FDA Takes Action Against Illegal Marketing of Tobacco Products
NACS urges members to complete We Card training as FDA steps up enforcement on tobacco retailers.

 WASHINGTON — The U.S. Food and Drug Administration (FDA) yesterday announced it issued 11 warning letters last week to online retailers for illegally marketing tobacco products with “misleading or unsubstantiated claims or descriptors” suggesting the products reduce the harm or risk of tobacco-related disease.

“There is no known safe tobacco product. It is illegal for tobacco companies or retailers, including Internet sellers, to make unsubstantiated claims or statements that imply tobacco products reduce health risks,” said Lawrence R. Deyton, M.S.P.H., M.D., director of the FDA’s Center for Tobacco Products. “FDA will pursue enforcement actions to protect the public health.”

The misleading descriptors violate the Federal Food, Drug and Cosmetic Act and include terms such as “light,” “low,” “mild,” “less toxic” and “safer.” Those words or “claims” are not permitted unless supported by scientific evidence and unless a company has received an order from the FDA allowing it.

NACS applauds the increased enforcement on tobacco retailers and urges members to complete We Card training. NACS also supports the FDA’s enforcement on mail order vendors as well as bricks-and-mortar stores, which is consistent with the provisions NACS fought for in legislation that requires equal enforcement on all tobacco retailers.

In addition to marketing violations, the FDA also cited the illegal sale of flavored cigarettes in its warning letters.

To view the entire FDA compliance document, click here.

Louisiana House Votes to Renew Cigarette Tax
Despite veto threat from governor, House backs a renewal of a 4-cent per pack state cigarette tax.

BATON ROUGE, LA — The Louisiana House has backed a renewal of a 4-cent per pack state cigarette tax, which is set to expire in 2012, the Associated Press reports.

The tax was enacted 11 years ago and generates $12 million annually for the state budget. Without the renewal, Louisiana’s cigarette tax would drop to 32 cents per pack. It faces a veto threat from Louisiana’s governor, Bobby Jindal, who has called it a tax increase.

Lawmakers scoffed at Jindal’s characterization. "There is a huge difference between renewing a tax and passing a tax increase. If my constituents can't see the difference between that, I don't know that I want them voting for me," said Representative Joe Lopinto.

The renewal was met with bipartisan support 70-30, giving it the minimum two-thirds vote if needed to override a veto. It heads next to the state Senate.

Consumer Survey Spotlights Growing Concerns Over Gas, Food Prices

Americans remain “deeply concerned” about the cost of filling up.

  CHICAGO – In its most recent consumer sentiment and behavior survey, Technomic found that 84 percent of consumers believe that grocery prices have risen in the past three months and 62 percent believe restaurant prices have risen.

During the same time period, 50 percent of consumers believe packaged food sizes have gotten smaller and 32 percent believe the same thing has happened with restaurant portions. The two main reasons why consumers think package and/or portion sizes have gotten smaller are the desires of food and restaurant companies to enhance profitability and to keep retail prices the same when costs rise; only 10 percent attribute the downsizing to improving the products' healthfulness.

Technomic also found that very few consumers noted any decline in the quality of packaged foods and/or restaurant meals.

The rapid rise in gasoline prices has increased consumer sensitivity to price hikes in grocery stores and restaurants, said Bob Goldin, Technomic executive vice president.

“Consumers are deeply concerned about the price of gas, which they expect to continue to rise. As a result, they are very likely to reduce their spending on groceries and restaurant meals and increase their reliance on coupons and deals,” he said in a press release.

Goldin also notes that consumers have become more aware of total value, of which package/portion size is a key component, and urges food and restaurant companies to be sensitive to the risks of downsizing.

Oil Drops, Pump Prices Follow More Slowly 

Retail gasoline prices lag wholesale costs on the going up and the coming down.

SAN FRANCISCO – It might frustrate consumers to see that gasoline prices have not dropped despite the fall in crude oil prices last week, but that’s to be expected, MarketWatch reports. Crude oil prices plummeted close to 15 percent last week, but pump prices remained high throughout the United States.

“Retail prices lag wholesale prices on the way up and the way down,” said Jeff Lenard, NACS spokesman.

Motorist might see a slight dip in prices starting this week. Monday’s average price for a gallon of regular gasoline reached $3.96, still higher than last week’s average of $3.952.

“Customers generally don’t see the first few days of wholesale price increases because they are absorbed, full or in part, by retailers trying to keep customers,” said Lenard. “On the way down, the opposite happens and retailers try to make up for what they lost on the increase.” Generally, price swings take seven to 10 days to be fully processed to the consumer.

The volatile nature of crude oil swings also factors into gasoline prices. “Volatility can be the friend of retailers, but it’s a friend that stumbles on your lawn with drunken breath sometimes,” said Tom Kloza, chief oil analyst with Oil Price Information Service.