have been expected using the pre-2001 

trend. We then subtracted the analogous 

unexplained decrease in the U.S. 

smoking rate over the same period. This 

middle step was driven by the idea that 

the U.S. experience could proxy for 

recent social or policy changes (such as 

public smoking restrictions) that may 

have had effects on Canada’s smoking 

rate and thus needed to be subtracted in 

order to isolate the effect of graphic 

warning labels. The last step was to 

calculate the difference between U.S. 

and Canadian unexplained decreases in 

smoking before and after graphic 

warning labels were introduced in 

Canada. We attributed the remaining 

unexplained difference to graphic 

warning labels. 

However, the U.S. social and policy 

climate may have been so different from 

Canada’s during the years 1999–2008 

that this proxy is inappropriate. To 

account for this possibility, we calculate 

the unexplained difference in Canadian 

smoking rates before and after graphic 

warning labels were introduced, this 

time omitting any U.S. adjustments. 

(Anti-smoking policies and programs 

other than the graphic warning labels 

are assumed to be incorporated in the 

pre-2001 trend, with no additional 

effects of these variables occurring postintroduction of graphic warning labels.) 

This approach indicates that graphic 

warning labels may have been 

responsible for a 1.648 percentage point 

decrease in the Canadian smoking rate. 

If the proposed rule were to achieve this 

effectiveness level in the United States, 

benefits would be approximately eight 

times larger than those reported earlier 

in this analysis. 

On the other hand, because FDA has 

had access to very small data sets, our 

effectiveness estimates are in general 

not statistically distinguishable from 

zero; we therefore cannot reject the 

possibility that the proposed rule would 

not change the U.S. smoking rate. In this 

case, the proposed rule would not 

generate any quantifiable benefits, so 

the appropriate lower bound on benefits 

is zero. Ranges of benefits, representing 

the zero-effect case and the Canada-only 

modeling approach, appear in Table E6. 

The wide ranges shown in the table 

highlight the uncertainty inherent in our 

approach. 

TABLE E6—PRESENT VALUE OF BENEFITS, RANGES ($ BILLION) 

VSLY = $105,000 VSLY = $210,000 VSLY = $315,000 

3% 

Discount rate 

7% 

Discount rate 

3% 

Discount rate 

7% 

Discount rate 

3% 

Discount rate 

7% 

Discount rate 

Life-Years ................................................. [0, 69.7] [0, 14.0] [0, 139.3] [0, 28.1] [0, 209.0] [0, 42.1] 

Non-Fatal Emphysema ............................ [0, 1.6] [0, 0.5] [0, 3.1] [0, 1.0] [0, 4.7] [0, 1.5] 

Fire Loss .................................................. [0, 3.1] [0, 1.4] [0, 3.1] [0, 1.4] [0, 3.1] [0, 1.4] 

Medical Expenditure Reduction ............... [0, 3.9] [0, 1.9] [0, 3.9] [0, 1.9] [0, 3.9] [0, 1.9] 

Total .................................................. [0, 78.2] [0, 17.8] [0, 149.4] [0, 32.4] [0, 220.1] [0, 46.9] 


emcdonald on DSK2BSOYB1PROD with PROPOSALS2
Federal Register / Vol. 75, No. 218 / Friday, November 12, 2010 / Proposed Rules 69547 

11All of the up-front costs of this rule are 

assumed to occur at the beginning of the first period 

of the time horizon of this rule (2011). The cost 

tables present raw undiscounted calculations of 

these up-front costs. For summary tables requiring 

a present value, these costs are discounted 1 year 

to the present (2010). 

D. Costs 

The proposed rule would create new 

burdens for cigarette manufacturers. In 

particular, manufacturers would incur 

the large up-front costs associated with 

a major labeling change.11 Cigarette 

manufacturers and retailers would be 

responsible for the removal of 

noncompliant point-of-sale advertising. 

Consumers are likely to ultimately bear 

a share of these costs in the form of 

increased prices. In addition, the 

tobacco industry and possibly other 

sectors will experience lost sales and 

employment, but these revenue transfers 

will be offset by gains to other sectors, 

as discussed in the ‘‘Distributional 

Effects’’ section of this document. 

1. Number of Affected Entities 

Labeling and advertising requirements 

would affect domestic cigarette 

manufacturers and importers of foreignmade cigarettes. Statistics of U.S. 

Businesses’ data show that there were 

24 cigarette manufacturing firms in the 

United States in 2007 (Ref. 77). An 

undetermined number of importers 

would also be affected. 

Noncompliant point-of-sale 

advertising would be removed by 

manufacturers (or importers) and 

retailers. We use detailed data from the 

2002 Economic Census report on 

product line sales for establishments 

with payroll to estimate the percentage 

of various types of retail establishments 

that sell tobacco products. Searching by 

the Economic Census product line 

20150 (cigars, cigarettes, tobacco, and 

smokers’ accessories), we find 

accommodation and food service 

establishments (NAICS 72) and retail 

trade establishments (NAICS 44–45) that 

report tobacco sales (Ref. 78, Ref. 79). 

Although some establishments in other 

industries may have unreported sales of 

tobacco products, the product line sales 

data provide a reasonable basis to 

determine which types of 

establishments would be affected by the 

proposed rule. 

TABLE E7—ESTABLISHMENTS WITH PAYROLL THAT SELL TOBACCO PRODUCTS, 2002 ECONOMIC CENSUS

Kind of business NAICS Number in 

NAICS 

Number selling 

tobacco 

products 

Percentage 

selling tobacco 

products 

General merchandise .................................................................................... 452 ................... 40,723 6,991 17 

Food & beverage .......................................................................................... 445 excluding 

44512.

119,592 65,255 55 

Convenience a ............................................................................................... 44512 ............... 29,212 24,871 85 

Gasoline stations with convenience a ........................................................... 44711 ............... 93,691 86,152 92 

Gasoline stations .......................................................................................... 44719 ............... 27,755 8,745 32 

Health & personal care ................................................................................. 446 ................... 81,797 17,761 22 

Other retail establishments ........................................................................... (a) ...................... 595,558 3,470 1 

Accommodation and food services ............................................................... 72 excluding 

7224.

516,734 12,347 2 

Drinking places ............................................................................................. 7224 ................. 48,856 11,490 24 

Tobacco stores ............................................................................................. 453991 ............. 6,184 6,184 100 

Nonstore retailers .......................................................................................... 454 ................... 49,000 848 2 

Vending machine operators .......................................................................... 4542 ................. 5,921 892 15 

Total ....................................................................................................... ........................... 1,615,023 245,006 15 

a Includes NAICS 441, 443, 444, 448, 451, 453 excluding 453991. 

Sources: Ref. 79; Ref. 78. 

Because the 2007 Census data on 

product line sales for retail 

establishments with employees are not 

yet available, we update the number of 

various types of retail establishments 

using 2007 Statistics of U.S. Businesses 

data but assume the share of 

establishments selling tobacco products 

is unchanged (since 2002) within each 

category. Likewise, we lack 2007 Census 

data on product line sales for 

nonemployer establishments. Without 

additional information, we assume that, 

within a NAICS category, the share of 

establishments selling tobacco products 

will be the same for nonemployer 

establishments in 2007 as for 

establishments with payroll in the 2002 

Census. As shown in Table E8, we 

estimate that about 249,000 retail 

establishments with payroll and 126,000 

nonemployer establishments sell 

tobacco products. 

TABLE E8—ESTABLISHMENTS THAT SELL TOBACCO PRODUCTS

Kind of business NAICS 

Percentage 

selling tobacco 

products a

Establishments with payroll Nonemployer establishments 

Number b

Estimated 

number selling 

tobacco 

products 

Number c

Estimated 

number selling 

tobacco 

products 

General merchandise stores ................. 452 ................... 17 47,456 8,147 32,978 5,661 

Food & beverage stores ....................... 445 excluding 

44512.

55 122,858 67,037 104,026 56,761 

Convenience stores .............................. 44512 ............... 85 28,173 23,986 (e) 

Gasoline stations with convenience 

stores.

44711 ............... 92 95,389 87,713 (e) 


emcdonald on DSK2BSOYB1PROD with PROPOSALS2
69548 Federal Register / Vol. 75, No. 218 / Friday, November 12, 2010 / Proposed Rules 

12Rotogravure, the most expensive printing 

method, is used for cigarette labeling. 

TABLE E8—ESTABLISHMENTS THAT SELL TOBACCO PRODUCTS—Continued 

Kind of business NAICS 

Percentage 

selling tobacco 

products a

Establishments with payroll Nonemployer establishments 

Number b

Estimated 

number selling 

tobacco 

products 

Number c

Estimated 

number selling 

tobacco 

products 

Gasoline stations .................................. 44719 ............... 32 20,144 6,347 9,454 2,979 

Health and personal care stores .......... 446 ................... 22 89,406 19,413 138,800 30,138 

Other retail stores ................................. (d) ...................... 1 600,537 3,499 735,266 4,284 

Accommodation and food services ....... 72 excluding 

7224.

2 585,541 13,991 281,104 6,717 

Drinking places ..................................... 7224 ................. 24 46,948 11,041 27,170 6,390 

Tobacco stores ..................................... 453991 ............. 100 6,458 6,458 (e) 

Nonstore retailers .................................. 454 excluding 

4542.

2 42,565 737 782,759 13,547 

Vending machine operators .................. 4542 ................. 15 5,158 777 27,595 4,157 

Total ............................................... ........................... 15 1,690,633 249,147 2,139,152 126,477 

aPercentage of establishments with payroll from Table E7. 

b Ref. 77. 

c Ref. 80. 

d Includes NAICS 441, 443, 444, 448, 451, 453 excluding 453991. 

e Data on nonemployer establishments unavailable for this NAICS category. 

2. Costs of Changing Cigarette Labels 

In order to estimate the cost of 

changing cigarette labels to comply with 

the proposed rule, FDA used three 

sources. The ‘‘Methodology Report’’ for 

the forthcoming ‘‘Model to Estimate 

Costs of Using Labeling as a RiskReduction Strategy for Consumer 

Products Regulated by the Food and 

Drug Administration’’ provided the 

basic framework (Ref. 81). The 

Methodology Report contains few 

numerical values, but we obtained 

preliminary estimates of several cost 

components and updated product 

counts through personal communication 

with our contractor, RTI International 

(Ref. 82). Because the forthcoming 

model is not yet complete, we filled in 

missing pieces using the RTI Final 

Report entitled ‘‘FDA Labeling Cost 

Model,’’ which describes an earlier 

model developed by RTI for FDA to 

estimate the cost of food label changes 

(Ref. 83). We were able to combine the 

models because the older food labeling 

model serves as the basis for the 

forthcoming general labeling model. 

The front and back of every cigarette 

package must be redesigned to 

incorporate graphic warnings occupying 

the entire top half. This type of change 

requires what is known as a complete 

redesign in the 2003 model or as a major 

change in the forthcoming model. In 

addition, the requirement to incorporate 

9 different warnings will increase costs 

beyond what the labeling models 

estimate. FDA accounted for the 

additional warnings by first calculating 

the cost of a complete redesign for 

cigarettes and then inflating the specific 

cost components expected to increase 

due to the requirement for 9 warnings. 

The RTI labeling models incorporate 

three potential cost components of a 

labeling change: label design costs 

(incurred on a per-UPC basis), testing 

costs (incurred on a per-formulation 

basis), and inventory costs (incurred on 

a per-unit basis). For this analysis, we 

restrict the calculation of market testing 

costs to the largest firms and perform 

certain other modifications to make the 

estimated cost match the likely effects of 

the proposed rule. The large cigarette 

manufacturers can plausibly be 

expected to conduct quantitative studies 

and focus group testing for each of their 

brands to gauge the effect of the new 

graphic warnings and to study how they 

might best be able to mitigate their 

effects. By contrast, small manufacturers 

with lower sales revenues are highly 

unlikely to conduct expensive market 

testing in response to the new 

requirements. 

We estimate that 3,234 cigarette UPCs 

(Ref. 82), would be affected by this 

proposed rule. FDA conservatively 

assumes that because the required 

change is so radical, none of the labeling 

changes can be coordinated with a 

previously-scheduled labeling change. 

Based on communication with RTI 

about the forthcoming model (Id.), FDA 

estimates that, per UPC, administrative 

labor costs are $375 to $1,014, graphic 

design labor costs are $1,120 to $3,206, 

prepress labor costs are $1,482 to 

$3,816, recordkeeping labor costs are 

$33 to $434, prepress materials costs are 

$100 to $2,439, and printing plate costs 

are $4,840 to $10,580.12 Summing these 

costs yields a per-UPC design cost of 

$7,950 to $21,489. Multiplying by the 

number of affected UPCs and inflating 

by 10 percent to account for rush 

charges associated with a compliance 

period shorter than 24 months results in 

total label design costs of $28 million to 

$76 million (Ref. 83). 

Manufacturers incur inventory costs if 

they discard unused inventory at the 

end of the compliance period. Because 

cigarette manufacturers do not keep 

large inventories of labels, FDA assumes 

that all inventory will be exhausted 

during the 15-month compliance period, 

leaving no inventory cost. Table E9 

summarizes the total costs of a standard 

label redesign for cigarettes. 


emcdonald on DSK2BSOYB1PROD with PROPOSALS2
Federal Register / Vol. 75, No. 218 / Friday, November 12, 2010 / Proposed Rules 69549 

TABLE E9—COST OF A LABEL REDESIGN FOR CIGARETTES

Low Medium High 

Label Design Cost a

Number of UPCs ......................................................................................................................... 3,234 3,234 3,234 

Administrative labor cost ($) ................................................................................................. 375 695 1,014 

Graphic design labor cost ($) ............................................................................................... 1,120 2,163 3,206 

Prepress labor cost ($) ......................................................................................................... 1,482 2,649 3,816 

Recordkeeping labor cost ($) ............................................................................................... 33 234 434 

Prepress materials ($) .......................................................................................................... 100 1,225 2,439 

Printing plate cost ($) ........................................................................................................... 4,840 7,710 10,580 

Cost per product UPC ($) ............................................................................................................ 7,950 14,676 21,489 

Total label design cost, 24-month compliance ($) ...................................................................... 25,710,300 47,462,184 69,495,426 

Total label design cost, < 24-month compliance ($) ................................................................... 28,281,330 52,208,402 76,444,969 

Total Cost ($) ............................................................................................................................... 28,281,330 52,208,402 76,444,969 

a Undiscounted costs assumed to be incurred at the start of the first period of the time horizon of this rule. 

Administrative costs, recordkeeping 

costs, and labor costs associated with 

graphic design and prepress activities 

would probably be unaffected by the 

requirement to use 9 different picturewarning pairs. By contrast, we expect 

printing plate costs and prepress 

materials costs to be 9 times as large as 

previously calculated because of the 

requirement for 9 warnings. Table E10 

shows the total costs of the cigarette 

labeling change, adjusted for the 9 

warnings. The labeling cost increases to 

$169 million to $447 million. 

TABLE E10—COST OF A LABEL REDESIGN WITH NINE WARNING LABELS

Low Medium High 

Label Design Cost a

Number of UPCs ......................................................................................................................... 3,234 3,234 3,234 

Administrative labor cost ($) ................................................................................................. 375 695 1,014 

Graphic design labor cost ($) ............................................................................................... 1,120 2,163 3,206 

Prepress labor cost ($) ......................................................................................................... 1,482 2,649 3,816 

Recordkeeping labor cost ($) ............................................................................................... 33 234 434 

Prepress materials ($) .......................................................................................................... 900 11,025 21,951 

Printing plate cost ($) ........................................................................................................... 43,560 69,390 95,220 

Cost per UPC ($) ......................................................................................................................... 47,470 86,156 125,641 

Total label design cost, 24-month compliance ($) ...................................................................... 153,517,980 278,628,504 406,322,994 

Total label design cost, < 24-month compliance ($) ................................................................... 168,869,778 306,491,354 446,955,293 

Total Cost ($) ............................................................................................................................... 168,869,778 306,491,354 446,955,293 

a Undiscounted costs assumed to be incurred at the start of the first period of the time horizon of this rule. 

3. Market Testing Costs Associated With 

Changing Cigarette Package Labels 

As stated above, FDA expects that 

only the large manufacturers will 

conduct market tests for their brands. 

Using several state directories of 

certified tobacco products, FDA 

estimates that 75 brands are marketed 

by the 4 largest domestic manufacturers 

(Refs. 84–89). The cost of focus group 

tests is estimated to range from $18 to 

$42 thousand; the cost of a quantitative 

study is estimated to range from $47 to 

$453 thousand (Ref. 82). The total cost 

of both types of market testing is 

estimated to be $65 to $495 thousand 

per brand. Multiplying by 75 brands 

yields a total cost estimate ranging from 

$5 to $37 million with a medium 

estimate of $11 million, as shown in 

Table E11. We assume that the 

requirement to use 9 different warningtext pairs does not affect these costs. 

TABLE E11—COST OF MARKET TESTING

Low Medium High 

Market Testing Cost a

Number of brands to be tested ................................................................................................... 75 75 75 

Cost of focus group testing ($) ............................................................................................. 18,000 30,000 42,000 

Cost of quantitative studies ($) ............................................................................................ 47,000 114,000 453,000 

Market testing cost per brand ($) ................................................................................................ 65,000 144,000 495,000 

Total Market Testing Cost ($) ...................................................................................................... 4,875,000 10,800,000 37,125,000 

a Undiscounted costs assumed to be incurred at the start of the first period of the time horizon of this rule. 

4. Advertising Restrictions: Removal of 

Noncompliant Point-of-Sale Advertising 

The principal effect of the restrictions 

on advertising in the proposed rule stem 

from the requirement that retailers and 

manufacturers of cigarettes remove any 

point-of-sale advertising for cigarettes 

that fails to conform to the 

requirements. In this analysis, we 

estimate the social resource costs for the 

removal. In the analysis of FDA’s 1996 

final tobacco rule, we based much of our 

estimate of the cost of removing 

noncompliant point-of-sale advertising 

on a report from the Barents Group that 


emcdonald on DSK2BSOYB1PROD with PROPOSALS2
69550 Federal Register / Vol. 75, No. 218 / Friday, November 12, 2010 / Proposed Rules 

used average removal costs for seven 

types of retail establishments, calculated 

using in-store surveys conducted by 

A.T. Kearney, Inc (61 FR 44580). We use 

the same baseline and retain our 

assumptions from 1996 about the level 

of effort required. We acknowledge, 

however, that this approach may 

overstate or understate the costs for a 

particular action or type of business. 

Table E12 regroups the information 

from Table E8 according to the 

categories studied by AT Kearney. 

Because our analysis considers only the 

removal of point-of-sale advertising 

from physical retail locations, we do not 

include non-store establishments. Table 

E13 shows that in current dollars onetime per-establishment costs range from 

about $12 for ‘‘other establishments’’ to 

about $198 for convenience stores. To 

estimate the total costs to comply with 

the restriction on point-of-sale 

advertising, we apply the updated perestablishment costs from Table E13 to 

affected establishments. As shown in 

Table E14, the one-time costs to remove 

point-of-sale materials would total $45.4 

million. 

TABLE E12—ESTIMATED NUMBER OF ESTABLISHMENTS SELLING CIGARETTE PRODUCTS AFFECTED BY THE PROPOSED

RULE

Kind of business 

Establishments with 

payroll a

Nonemployer 

establishments aTotal 

AT Kearney Category 

General Merchandise ........................................................................................................... 8,147 5,661 13,808 

Supermarket & Grocery ........................................................................................................ 67,037 56,761 123,799 

Convenience Stores ............................................................................................................. 23,986 ........................ 23,986 

Convenience Stores with Gas .............................................................................................. 87,713 ........................ 87,713 

Service Stations .................................................................................................................... 6,347 2,979 9,326 

Drug Stores .......................................................................................................................... 19,413 30,138 49,552 

Specialty Tobacco Stores ..................................................................................................... 6,458 ........................ 6,458 

Other establishments b ......................................................................................................... 28,531 17,391 45,922 

Total ............................................................................................................................... 247,633 112,931 360,564 

aSource: Table E8. 

b Includes miscellaneous retail establishments and accommodations and food services establishments (including drinking places), but excludes 

nonstore retailers. 

TABLE E13—ESTIMATED AVERAGE PER-ESTABLISHMENT COSTS TO REMOVE PROHIBITED MATERIALS a

AT Kearney business category 

Remove promotional materials ($) 

1996 dollars Current dollars 

General Merchandise .................................................................................................................................. 23.42 30.94 

Supermarket & Grocery ............................................................................................................................... 125.14 165.30 

Convenience Stores .................................................................................................................................... 150.02 198.16 

Convenience Stores with Gas ..................................................................................................................... 146.43 193.42 

Service Stations ........................................................................................................................................... 36.09 47.67 

Drug Stores .................................................................................................................................................. 11.72 15.48 

Specialty Tobacco Stores ............................................................................................................................ 123.21 162.75 

Other establishments b ................................................................................................................................. 9.37 12.38 

aSources: 61 FR 44585, Table 8; 1996 to 2009 (most recent) GDP deflator rose 32.1% (Ref. 76). 

bExcludes adult-only establishments, nonstore retailers and vending machine operators. 

TABLE E14—ESTIMATED ONE-TIME COSTS TO REMOVE POINT-OF-SALE MATERIALS FROM AFFECTED ESTABLISHMENTS

A.T. Kearney category Number of establishments 

Average cost 

($) 

Total one-time 

costs b

($ million) 

General Merchandise .................................................................................................................. 13,808 30.94 0.4 

Supermarket & Grocery ............................................................................................................... 123,799 165.30 20.5 

Convenience Stores .................................................................................................................... 23,986 198.16 4.8 

Convenience Stores with Gas ..................................................................................................... 87,713 193.42 17.0 

Service Stations ........................................................................................................................... 9,326 47.67 0.4 

Drug Stores .................................................................................................................................. 49,552 15.48 0.8 

Specialty Tobacco Stores ............................................................................................................ 6,458 162.75 1.1 

Other establishments a ................................................................................................................. 45,922 12.38 0.6 

Total ...................................................................................................................................... 360,564 ........................ 45.4 

aExcludes adult-only establishments and non-store retailers. 

b Undiscounted costs assumed to be incurred at the start of the first period of the time horizon of this rule. 


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Sources: Tables E12 and E13. 

5. Government Administration and 

Enforcement Costs 

FDA’s estimated internal costs for 

administering and enforcing this 

regulation are uncertain. As a best 

estimate, however, FDA projects that 25 

full-time equivalent employees (FTEs) 

would be needed to implement the 

proposed rule. Fully loaded employee 

costs vary with the type of employee 

(e.g. field inspectors versus 

administrative), but an average of 

$247,049 per FTE places the dollar cost 

at approximately $6.2 million per year. 

6. Summary of Costs 

Table E15 summarizes the cost 

estimates from the preceding sections 

and Table E16 displays the present 

value and annualized value of costs. 

TABLE E15—SUMMARY OF COSTS

Requirements of the rule Annual ($m) a

One-Time ($m) b

Low Medium High 

Private Sector 

Labeling Change ...................................................................................... ........................ 168.9 306.5 447.0 

Market Testing .......................................................................................... ........................ 4.9 10.8 37.1 

Point-of-Sale Advertising .......................................................................... ........................ 45.4 45.4 45.4 

Subtotal ............................................................................................. ........................ 219.2 362.7 529.5 

Government 

FDA ........................................................................................................... 6.2 ........................ ........................ ........................

Subtotal ............................................................................................. 6.2 ........................ ........................ ........................

Total ................................................................................................... 6.2 219.2 362.7 529.5 

a Undiscounted annual costs assumed to be incurred at the end of each period for a total of 20 years. 

b Undiscounted one-time costs assumed to be incurred at the start of the first period of the time horizon of this rule. 

TABLE E16—PRESENT VALUE AND ANNUALIZED VALUE OF COSTS a

Requirements of the rule 

Present value ($ mil) Annualized costs ($ mil) 

3 percent 7 percent 3 percent 7 percent 

Low Med. High Low Med. High Low Med. High Low Med. High 

Private Sector 

Labeling Change ............................... 164.0 297.6 433.9 157.8 286.4 417.7 11.0 20.0 29.2 14.9 27.0 39.4 

Market Testing .................................. 4.7 10.5 36.0 4.6 10.1 34.7 0.3 0.7 2.4 0.4 1.0 3.3 

Point-of-Sale Advertising .................. 44.1 44.1 44.1 42.5 42.5 42.5 3.0 3.0 3.0 4.0 4.0 4.0 

Subtotal ...................................... 212.8 352.2 514.1 204.8 339.0 494.9 14.3 23.7 34.6 19.3 32.0 46.7 

Government 

FDA ................................................... 89.2 89.2 89.2 61.2 61.2 61.2 6.0 6.0 6.0 5.8 5.8 5.8 

Subtotal ...................................... 89.2 89.2 89.2 61.2 61.2 61.2 6.0 6.0 6.0 5.8 5.8 5.8 

Total .................................... 302.0 441.4 603.3 266.0 400.2 556.0 20.3 29.7 40.6 25.1 37.8 52.5 

aThe present value of upfront costs differs from previous tables because here these costs have been discounted 1 year back to 2010. Similarly, annual costs have been discounted back to 2010 before being annualized, resulting in a slight difference between annual and annualized 

costs. 

E. Cost-Effectiveness Analysis 

We measure the effectiveness of the 

proposed rule as the sum of saved lifeyears and quality-adjusted life years. In 

order to assess the cost-effectiveness of 

the proposed rule, we must adjust the 

costs to account for effects that are not 

captured by life-years or qualityadjusted life years. As shown in detail 

in the previous section, we calculated 

the first twenty years’ costs attributable 

to the proposed rule and found present 

values of $266.0 to $556.0 million 

(using a 7 percent discount rate) or 

$302.0 to $603.3 million (using a 3 

percent discount rate). We add to each 

total the estimated monetary value of 

lost consumer surplus (previously 

netted out of life-years and emphysema 

benefits estimates); this yields overall 

costs of $2.14 to $6.17 billion (using a 

7 percent discount rate) or $9.47 to 

$28.10 billion (using a 3 percent 

discount rate). In order to focus on the 

costs associated with extensions of 

quality-adjusted life (see Ref. 68 at pp. 

11–12), we then subtract both medical 

cost reductions and the value of 

property savings due to reductions in 

accidental fires and arrive at a net cost 

of $1.88 to $5.91 billion (using a 7 

percent discount rate) or $8.93 to $27.57 

billion (using a 3 percent discount rate). 

Discounting over the same twentyyear time period, we calculate that this 

proposed rule would lead to 476,000 to 

549,000 discounted smoking 

preventions or cessations. Similarly, we 

find that 34,627 to 171,660 discounted 

quality-adjusted life-years would be 

saved (this includes both fractional lifeyears associated with reduced 

emphysema and full life-years 

associated with reduced premature 


emcdonald on DSK2BSOYB1PROD with PROPOSALS2
69552 Federal Register / Vol. 75, No. 218 / Friday, November 12, 2010 / Proposed Rules 

13This total reflects reduced premature mortality 

for smokers themselves and for others caught in the 

path of cigarette-related fires. The National Fire 

Protection Association (Ref. 90) reports the 

percentages of fire fatalities by age category; along 

with the CDC’s estimate of average American life 

expectancy (Ref. 91), these data allow FDA to 

calculate that the expected number of life-years lost 

by fire victims is 37.3. 

mortality).13 This yields a cost per 

smoking prevention of $3,940 to 

$50,204, and a cost per life-year saved 

of $52,047 to $170,552. 

TABLE E17—COST-EFFECTIVENESS

Cost ($) 

3 Percent 7 Percent 

Low Medium High Low Medium High 

Per Smoking Prevention .................................................. 16,271 33,217 50,204 3,940 8,149 12,403 

Per Life-Year Saved ........................................................ 52,047 106,255 160,594 54,176 112,050 170,552 

F. Distributional Effects 

This proposed rule would bring about 

a variety of distributional effects not yet 

discussed in detail. Sectors affiliated 

with tobacco and tobacco products 

would lose sales revenues. 

Simultaneously, non-tobacco-related 

industries would gain sales, because 

dollars not spent for tobacco products 

would be spent on other commodities. 

1. Tobacco Manufacturers, Distributors, 

and Growers 

FDA estimates that implementation of 

the proposed regulation may reduce the 

annual cigarette consumption of U.S. 

smokers by 80 million packs. 

Meanwhile, the FTC (Ref. 39) reports 

that, in 2006, 1.75 billion cigarette packs 

were manufactured and distributed to 

consumers. These numbers imply that 

tobacco manufacturer revenues would 

be 0.68 percent lower in the rule’s first 

year, and 0.79 percent lower in 2031, 

than they were in 2006. The U.S. Census 

Bureau (Ref. 92) reports that tobacco 

manufacturers’ revenues totaled $41.6 

billion in 2006; hence, the rule-induced 

decrease in annual tobacco sales would 

range from approximately $284 to $328 

million. These estimates would rise 

somewhat higher if we were accounting 

for the decrease in price that 

accompanies the decrease in demand for 

a good (in this case, cigarettes). 

Experimental evidence from Mexico 

(Ref. 93) indicates that graphic warning 

labels may decrease smokers’ 

willingness-to-pay for cigarettes by 17 

percent; however, without supply 

elasticity data, we cannot determine 

how much this decline in willingnessto-pay would change cigarettes’ market 

price. 

We estimate that the tobacco 

manufacturing, warehousing and 

wholesale trade sectors employ about 

74,000 full-time workers (Ref. 77). 

Under the assumption of constant 

production-to-employment ratio, we 

project that a 0.68–0.79 percent 

reduction in sales would result in the 

displacement of 500–600 jobs among 

manufacturers, warehouses, and 

wholesalers. 

Effects of the rule would also be 

observed in the agricultural sector. 

According to USDA’s 2007 Census of 

Agriculture (Ref. 94), there are 16,234 

tobacco farms. Upon implementation of 

the proposed rule, these farms may shift 

some of their acreage from growing 

tobacco to producing other agricultural 

products. 

2. National and Regional Employment 

Patterns 

Several studies estimate the 

contribution of tobacco to the U.S. 

economy or, alternatively, the losses to 

the U.S. economy that would follow a 

decline in tobacco-related consumption. 

Economists have shown both 

theoretically and empirically that, for 

the nation as a whole, employment 

gains from spending on other products 

would offset any employment losses 

from reduced spending on tobacco 

products (Ref. 95). The major tobaccogrowing states, however, would 

experience some adverse economic 

effects. An economic simulation of the 

regional impacts of spending on tobacco 

products carried out in 1994 found that 

after 8 years, a 2 percent per year fall in 

tobacco consumption (which 

substantially exceeds the FDA forecast 

for this regulation) would cause the loss 

of 36,600 jobs for the Southeast Tobacco 

region of the United States (0.2 percent 

of regional employment), whereas the 

nontobacco regions of the United States 

would gain 56,300 jobs (Ref. 96). That 

study, if carried out today, would find 

a much smaller net effect because total 

employment in tobacco-related 

industries has fallen. Overall, FDA finds 

that the income and employment 

impacts associated with reduced 

tobacco consumption would be quite 

small. 

3. Retail Sector 

As would tobacco growers, 

distributors and manufacturers, tobacco 

retailers would be affected by any 

decrease in cigarette sales. Retailers 

would, however, be in a position to shift 

shelf space and promotional activities to 

non-tobacco products, in order to take 

advantage of the increase in demand for 

other products that would be expected 

to accompany the decrease in spending 

on cigarettes. 

4. Advertising Industry 

The overall impact of the proposed 

rule on the advertising industry is 

uncertain. Advertiser revenue may 

decrease because advertisements with 

graphic warning labels are less desirable 

from a cigarette seller’s standpoint and 

thus tobacco manufacturers would 

choose to conduct less advertising. On 

the other hand, advertising industry 

revenue may increase due to cigarette 

sellers’ need to re-design ads to 

accommodate new warning labels and 

to devise new promotional strategies. In 

either case, few net social costs or 

benefits would be generated. Moreover, 

the effect on advertising would likely be 

relatively small since spending on 

cigarette advertising has been declining 

substantially in recent decades. By 

2006, expenditures on magazine 

advertising had fallen to about $50 

million and outdoor advertising to 

under $1 million. Most of the remaining 

affected advertising expenditures were 

point-of sale promotions, which totaled 

$240 million (Ref. 39). 

5. Excise Tax Revenues 

In 2009, Federal tobacco tax revenues 

totaled $16.3 billion, while state and 

local tax revenues totaled $16.5 billion 

(Ref. 97). The proposed rule would 

decrease government tobacco tax 

revenues as fewer Americans consume 

cigarettes. 

FDA estimates this change in excise 

tax revenues by multiplying together the 

percentage change in smoking, whose 

calculation was described in section C1, 

the projected population in a given year 

(Ref. 65), age-appropriate discounted 

lifetime cigarette consumption (in 


emcdonald on DSK2BSOYB1PROD with PROPOSALS2
Federal Register / Vol. 75, No. 218 / Friday, November 12, 2010 / Proposed Rules 69553 

packs) per smoker, and current Federal 

and average state tax rates (Ref. 98; Ref. 

99). FDA calculates average 

consumption for 15-year-olds, 16- to 17- 

year-olds, and 18- to 23-year-olds using 

the May 2006, August 2006, and January 

2007 Tobacco Use Supplements to the 

Current Population Survey (Ref. 100). 

Sloan et al. (Ref. 66) report lifetime 

discounted consumption for typical 24- 

year-old smokers. 

FDA estimates that annual ruleinduced decreases in excise tax 

collections would be approximately 

$106 million for state governments and 

$80.5 million for the Federal 

government. Assuming that excise taxes 

rise, on average, at the rate of inflation 

allows us to sum these values over the 

time horizon of our analysis, yielding an 

overall revenue loss to state 

governments of $1.35 to $2.93 billion 

and to the Federal government of $1.03 

to $2.23 billion. Given inelastic cigarette 

demand (Ref. 95), some state 

governments could raise tobacco 

product excise rates to offset these 

revenue losses. 

G. International Effects 

Of the $87.9 billion worth of tobacco 

products consumed in the United States 

in 2009 (Ref. 101), only $156 million 

consisted of imported cigarettes, with 

another $897 million imported as 

tobacco in a less-processed state (Ref. 

102; Ref. 103). As in the United States, 

foreign manufacturers, distributors, and 

growers of tobacco and tobacco products 

would lose revenue as a result of the 

proposed rule, though their loss would 

be a small fraction of the overall 

revenue loss. As consumers who would 

have been smokers purchase other 

products, there would be a shift in 

patterns of international trade. If the 

preferred substitute products are 

American-made, there would be a (very 

small) decrease in overall imports into 

the United States; otherwise, there 

would be a small increase in imports 

from the source countries of the newlydemanded goods and services and a 

corresponding decrease in imports from 

tobacco-producing countries. 

The proposed rule does not apply to 

cigarettes manufactured for export, 

whose value totaled $417 million in 

2009 (Ref. 102). 

H. Regulatory Alternatives 

We compare the proposed rule to two 

hypothetical alternatives: An otherwise 

identical rule with a 24-month 

compliance period and an otherwise 

identical rule with a 6-month 

compliance period. Even though we 

estimate costs and benefits for these 

alternatives, they do not provide viable 

regulatory options, as they are 

inconsistent with FDA’s statutory 

mandate. 

1. 24-Month Compliance Period 

The cost of the labeling changes for 

this proposed rule depends far less than 

most labeling rules on the compliance 

period. The main effect of a longer 

compliance period would be to 

eliminate the 10 percent premium for 

overtime and rush charges added to the 

per-UPC label design activities for 

compliance periods shorter than 24 

months (Ref. 83). All other costs are the 

same as in the 15-month analysis. 

Table E18 shows that extending the 

compliance period to 24 months would 

reduce the up-front labeling change cost 

by $15 to $41 million, to a total of $154 

to $406 million. 

TABLE E18—COST OF A CIGARETTE LABEL REDESIGN WITH NINE WARNINGS WITH A 24–MONTH COMPLIANCE PERIOD a

Low Medium High 

Label Design Cost 

Number of UPCs ......................................................................................................................... 3,234 3,234 3,234 

Administrative labor cost ($) ................................................................................................. 375 695 1,014 

Graphic design labor cost ($) ............................................................................................... 1,120 2,163 3,206 

Prepress labor cost ($) ......................................................................................................... 1,482 2,649 3,816 

Recordkeeping labor cost ($) ............................................................................................... 33 234 434 

Prepress materials ($) .......................................................................................................... 900 11,025 21,951 

Printing plate cost ($) ........................................................................................................... 43,560 69,390 95,220 

Cost per product UPC ($) ............................................................................................................ 47,470 86,156 125,641 

Total label design cost, 24-month compliance ($) ............................................................... 153,517,980 278,628,504 406,322,994 

Total Cost ($) ........................................................................................................................ 153,517,980 278,628,504 406,322,994 

Change from 15-month Compliance Period ................................................................................ ¥15,351,798 ¥27,862,850 ¥40,632,299 

a Undiscounted costs assumed to be incurred at the start of the first period of the time horizon of this rule. 

Extending the compliance period to 

24 months would delay the accrual of 

health and fire reduction benefits by 

nine months. An approximation of the 

effect of this delay may be found by 

discounting, at three and seven percent 

discount rates, the previously-calculated 

total benefits. As shown in Table E19, 

FDA finds that a 24-month compliance 

period would decrease benefits by 

between $113.5 and $622.5 million. 

TABLE E19—PRESENT VALUE OF BENEFITS WITH 24-MONTH COMPLIANCE PERIOD ($ MIL) 

VSLY = $105,000 VSLY = $210,000 VSLY = $315,000 

3% 

Discount rate 

7% 

Discount rate 

3% 

Discount rate 

7% 

Discount rate 

3% 

Discount rate 

7% 

Discount rate 

Life-Years ................................................. 8,767.3 1,715.6 17,534.7 3,431.3 26,302.0 5,146.9 

Non-Fatal Emphysema ............................ 197.6 61.7 395.3 123.4 592.9 185.0 

Fire Loss .................................................. 384.5 171.7 384.5 171.7 384.5 171.7 

Medical Expenditure Reduction ............... 487.9 231.9 487.9 231.9 487.9 231.9 

Total .................................................. 9,837.4 2,180.9 18,802.4 3,958.3 27,767.3 5,735.6 


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14The AC Nielsen data for total equivalent units 

show sales totaling 38,632 million sticks in 2008 

(Ref. 104), whereas The Maxwell Report states that 

industry volume was 345,300 million sticks in 2008 

(Ref. 105). Thus the Nielsen data capture 38,632/ 

345,300 = 11.2 percent of cigarettes sold. Nielsen 

data show total sales units of 1.195 billion in 2008. 

Dividing by 0.112 yields an estimate of 10.7 billion 

sales units per year. 

TABLE E19—PRESENT VALUE OF BENEFITS WITH 24-MONTH COMPLIANCE PERIOD ($ MIL)—Continued 

VSLY = $105,000 VSLY = $210,000 VSLY = $315,000 

3% 

Discount rate 

7% 

Discount rate 

3% 

Discount rate 

7% 

Discount rate 

3% 

Discount rate 

7% 

Discount rate 

Change from 15-Month Compliance Period ........................................................ ¥220.5 ¥113.5 ¥421.5 ¥206.0 ¥622.5 ¥298.6 

2. Six-Month Compliance Period 

In the 2003 labeling-cost model, 

overtime and rush charges equal 10 

percent of the per-UPC label design 

costs with a 6-month compliance 

period. The model further assumes that 

12 months is the shortest compliance 

period that can be met without resorting 

to covering up the old labels with 

stickers as a temporary solution. 

Therefore, the cost of discarded 

inventory is the same as under a 12- 

month compliance period, but there is 

an additional cost for applying 

appropriate stickers to cover the old 

package label design for a period of 6 

months. 

FDA assumes that no additional 

inventory will remain unused after 6 

months of applying stickers. The 

number of units sold annually is about 

10.7 billion.14 Therefore, 5.3 billion 

units would be relabeled with stickers. 

We estimate the per-unit cost for the 

sticker and application cost to be 

between $0.017 and $0.045 (Ref. 83). 

Reducing the compliance period to 6 

months would then increase compliance 

costs by $91 to $239 million to a total 

of $259 to $686 million. The use of 9 

graphic-text combinations is not 

expected to materially affect this cost. 

TABLE E20—COST OF A CIGARETTE LABEL REDESIGN WITH NINE WARNINGS WITH A SIX-MONTH COMPLIANCE PERIOD a

Low Medium High 

Label Design Cost 

Number of UPCs ......................................................................................................................... 3,234 3,234 3,234 

Administrative labor cost ($) ................................................................................................. 375 695 1,014 

Graphic design labor cost ($) ............................................................................................... 1,120 2,163 3,206 

Prepress labor cost ($) ......................................................................................................... 1,482 2,649 3,816 

Recordkeeping labor cost ($) ............................................................................................... 33 234 434 

Prepress materials ($) .......................................................................................................... 900 11,025 21,951 

Printing plate cost ($) ........................................................................................................... 43,560 69,390 95,220 

Cost per product UPC ($) ............................................................................................................ 47,470 86,156 125,641 

Total label design cost, 24-month compliance ($) ...................................................................... 153,517,980 278,628,504 406,322,994 

Total label design cost, < 24-month compliance ($) ................................................................... 168,869,778 306,491,354 446,955,293 

Sticker Costs 

Stick and application costs per unit ($) ................................................................................ 0.017 0.031 0.045 

Number of units sold in 6 months ........................................................................................ 5,338,051,475 5,338,051,475 5,338,051,475 

Total sticker cost ($) ............................................................................................................. 90,501,325 168,073,889 239,182,072 

Total Cost ($) ............................................................................................................................... 259,371,103 474,565,243 686,137,366 

Change from 15-month Compliance Period ................................................................................ 90,501,325 168,073,889 239,182,072 

a Undiscounted costs assumed to be incurred at the start of the first period of the time horizon of this rule. 

Reducing the compliance period to 

six months would hasten the accrual of 

health and fire reduction benefits by 

nine months. An approximation of the 

effect of this change in timing may be 

found by compounding, at three and 

seven percent discount rates, the 

previously-calculated total benefits. As 

shown in Table E21, FDA finds that a 

six-month compliance period would 

increase benefits by between $119.4 and 

$636.4 million. 

TABLE E21—PRESENT VALUE OF BENEFITS WITH SIX-MONTH COMPLIANCE PERIOD ($ MIL) 

VSLY = $105,000 VSLY = $210,000 VSLY = $315,000 

3% 

Discount rate 

7% 

Discount rate 

3% 

Discount rate 

7% 

Discount rate 

3% 

Discount rate 

7% 

Discount rate 

Life-Years ................................................. 9,164.8 1,898.9 18,329.6 3,797.8 27,494.4 5,696.7 

Non-Fatal Emphysema ............................ 206.6 68.3 413.2 136.5 619.8 204.8 

Fire Loss .................................................. 401.9 190.0 401.9 190.0 401.9 190.0 

Medical Expenditure Reduction ............... 510.0 256.7 510.0 256.7 510.0 256.7 

Total .................................................. 10,283.4 2,413.9 19,654.8 4,381.1 29,026.2 6,348.2 

Change from 15-Month Compliance Period ........................................................ 225.5 119.4 430.9 216.8 636.4 314.1 


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3. Summary of Regulatory Alternatives 

Table E22 summarizes the regulatory 

alternatives by displaying ranges for the 

present values of the total benefits and 

total costs. Estimated ranges for the cost 

ratios (per smoking prevention and per 

life-year saved) of the proposed rule and 

its regulatory alternatives appear in 

Table E23. 

TABLE E22—SUMMARY OF REGULATORY ALTERNATIVES

Compliance period 

Present value of total benefits ($ mil) a Present value of total costs ($ mil) b

3% 7% 3% 7% 

24-Month Total ................................................. 9,837.4 to 27,767.3 ... 2,180.9 to 5,735.6 ..... 285.2 to 561.9 ........... 248.6 to 515.0. 

(Proposed Rule) 15-Month Total ..................... 10,057.9 to 28,389.8 2,294.5 to 6,034.1 ..... 302.0 to 603.3 ........... 266.0 to 556.0. 

6-Month Total ................................................... 10,283.4 to 29,026.2 2,413.9 to 6,348.2 ..... 391.9 to 837.5 ........... 353.8 to 782.7. 

a Range in benefits is based on a VSLY of $105,000 to $315,000. 

b Range in costs is based on low cost and high cost values. 

TABLE E23—INCREMENTAL COST-EFFECTIVENESS OF REGULATORY ALTERNATIVES

Discount rate = 3 percent Discount rate = 7 percent 

Low Incremental 

CE * High Incremental CE * Low Incremental CE * High Incremental CE * 

24-Month Compliance: 

Per Smoking Prevention ... $16,252 N/A $50,152 N/A $3,819 N/A $12,024 N/A 

Per Life-Year Saved ......... 51,986 N/A 160,426 N/A 52,512 N/A 165,336 N/A 

15-Month Compliance: 

Per Smoking Prevention ... 16,271 $17,121 50,204 $52,545 3,940 $9,337 12,403 $29,324 

Per Life-Year Saved ......... 52,047 54,768 160,594 168,081 54,176 128,383 170,552 403,225 

6-Month Compliance: 

Per Smoking Prevention ... 16,419 23,021 50,597 68,133 4,207 16,118 13,170 47,376 

Per Life-Year Saved ......... 52,521 73,641 161,852 217,946 57,847 221,637 181,095 651,438 

* As the compliance period decreases, the number of rule-induced smoking preventions and life-years saved increases. Hence, the incremental 

costs of 15-Month Compliance are calculated relative to 24-Month Compliance, and the incremental costs of 6-Month Compliance are calculated 

relative to 15-Month Compliance. 

I. Impact on Small Entities 

The Regulatory Flexibility Act 

requires agencies to prepare an initial 

regulatory flexibility analysis if a 

proposed rule would have a significant 

effect on a substantial number of small 

entities. We expect this proposed rule to 

have a significant effect on a substantial 

number of small entities. Consequently, 

this analysis, together with other 

relevant sections of this document, 

serves as the Initial Regulatory 

Flexibility Analysis, as required under 

the Regulatory Flexibility Act. 

1. Description and Number of Affected 

Small Entities 

The proposed rule would affect small 

entities in several industries, from 

tobacco farming to the retail industry. 

Most of the nation’s 16,234 tobacco 

farms are small; between 90.7 and 95.8 

percent (between 14,732 and 15,555) of 

the farms growing tobacco in 2007 had 

total farm sales under the U.S. Small 

Business Administration (SBA) small 

business size standard of $750,000 (Ref. 

94; Ref. 106). 

Table E24 shows the breakdown of 

domestic cigarette manufacturers by 

employment size. Census data indicate 

that most cigarette manufacturing firms 

are small businesses, with only 4 of 24 

firms employing more than 500 

employees, while the small business 

size standard established by the SBA for 

this industry is 1,000, so a minimum of 

20 small cigarette manufacturers would 

be affected (Ref. 77; Ref. 106). 

TABLE E24—CIGARETTE MANUFACTURERS BY NUMBER OF EMPLOYEES

Size by number of employees Number of 

firms 

Less than 20 ............................. 9 

20 to 99 .................................... 7 

100 to 499 ................................ 4 

Source: Ref. 106. 

SBA size standard: 1,000 employees. 

Statistics of U.S. Businesses data 

show that 1,067 of 1,159 tobacco 

wholesale trade firms (92 percent) 

employ fewer than the 100-employee 

threshold that constitutes a small 

business according to the SBA (Ref. 77; 

Ref. 106). If the size distribution of 

cigarette importers is similar to that of 

all tobacco wholesale trade firms, then 

92 percent of them would be affected 

small businesses. 

Also likely to be affected by the 

regulation are small retail and service 

entities that sell cigarettes. Retail 

establishments bear shared 

responsibility with manufacturers for 

the cost of removing noncompliant 

advertising. SBA size standards for the 

retail trade and the accommodations 

and food services industries differ from 

size categories used by the U.S. Census. 

Table E25 shows the 2002 Census size 

categories that most closely match the 

SBA size standards. In all cases, the 

closest Census size category is smaller 

than the SBA size standard. As a 

consequence, any estimate based on the 

Census size categories may 

underestimate the number of small 

entities. 


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TABLE E25—SBA SIZE STANDARDS AND CENSUS SIZE CATEGORIES FOR RETAIL AND SERVICE FIRMS IN NAICS 

CATEGORIES WITH TOBACCO PRODUCT LINE SALES a

NAICS with tobacco product line 

sales Description of NAICS category 

SBA size 

standard 

(employees 

or $ million) 

Census size 

category 

(employees 

or $ million) 

General Merchandise 

452990 ........................................ Other General Merchandise ........................................................................ 11 ................ 10. 

452 excluding 452990 ................ Department, Discount Department, Warehouse Clubs, and Superstores .. 27 ................ 25. 

Supermarket and Grocery 

4452 and 4453 ............................ Other Food and Beverage Stores ............................................................... 7 .................. 5. 

445110 ........................................ Supermarkets and Grocery .......................................................................... 27 ................ 25. 

445120 ........................................ Convenience Stores ..................................................................................... 27 ................ 25. 

447110 ........................................ Convenience Stores with Gas ..................................................................... 27 ................ 25. 

447190 ........................................ Service Stations ........................................................................................... 9 .................. 5. 

446 .............................................. Health and Personal Care Stores ................................................................ 7 .................. 5. 

453991 ........................................ Specialty Tobacco Stores ............................................................................ 7 .................. 5. 

B .................................................. Other Kinds of Business .............................................................................. Varies .......... Varies. 

Source: Refs. 106–108. 

a Includes only firms with payroll. 

b Includes NAICS 4413, 443112, 444, 448, 451, 4532, 453998, 72 (excluding 72231), 722310. 

The Census reports establishment 

numbers for business by product line, 

and establishment and firm size by type 

of business, but provides no size data by 

type of business and product line. To 

estimate the number of affected entities 

that SBA classifies as small, we begin by 

counting the number of firms that fall 

below the Census size standard shown 

in Table E25, including only firms in 

NAICS categories with tobacco product 

line sales. Next, we calculate the 

percentage of small firms in each NAICS 

category. Depending on the type of 

business, the percentage of small firms 

ranges from 41 percent for Discount 

Department, Warehouse Clubs, and 

Superstores to almost 100 percent for 

Convenience Stores. 

TABLE E26—ESTIMATED PERCENTAGE OF SMALL RETAIL AND SERVICE FIRMS IN NAICS CATEGORIES WITH TOBACCO

PRODUCT LINE SALES a

NAICS Description of NAICS category Number of 

firms 

Number of 

firms below 

census size 

standard b

Percentage 

of small 

firms 

General Merchandise 

452110, 452910 ................................ Discount Department, Warehouse Clubs, and Superstores .... 88 36 40.9 

452990 .............................................. Other General Merchandise ..................................................... 7,451 7,320 98.2 

General Merchandise Subtotal ................................................................................................... 7,539 7,356 97.6 

Supermarket & Grocery 

445110 .............................................. Supermarkets & Grocery ......................................................... 34,017 33,328 98.0 

4452 and 4453 .................................. Other Food and Beverage Stores ............................................ 34,807 34,082 97.9 

Supermarket & Grocery Subtotal ................................................................................................... 68,824 67,410 97.9 

445120 .............................................. Convenience Stores ................................................................. 18,705 18,676 99.8 

447110 .............................................. Convenience Stores with Gas ................................................. 37,437 36,848 98.4 

447190 .............................................. Service Stations ....................................................................... 19,822 18,103 91.3 

4461 .................................................. Drug Stores .............................................................................. 36,198 33,894 93.6 

453991 .............................................. Tobacco Stores ........................................................................ 3,238 3,017 93.2 

Other Kinds of Business .......................................................... 589,400 572,619 97.2 

Source: Refs. 107, 108, 78, 79. 

a Includes only firms with payroll. 

bBased on the Census size standards shown in Table E25. 

Finally, we apply the percentages in 

Table E26 to our current estimate of the 

number of affected establishments with 

payroll (Table E7). This approach 

implicitly assumes that small 

establishments are similar whether or 

not they sell tobacco products. In 

addition, we classify all nonemployer 

establishments as small. In total, we 

estimate that about 355,000 small retail 

and service establishments would be 

affected by the proposed rule. This 

number represents about 98 percent of 

the estimated 361,000 establishments 

selling tobacco products. 


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15 In 2008, 9.9 billion out of 345.3 billion 

individual cigarettes sold were imported. FDA 

assumes the same proportion holds for UPCs. These UPCs should not overlap with those produced by 

the 4 largest domestic producers. 

TABLE E27—ESTIMATED NUMBER OF SMALL ESTABLISHMENTS WITH TOBACCO PRODUCT LINE SALES BY KIND OF

BUSINESS

Kind of business Percentage of 

small a

Number with 

payroll b

Small with 

payroll 

Nonemployers b

Estimated 

total number 

of small 

establishments 

General Merchandise ........................................................... 97.6 8,147 7,949 5,661 13,611 

Supermarket & Grocery ....................................................... 98.0 67,037 65,679 56,761 122,441 

Convenience Stores ............................................................. 99.8 23,986 23,949 0 23,949 

Convenience Stores with Gas ............................................. 98.4 87,713 86,333 0 86,333 

Service Stations ................................................................... 91.3 6,347 5,797 2,979 8,775 

Drug Stores .......................................................................... 93.6 19,413 18,178 30,138 48,316 

Specialty Tobacco Stores .................................................... 93.2 6,458 6,017 0 6,017 

Other Establishments ........................................................... 97.2 28,531 27,719 17,391 45,110 

Total .............................................................................. ........................ 247,633 241,621 112,931 354,552 

aFrom Table E26. 

bFrom Table E12. 

2. Description of the Potential Impacts 

of the Final Rule on Small Entities 

a. Effect on manufacturers. In order to 

estimate how much of the label design 

and inventory costs would be incurred 

by small domestic cigarette 

manufacturers, FDA subtracts the 

proportion of those costs estimated to be 

incurred by large domestic 

manufacturers and foreign 

manufacturers. Scanner data indicate 

that, approximately 55 percent of UPCs 

can be readily identified as belonging to 

a brand marketed by one of the 4 largest 

cigarette firms by volume (Ref. 105; 

Refs. 84–89). Because the costs of 

labeling changes are roughly 

proportional to the number of UPCs, 

FDA then attributes 55 percent of the 

total label design and inventory costs to 

the 4 firms employing at least 500 

people. FDA attributes an additional 3 

percent of the labeling change costs to 

foreign manufacturers.15 These 

adjustments leave 42 percent of labeling 

change costs, or $71 to $188 million, to 

be incurred by the 20 small 

manufacturers. Assuming costs are 

equal among these firms implies a perfirm cost of $3.5 to $9.4 million. Table 

E28 compares this estimated 

compliance cost to average annual 

receipts in order to gauge the potential 

impact of labeling change requirements 

on small cigarette manufacturing firms. 

Because the number of UPCs is probably 

larger for larger firms, costs are likely 

greater for larger firms than for smaller 

firms; if so this method overstates the 

impact on the smallest firms and 

understates the impact on the largest 

firms (within the category of firms 

employing fewer than 500 people). 

TABLE E28—POTENTIAL IMPACT OF LABELING CHANGE COMPLIANCE COSTS ON THE 20 SMALL CIGARETTE

MANUFACTURERS

Size by number of employees Number of 

firms 

Average 

annual 

receipts 

($1,000) 

Average labeling 

compliance costs ($1,000) 

Average labeling 

compliance costs as a 

percent of average annual 

receipts 

Low High 

Low High 

Less than 20 .................................................................... 9 11,195 3,546 9,386 32 84 

20 to 99 ............................................................................ 7 21,265 3,546 9,386 17 44 

100 to 499 ........................................................................ 4 147,896 3,546 9,386 2 6 

Source: Ref. 77. 

SBA size standard: 1,000 employees. 

b. Effect on retailers. As shown in 

Table E29, retail trade businesses 

account for almost all sales of tobacco 

products (Ref. 78; Ref. 79). About 90 

percent of tobacco product line sales 

occur at gasoline stations, food and 

beverage stores, general merchandise 

stores, or tobacco stores. Convenience 

stores (with gasoline stations and standalone convenience stores) account for 

about half of all tobacco product line 

sales. 

TABLE E29—SALES OF TOBACCO PRODUCT LINE BY KIND OF BUSINESS AND INDUSTRY SECTOR a

Kind of business and industry sector 

Sales of tobacco product 

line by kind of business 

Sales of tobacco product 

line by industry sector 

($ bil) (%) ($ bil) (%) 

Retail Trade 

NAICS 447—Gasoline Stations ....................................................................................... .................... .................... 22.2 43.3 

Convenience Stores with Gas .................................................................................. 21.2 41.3 .................... ....................


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TABLE E29—SALES OF TOBACCO PRODUCT LINE BY KIND OF BUSINESS AND INDUSTRY SECTOR a—Continued 

Kind of business and industry sector 

Sales of tobacco product 

line by kind of business 

Sales of tobacco product 

line by industry sector 

($ bil) (%) ($ bil) (%) 

Gasoline Stations ..................................................................................................... 1.0 2.0 .................... ....................

NAICS 445—Food and Beverage Stores ........................................................................ .................... .................... 13.4 26.2 

Supermarket & Grocery ............................................................................................ 7.7 15.0 .................... ....................

Convenience Stores ................................................................................................. 4.5 8.8 .................... ....................

Liquor Stores ............................................................................................................ 1.2 2.4 .................... ....................

NAICS 452—General Merchandise ................................................................................. .................... .................... 7.1 13.9 

General Merchandise ............................................................................................... 7.1 13.9 .................... ....................

NAICS 453—Miscellaneous Store Retailers ................................................................... .................... .................... 5.8 11.3 

Tobacco Stores ........................................................................................................ 5.7 11.1 .................... ....................

Miscellaneous store retailers .................................................................................... 0.1 0.3 .................... ....................

NAICS 446—Health and Personal Care Stores .............................................................. .................... .................... 1.5 3.0 

Drug Stores .............................................................................................................. 1.5 3.0 .................... ....................

NAICS 454—Nonstore Retailers ..................................................................................... .................... .................... 0.7 1.3 

Nonstore Retailers .................................................................................................... 0.5 1.0 .................... ....................

Vending machine operators ..................................................................................... 0.2 0.4 .................... ....................

Other Subsectors b ........................................................................................................... .................... .................... 0.1 0.2 

Other Kinds of Business ........................................................................................... 0.1 0.2 .................... ....................

Accommodation & Food Services 

NAICS 72 ......................................................................................................................... .................... .................... 0.4 0.8 

Other establishments ................................................................................................ 0.3 0.5 .................... ....................

Drinking places ......................................................................................................... 0.1 0.3 .................... ....................

Total ................................................................................................................... .................... .................... 51.2 100 

a Includes establishments with payroll with tobacco product line sales. 

b Includes establishments in NAICS 441320, 443112, 444130, 444220, 448110, 448320, 451110, 451211, 451212, and 451220. 

To illustrate the effects of the 

proposed rule on a typical small retail 

store, we look at one-time costs for a 

convenience store and a convenience 

store with gasoline. We select these 

businesses because, as illustrated in 

Table E29, sales of tobacco products in 

these stores account for about 50 

percent of all tobacco sales. In addition, 

tobacco products are an important part 

of overall revenue for these stores, 

composing over 12 percent of total sales 

(as shown in Table E30). 

TABLE E30—THE IMPORTANCE OF TOBACCO SALES BY KIND OF BUSINESS: RANKED BY THE PERCENTAGE OF TOTAL

SALES FROM TOBACCO PRODUCT LINE

Kind of business 

Sales from 

tobacco 

product 

line a ($ bil) 

Total sales 

from all 

product 

lines ($ bil) b

Percentage 

of total 

sales from 

tobacco 

product line 

Tobacco Stores ........................................................................................................................................ 5.7 6.5 86.9 

Convenience Stores ................................................................................................................................ 4.5 18.1 25.0 

Nonstore Retailers ................................................................................................................................... 0.5 2.4 20.3 

Convenience Stores with Gas ................................................................................................................. 21.2 173.4 12.2 

Vending Machine Operators .................................................................................................................... 0.2 1.7 11.2 

Miscellaneous store retailers ................................................................................................................... 0.1 1.2 11.2 

Liquor Stores ........................................................................................................................................... 1.2 12.8 9.7 

Other Kinds of Business .......................................................................................................................... 0.1 1.4 6.5 

Drinking places ........................................................................................................................................ 0.1 3.9 3.5 

Gasoline Stations ..................................................................................................................................... 1.0 29.4 3.5 

General Merchandise .............................................................................................................................. 7.1 246.1 2.9 

Supermarket & Grocery ........................................................................................................................... 7.7 383.5 2.0 

Drug Stores .............................................................................................................................................. 1.5 80.0 1.9 

Other Accommodation & Foodservice ..................................................................................................... 0.3 33.3 0.8 

Total .................................................................................................................................................. 51.2 993.9 5.2 

aTobacco sales from Table E29. 

b Includes total sales for firms with tobacco product line sales. Refs. 78, 79. 

For both types of convenience stores, 

Table E31 shows that for the smallest 

firms with less than $250,000 in annual 

sales, the one-time costs of the proposed 

rule would equal less than 2 percent of 

annual average sales of tobacco 

products. Furthermore, one-time costs 

total less than 0.1 percent of annual 

average sales of tobacco products for 

stores with $1 million or more in 

average annual sales. Although the 

impact on other small retail and service 

entities is uncertain, this example 

suggests that the proposed rule would 

be unlikely to create a significant direct 


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Federal Register / Vol. 75, No. 218 / Friday, November 12, 2010 / Proposed Rules 69559 

burden on small retail stores or service 

establishments. 

TABLE E31—ONE-TIME COSTS AS A PERCENTAGE OF AVERAGE SALES OF TOBACCO PRODUCTS FOR CONVENIENCE

STORES AND CONVENIENCE STORES WITH GASOLINE

Sales size of firm 

Number of 

establishments 

Sales 

($ mil) 

Sales of tobacco products 

Average 

($ mil) 

One-time 

costs as 

percentage 

of average 

Convenience Store—NAICS 445120 a: 

Less than $250,000 .................................................................................................. 4,231 653 0.0 0.5 

$250,000 to $499,999 .............................................................................................. 5,296 1,920 0.1 0.2 

$500,000 to $999,999 .............................................................................................. 5,150 3,646 0.2 0.1 

$1,000,000 to $2,499,999 ........................................................................................ 3,586 4,915 0.3 0.1 

$2,500,000 to $4,999,999 ........................................................................................ 659 1,601 0.6 0.0 

$5,000,000 to $9,999,999 ................................................................................................ 324 712 0.5 0.0 

$10,000,000 to $24,999,999 ............................................................................................ 215 440 0.5 0.0 

Convenience Stores with Gasoline—NAICS 447110 b: 

Less than $250,000 .................................................................................................. 2,246 343 0.0 1.0 

$250,000 to $499,999 .............................................................................................. 3,801 1,425 0.0 0.4 

$500,000 to $999,999 .............................................................................................. 7,667 5,624 0.1 0.2 

$1,000,000 to $2,499,999 ........................................................................................ 14,309 22,303 0.2 0.1 

$2,500,000 to $4,999,999 ........................................................................................ 7,977 22,786 0.3 0.1 

Source: Ref. 108. 

aTobacco product line sales account for 25.0 percent of sales for all firms in NAICS 445120 (see Table E30); One-time costs equal $198.16 

(see Table E13). bTobacco product line sales account for 12.2 percent of sales for all firms in NAICS 447110 (see Table E30); One-time costs equal $193.42 

(see Table E13). 

3. Alternatives To Minimize the Burden 

on Small Entities 

a. Increase the compliance period to 

24 months for small manufacturers or 

all manufacturers. Allowing all 

manufacturers, or only small 

manufacturers, 24 months to comply 

with the labeling changes would reduce 

overtime and rush charges. Under a 24- 

month compliance period, labeling 

change costs would fall on average by 

$0.32 to $0.85 million per small firm. 

Table E32 compares the reduced 

estimated compliance cost to average 

annual receipts in order to gauge the 

potential impact of this regulatory 

alternative on cigarette manufacturing 

firms employing fewer than 500 people. 

As a comparison with Table E28 shows, 

this option would provide only modest 

relief. It would also delay the public 

health benefits of the proposed rule and 

be inconsistent with the statutory 

requirement. 

TABLE E32—POTENTIAL IMPACT OF LABELING CHANGE COMPLIANCE COSTS ON THE 20 SMALL CIGARETTE

MANUFACTURERS WITH A 24-MONTH COMPLIANCE PERIOD

Size by number of employees Number of 

firms 

Average 

annual 

receipts 

($1,000) 

Average labeling 

compliance costs 

($,1000) 

Average labeling 

compliance costs 

as a % of average 

annual receipts 

Low High Low High 

Less than 20 .................................................................... 9 11,195 3,224 8,533 29 76 

20 to 99 ............................................................................ 7 21,265 3,224 8,533 15 40 

100 to 499 ........................................................................ 4 147,896 3,224 8,533 2 6 

Source: Ref. 77 

SBA size standard: 1,000 employees 

b. Exempt small manufacturers from 

the labeling change requirements. 

Exempting small manufacturers from 

the labeling change requirements would 

eliminate their incremental labeling 

costs (an average reduction of $3.5 to 

$9.4 million), thus providing maximum 

relief. The combined market share of the 

4 largest manufacturers was 89.7 

percent in 2008 (Ref. 105). The 

immediate impact would therefore be to 

allow 10.3 percent of cigarettes to be 

marketed without graphic warning 

labels when the rule went into effect. 

This proportion would grow over time, 

however, as some consumers would be 

expected to switch to brands marketed 

without graphic warnings. This 

approach would be inconsistent with 

both the statutory mandate and the 

public health objectives of this rule. 

c. Exempt small cigarette retailers 

from the point-of-sale advertising 

requirements. Exempting small cigarette 

retailers from the point-of-sale 

advertising requirements would 

eliminate their need to remove 

noncompliant advertising, reducing 

their direct costs to zero. However, 

Table E27 shows that the overwhelming 

majority of retail establishments selling 

cigarettes are small. Although the few 

establishments operated by large firms 

might be expected to have higher 

volume, a significant proportion of 

consumers would continue to be 

exposed to advertising lacking the new 

graphic warnings. This situation would 

be inconsistent with the public health 


emcdonald on DSK2BSOYB1PROD with PROPOSALS2
69560 Federal Register / Vol. 75, No. 218 / Friday, November 12, 2010 / Proposed Rules 

objective of the proposed rule as well as 

FDA’s statutory mandate. 

IX. Comments 

Interested persons may submit to the 

Division of Dockets Management (see 

ADDRESSES) either electronic or written 

comments regarding this document. As 

noted above, if you have comments on 

specific provisions of the proposed 

regulation, we request that you identify 

these provisions in your comments. In 

addition, if you have concerns that 

would be addressed by alternative text 

for the regulation, we request that you 

provide this alternative text in your 

comments. It is only necessary to send 

one set of comments. It is no longer 

necessary to send two copies of mailed 

comments. Identify comments with the 

docket number found in brackets in the 

heading of this document. Received 

comments may be seen in the Division 

of Dockets Management between 9 a.m. 

and 4 p.m., Monday through Friday. 

X. References 

The following references have been 

placed on display in the Division of 

Dockets Management (see ADDRESSES) 

and may be seen by interested persons 

between 9 a.m. and 4 p.m. Monday 

through Friday. (FDA has verified Web 

site addresses, but FDA is not 

responsible for any subsequent changes 

to the Web sites after this document 

publishes in the Federal Register.) 

1. Centers for Disease Control and 

Prevention, ‘‘Smoking-Attributable Mortality, 

Years of Potential Life Lost, and Productivity 

Losses—United States, 2000–2004,’’ 

Morbidity and Mortality Weekly Report, 

57(45); 1226–1228, Nov. 14, 2008, available 

at http://www.cdc.gov/mmwr/preview/ 

mmwrhtml/mm5745a3.htm. 

2. U.S. Department of Health and Human 

Services, ‘‘The Health Consequences of 

Smoking,’’ A Report of the Surgeon General; 

2004, available at http:// 

www.surgeongeneral.gov/library/ 

smokingconsequences/index.html. 

3. U.S. Department of Health and Human 

Services, ‘‘Youth & Tobacco; Preventing 

Tobacco Use Among Young People,’’ A 

Report of the Surgeon General; 1994, 

available at http://www.surgeongeneral.gov/ 

library/reports/. 

4. H.R. 1108, Family Smoking Prevention 

And Tobacco Control Act: Hearing Before the 

House Subcommittee on Health of the 

Committee on Energy and Commerce, 110th 

Cong. 42 (2007) (testimony of Richard 

Bonnie). 

5. Institute of Medicine of the National 

Academies, ‘‘Ending the Tobacco Problem: A 

Blueprint for the Nation,’’ 2007, available at 

http://www.iom.edu/Reports/2007/Endingthe-Tobacco-Problem-A–Blueprint-for-theNation.aspx. 

6. Centers for Disease Control and 

Prevention, ‘‘Vital Signs: Current Cigarette 

Smoking Among Adults Aged > 18 Years— 

United States, 2009,’’ Morbidity and Mortality 

Weekly Report, 59(35); 1135–1140, Sept. 10, 

2010, available at http://www.cdc.gov/mmwr/ 

preview/mmwrhtml/mm5935a3.htm. 

7. Centers for Disease Control and 

Prevention, ‘‘Surveillance for Cancers 

Associated with Tobacco Use—United States, 

1999–2004,’’ Morbidity and Mortality Weekly 

Report, 57(SS08); 1–33, Sept. 5, 2008, 

available at http://www.cdc.gov/mmwr/ 

preview/mmwrhtml/ss5708a1.htm. 

8. Substance Abuse and Mental Health 

Services Administration, ‘‘Results from the 

2008 National Survey on Drug Use and 

Health: National Findings,’’ Rockville, MD: 

2009, available at http:// 

www.oas.samhsa.gov/nsduh/2k8nsduh/ 

2k8Results.pdf. 

9. Centers for Disease Control and 

Prevention, ‘‘Tobacco Use Among Middle and 

High School Students—United States, 2000– 

2009,’’ Morbidity and Mortality Weekly 

Report, 59(33); 1063–1068, Aug. 27, 2010, 

available at http://www.cdc.gov/mmwr/ 

preview/mmwrhtml/mm5933a2.htm. 

10. Centers for Disease Control and 

Prevention, ‘‘Trends in Smoking Initiation 

Among Adolescents and Young Adults— 

United States, 1980–1989,’’ Morbidity and 

Mortality Weekly Report, 44(28); 521–525, 

July 21, 1995, available at http:// 

www.cdc.gov/mmwr/preview/mmwrhtml/ 

00038190.htm. 

11. Centers for Disease Control and 

Prevention, ‘‘Youth Risk Behavior 

Surveillance—United States, 2009,’’ 

Morbidity and Mortality Weekly Report 2010, 

59 (No. SS–5); June 4, 2010, available at 

http://www.cdc.gov/mmwr/pdf/ss/ 

ss5905.pdf. 

12. Johnston, L.D., O’Malley P.M., 

Bachman J.G., and Schulenberg, J.E., 

‘‘Smoking continues gradual decline among 

U.S. teens, smokeless tobacco threatens a 

comeback.’’ University of Michigan News 

Service: Ann Arbor, MI, Dec. 14, 2009, 

available at http:// 

www.monitoringthefuture.org/data/ 

09data.html#2009data-cigs. 

13. Centers for Disease Control and 

Prevention, ‘‘Cigarette Use Among High 

School Students—United States, 1991–2009,’’ 

Morbidity and Mortality Weekly Report, 

59(26); 797–801, July 9, 2010, available at 

http://www.cdc.gov/mmwr/preview/ 

mmwrhtml/mm5926a1.htm. 

14. Taioli, E., and Wynder, E.L., ‘‘Effect of 

the Age at Which Smoking Begins on 

Frequency of Smoking in Adulthood,’’ The 

New England Journal of Medicine, 325(13); 

968–969, 1991. 

15. Chen, J. and Millar, W, ‘‘Age of smoking 

initiation: implications for quitting,’’ Health 

Reports (Statistics Canada, Catalogue 82– 

003–XPB), 9(4); 39–46, 1998. 

16. Breslau, N., and Peterson, E., ‘‘Smoking 

Cessation in Young Adults: Age at Initiation 

of Cigarette Smoking and Other Suspected 

Influences,’’ American Journal of Public 

Health, 86(2); 214–20, 1996. 

17. Benowitz, N., ‘‘Nicotine Addiction,’’ 

The New England Journal of Medicine, 

362(24); 2295–303, 2010. 

18. Centers for Disease Control and 

Prevention, ‘‘Cigarette Smoking-Attributable 

Morbidity—United States, 2000,’’ Morbidity 

and Mortality Weekly Report, 52(35); 842– 

844, Sept. 5, 2003, available at http:// 

www.cdc.gov/mmwr/preview/mmwrhtml/ 

mm5235a4.htm. 

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List of Subjects in 21 CFR Part 1141 

Advertising, Incorporation by 

reference, Labeling, Packaging and 

containers, Tobacco, and Smoking. 

Therefore, under the Federal Cigarette 

Labeling and Advertising Act, the 

Federal Food, Drug, and Cosmetic Act, 

and under authority delegated to the 

Commissioner of Food and Drugs, it is 

proposed that chapter I of title 21 of the 

Code of Federal Regulations be 

amended by adding part 1141 to 

subchapter K to read as follows: 

PART 1141—CIGARETTE PACKAGE 

AND ADVERTISING WARNINGS 

Subpart A—General Provisions 

Sec. 

1141.1 Scope. 

1141.3 Definitions. 

Subpart B—Cigarette Package and 

Advertising Warnings 

1141.10 Required warnings. 

1141.12 Incorporation by reference of 

required warnings. 

1141.14 Misbranding of cigarettes. 

Subpart C—Additional Disclosure 

Requirements for Cigarette Packages and 

Advertising 

1141.16 Disclosures regarding cessation. 

Authority: Secs. 201 and 202, Pub. L. 111– 

31, 123 Stat. 1776; 15 U.S.C. 1333; 21 U.S.C. 

371, 387c, 387f. 

Subpart A—General Provisions 

§ 1141.1 Scope. 

(a) This part sets forth the 

requirements for the display of health 

warnings on cigarette packages and in 

advertisements for cigarettes. FDA may 

require additional statements to be 

displayed on packages and in 

advertisements under the Federal Food, 

Drug, and Cosmetic Act or other 

authorities. 

(b) The requirements of this part do 

not apply to manufacturers or 

distributors of cigarettes that do not 

manufacture, package, or import 

cigarettes for sale or distribution within 

the United States. 

(c) A cigarette retailer shall not be 

considered in violation of this part as it 

applies to the display of health 

warnings on a cigarette package if the 

package: 

(1) Contains a health warning; 

(2) Is supplied to the retailer by a 

license- or permit-holding tobacco 

product manufacturer, importer, or 

distributor; and 


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Federal Register / Vol. 75, No. 218 / Friday, November 12, 2010 / Proposed Rules 69563 

(3) Is not altered by the retailer in a 

way that is material to the requirements 

of section 4(a) of the Federal Cigarette 

Labeling and Advertising Act (15 U.S.C. 

1333(a)) or this part, including by 

obscuring the warning, by reducing its 

size, by severing it in whole or in part, 

or by otherwise changing it in a material 

way. 

(d) A cigarette retailer shall not be 

considered in violation of this part, as 

it applies to the display of health 

warnings in an advertisement for 

cigarettes if the advertisement is not 

created by or on behalf of the retailer 

and the retailer is not otherwise 

responsible for the inclusion of the 

required warnings. This paragraph shall 

not relieve a retailer of liability if the 

retailer displays, in a location open to 

the public, an advertisement that does 

not contain a health warning or that 

contains a warning that has been altered 

by the retailer in a way that is material 

to the requirements of section 4(b) of the 

Federal Cigarette Labeling and 

Advertising Act (15 U.S.C. 1333(b)), this 

part, or section 4(c) of the Federal 

Cigarette Labeling and Advertising Act 

(15 U.S.C. 1333(c)), including by 

obscuring the warning, by reducing its 

size, by severing it in whole or in part, 

or by otherwise changing it in a material 

way. 

§ 1141.3 Definitions. 

For the purposes of this part, 

Cigarette means: 

(1) Any roll of tobacco wrapped in 

paper or in any substance not 

containing tobacco; and 

(2) Any roll of tobacco wrapped in 

any substance containing tobacco 

which, because of its appearance, the 

type of tobacco used in the filler, or its 

packaging and labeling, is likely to be 

offered to, or purchased by, consumers 

as a cigarette described in paragraph (1) 

of this definition. 

Commerce means: 

(1) Commerce between any State, the 

District of Columbia, the 

Commonwealth of Puerto Rico, Guam, 

the Virgin Islands, American Samoa, 

Wake Island, Midway Islands, Kingman 

Reef, or Johnston Island and any place 

outside thereof; 

(2) Commerce between points in any 

State, the District of Columbia, the 

Commonwealth of Puerto Rico, Guam, 

the Virgin Islands, American Samoa, 

Wake Island, Midway Islands, Kingman 

Reef, or Johnston Island, but through 

any place outside thereof; or 

(3) Commerce wholly within the 

District of Columbia, Guam, the Virgin 

Islands, American Samoa, Wake Island, 

Midway Island, Kingman Reef, or 

Johnston Island. 

Distributor means any person who 

furthers the distribution of cigarettes at 

any point from the original place of 

manufacture to the person who sells or 

distributes the product to individuals 

for personal consumption. Common 

carriers are not considered distributors 

for the purposes of this part. 

Front panel and rear panel mean the 

two largest sides or surfaces of the 

package. 

Importer means any person who 

introduces into commerce any cigarette 

that: 

(1) Was not manufactured inside the 

United States; and 

(2) Is intended for sale or distribution 

to consumers in the United States. 

Manufacturer means any person, 

including any repacker or relabeler, who 

manufactures, fabricates, assembles, 

processes, or labels a finished cigarette 

product. 

Package means a pack, box, carton, or 

container of any kind in which 

cigarettes are offered for sale, sold, or 

otherwise distributed to consumers. 

Person means an individual, 

partnership, corporation, or any other 

business or legal entity. 

Required warning means the 

combination of one of the textual 

warning statements and its 

accompanying color graphic, which are 

set forth in ‘‘Cigarette Required 

Warnings—English and Spanish’’ and 

‘‘Cigarette Required Warnings—Other 

Foreign Languages,’’ which are 

incorporated by reference at § 1141.12. 

Retailer means any person who sells 

cigarettes to individuals for personal 

consumption, or who operates a facility 

where vending machines or self-service 

displays of cigarettes are permitted. 

United States, when used in a 

geographical sense, includes the several 

States, the District of Columbia, the 

Commonwealth of Puerto Rico, Guam, 

the Virgin Islands, American Samoa, 

Wake Island, Midway Islands, Kingman 

Reef, and Johnston Island. The term 

‘‘State’’ includes any political division of 

any State. 

Subpart B—Cigarette Package and 

Advertising Warnings 

§ 1141.10 Required warnings. 

(a) Packages—(1) It shall be unlawful 

for any person to manufacture, package, 

sell, offer to sell, distribute, or import 

for sale or distribution within the 

United States any cigarettes the package 

of which fails to bear, in accordance 

with section 4 of the Federal Cigarette 

Labeling and Advertising Act (15 U.S.C. 

1333) and this part, one of the required 

warnings on both the front and the rear 

panel. 

(2) The required warning shall be 

obtained and accurately reproduced 

from the electronic images contained in 

‘‘Cigarette Required Warnings—English 

and Spanish,’’ which is incorporated by 

reference at § 1141.12, except that it 

must be adapted as necessary to meet 

the requirements of section 4 of the 

Federal Cigarette Labeling and 

Advertising Act (15 U.S.C. 1333) and 

this part. 

(3) The required warning shall appear 

directly on the package and shall be 

clearly visible underneath the 

cellophane or other clear wrapping. 

(4) The required warning shall be 

located in the upper portion of the front 

and rear panels of the package and shall 

comprise at least the top 50 percent of 

these panels; Provided, however, that on 

cigarette cartons, the required warning 

shall be located on the left side of the 

front and rear panels of the carton and 

shall comprise at least the left 50 

percent of these panels. 

(5) The required warning shall be 

positioned such that the text of the 

required warning and the other 

information on that panel of the package 

have the same orientation. 

(b) Advertisements—(1) It shall be 

unlawful for any manufacturer, 

importer, distributor, or retailer of 

cigarettes to advertise or cause to be 

advertised within the United States any 

cigarette unless its advertising bears, in 

accordance with section 4 of the Federal 

Cigarette Labeling and Advertising Act 

(15 U.S.C. 1333) and this part, one of the 

required warnings. 

(2) The text in each required warning 

shall be in the English language, except 

that: 

(i) In the case of an advertisement that 

appears in a non-English publication, 

the text in the required warning shall 

appear in the predominant language of 

the publication whether or not the 

advertisement is in English; and 

(ii) In the case of an advertisement 

that appears in an English language 

publication but that is not in English, 

the text in the required warning shall 

appear in the same language as that 

principally used in the advertisement. 

(3) For English-language and Spanishlanguage warnings, each required 

warning shall be obtained and 

accurately reproduced from the 

electronic images contained in 

‘‘Cigarette Required Warnings—English 

and Spanish,’’ which is incorporated by 

reference at § 1141.12, except that it 

must be adapted as necessary to meet 

the requirements of section 4 of the 

Federal Cigarette Labeling and 

Advertising Act (15 U.S.C. 1333), 

including area and other formatting 

requirements, and this part. 


emcdonald on DSK2BSOYB1PROD with PROPOSALS2
69564 Federal Register / Vol. 75, No. 218 / Friday, November 12, 2010 / Proposed Rules 

(4) For foreign-language warnings, 

except for Spanish-language warnings, 

each required warning shall be the color 

graphic obtained and accurately 

reproduced from the electronic images 

contained in ‘‘Cigarette Required 

Warnings—Other Foreign Language 

Advertisements,’’ which is incorporated 

by reference at § 1141.12, and into 

which a true and accurate translation of 

the textual warning is inserted in 

accordance with ‘‘Cigarette Required 

Warnings—Other Foreign Language 

Advertisements,’’ except that the 

required warning must be adapted as 

necessary to meet the requirements of 

section 4 of the Federal Cigarette 

Labeling and Advertising Act (15 U.S.C. 

1333), including area and other 

formatting requirements, and this part. 

(5) The required warning shall occupy 

at least 20 percent of the area of each 

advertisement, and shall be placed in 

accordance with the requirements in the 

Federal Cigarette Labeling and 

Advertising Act. 

(c) Irremovable or permanent 

warnings. The required warnings shall 

be indelibly printed on or permanently 

affixed to the package or advertisement. 

Such warnings, for example, must not 

be printed or placed on a label affixed 

to a clear outer wrapper that is likely to 

be removed to access the product within 

the package. 

§ 1141.12 Incorporation by reference of 

required warnings. 

Certain material entitled: ‘‘Cigarette 

Required Warnings—English and 

Spanish,’’ (edition 1.0, June 2011, Food 

and Drug Administration), appearing in 

§§ 1141.10(a)(2), (b)(3), and 1141.16(a); 

and ‘‘Cigarette Required Warnings— 

Other Foreign Language 

Advertisements,’’ (edition 1.0, June 

2011, Food and Drug Administration), 

appearing in §§ 1141.10(b)(4) and 

1141.16(a) are incorporated by reference 

into this part with the approval of the 

Director of the Federal Register in 

accordance with 5 U.S.C. 552(a) and 1 

CFR part 51. You may obtain a copy 

from the Food and Drug Administration, 

Center for Tobacco Products, Office of 

Compliance, 9200 Corporate Blvd., 

Rockville, MD 20850, 1–877–CTP–1373, 

and from the Web sites listed in 

paragraphs (a) and (b) of this section. 

Also, this material is available for 

inspection at the National Archives and 

Records Administration (NARA). For 

more information on the availability of 

the following material, call NARA at 

202–741–6030 or go to http://www.

archives.gov/Federal_register/codeof_

Federal_regulations/ibr_locations.html: 

(a) ‘‘Cigarette Required Warnings— 

English and Spanish,’’ available from 

FDA at http://www.fda.gov/Tobacco, 

referred to at §§ 1141.10(a)(2) and (b)(3) 

and § 1141.16. 

(b) ‘‘Cigarette Required Warnings— 

Other Foreign Language 

Advertisements,’’ available from FDA at 

http://www.fda.gov/Tobacco, referred to 

at §§ 1141.10(b)(4) and § 1141.16. 

§ 1141.14 Misbranding of cigarettes. 

(a) A cigarette shall be deemed to be 

misbranded under section 903(a)(1) of 

the Federal Food, Drug, and Cosmetic 

Act unless its labeling bears one of the 

required warnings in accordance with 

section 4 of the Federal Cigarette 

Labeling and Advertising Act (15 U.S.C. 

1333) and this part. A cigarette shall be 

deemed to be misbranded under section 

903(a)(7)(A) of the Federal Food, Drug, 

and Cosmetic Act unless its advertising 

bears one of the required warnings in 

accordance with section 4 of the Federal 

Cigarette Labeling and Advertising Act 

(15 U.S.C. 1333) and this part. 

(b) A cigarette advertisement or 

package will be deemed to include a 

brief statement of relevant warnings for 

the purposes of section 903(a)(8) of the 

Federal Food, Drug, and Cosmetic Act if 

it bears one of the required warnings in 

accordance with section 4 of the Federal 

Cigarette Labeling and Advertising Act 

(15 U.S.C. 1333) and this part. A 

cigarette distributed or offered for sale 

in any State shall be deemed to be 

misbranded under section 903(a)(8) of 

the Federal Food, Drug, and Cosmetic 

Act unless the manufacturer, packer, or 

distributor includes in all 

advertisements and packages issued or 

caused to be issued by the 

manufacturer, packer, or distributor 

with respect to the cigarette one of the 

required warnings in accordance with 

section 4 of the Federal Cigarette 

Labeling and Advertising Act (15 U.S.C. 

1333) and this part. 

Subpart C—Additional Disclosure 

Requirements for Cigarette Packages 

and Advertising 

§ 1141.16 Disclosures regarding 

cessation. 

(a) The required warning shall 

include a reference to a smoking 

cessation assistance resource in 

accordance with, and as specified in, 

‘‘Cigarette Required Warnings—English 

and Spanish’’ (incorporated by reference 

at § 1141.12) or ‘‘Cigarette Required 

Warnings—Other Foreign Language 

Advertisements’’ (incorporated by 

reference at § 1141.12), whichever is 

applicable. 

(b) The smoking cessation assistance 

resource required to be referenced by 

paragraph (a) of this section must: 

(1) Provide factual information about 

the harms to health associated with 

cigarette smoking and the health 

benefits of quitting smoking; 

(2) Provide factual information about 

what smokers can expect when trying to 

quit; 

(3) Provide practical advice (problem 

solving/skills training) about how to 

deal with common issues faced by users 

trying to quit; 

(4) Provide evidence-based advice 

about how to formulate a plan to quit 

smoking; 

(5) Provide evidence-based 

information about effective relapse 

prevention strategies; 

(6) Provide factual information on 

smoking cessation treatments, including 

FDA-approved cessation medications; 

(7) Provide information, advice, and 

support that is evidence-based, 

unbiased (including with respect to 

products, services, persons, and other 

entities), and relevant to tobacco 

cessation; 

(8) Other than as described in this 

section, not advertise or promote any 

particular product or service; 

(9) Not selectively present 

information about a subset of FDAapproved cessation products or product 

categories while failing to mention other 

FDA-approved cessation products or 

product categories or reference any drug 

or other medical product that FDA has 

not approved for tobacco cessation; and 

(10) Not encourage the use of any 

non-evidence-based smoking cessation 

practices. 

(c) If the smoking cessation assistance 

resource required to be referenced by 

paragraph (a) of this section is a Web 

site, it: 

(1) Must not contain a link to any Web 

site unless it meets all of the criteria 

described in paragraph (b) of this 

section; and 

(2) May include references to one or 

more toll-free telephone numbers only if 

they meet the criteria described in 

paragraphs (b) and (d) of this section. 

(d) If the smoking cessation assistance 

resource required to be referenced by 

paragraph (a) of this section is a toll-free 

telephone number, it must: 

(1) Ensure that staff providing 

smoking cessation information, advice, 

and support are trained specifically to 

help smokers quit by delivering 

unbiased and evidence-based 

information, advice, and support; and 

(2) Maintain appropriate controls to 

ensure the criteria described in 

paragraph (b) of this section are met. 


emcdonald on DSK2BSOYB1PROD with PROPOSALS2
Federal Register / Vol. 75, No. 218 / Friday, November 12, 2010 / Proposed Rules 69565 

Dated: November 8, 2010. 

Margaret A. Hamburg, 

Commissioner of Food and Drugs. 

Dated: November 8, 2010. 

Kathleen Sebelius, 

Secretary of Health and Human Services. 

[FR Doc. 2010–28538 Filed 11–10–10; 8:45 am] 

BILLING CODE 4160–01–P 


emcdonald on DSK2BSOYB1PROD with PROPOSALS2