FTC Wants Health Warning Labels on Cigars and Ad Ban

WASHINGTON—What’s good for regulating cigarettes is equally good for cigars, the Federal Trade Commission (FTC) argued in a new report to Congress. It recommended that Congress require health warning labels for cigars, ban all cigar advertising on radio and television, and enact measures to restrict the access of underage smokers to cigars.

Commission members approved the report in a 4 to 0 vote. The FTC has the authority to require warning labels on cigars, but it chose to forward its recommendations to Capitol Hill to give Congress an opportunity to act before it imposed any regulations.

In the report, the FTC noted that after a 20-year decline, cigar sales began rising again in 1993. The surge in sales coincided with an increase in cigar advertising and promotions, and was fueled by a significant increase in cigar smoking among young adult men. The dramatic upswing in US cigar consumption since 1993 and the increasing evidence of the health threats posed by cigars prompted the agency to make its recommendations.

Cigar Advertising Triples in one Year

From cigar tastings to paying Hollywood for showing cigar smokers favorably in films and on television, the Big Five of US cigar makers have significantly increased the advertising and promotion of their products in recent years, according to a survey by the Federal Trade Commision (FTC).

The five cigar companies included in the FTC data nearly tripled their advertising and promotional expenditures between 1996 and 1997, from $30.9 million to $41 million.

Promotional costs accounted for about 40% of the total in both years and magazine advertising for approximately 21% in 1996 and 24% in 1997. The greatest percentage increase, 254%, was for newspaper advertising, which went from $189,000 in 1996 to $671,000 in 1997.

“Expenditures for public entertainment events, such as cigar dinners and cigar tastings, rose 46%,” the FTC report said. “Expenditures for celebrity endorsements and appearances, and payments for product placements in movies and television, more than doubled between 1996 and 1997, from approximately $143,500 to $339,000.”

The companies’ online advertising rose from $78,000 in 1996 to $218,000 in 1997. But, the FTC report said, “it is likely that the cigar industry’s presence on the Internet is substantially greater than what is reflected in their actual advertising expenditures.” This is because the cigar makers benefit indirectly from such things as online editions of Cigar Aficionado and Smoke magazines, retailers who sell cigars via the Internet, and chatrooms devoted to cigars.

The five companies that the FTC ordered to provide data were Consolidated Cigar Corp.; Swisher International, Inc.; General Cigar, Co.; Havatampa Inc.; and John Middleton, Inc.

Data from the 1997 National Household Survey on Drug Abuse, conducted by the federal government’s Substance Abuse and Mental Health Services Administration, showed that 10.5% of men and 1.9% of women smoked cigars in the month prior to being surveyed.

“While there is no data on teen cigar use prior to 1996, several recently conducted national surveys . . . show that substantial numbers of adolescents are trying cigars,” the report stated.

The FTC cited Department of Agriculture statistics that showed a 57% increase in cigar sales in the United States, from 3.4 billion cigars in 1993 to more than 5 billion in 1998. Data obtained from the five largest cigar makers under an FTC order revealed that their total sales volume increased 15% from 1996 to 1997, from 3.8 billion to 4.4 billion cigars, and their wholesale revenues rose from $613 million to $876 million. The most significant sales growth has been in premium cigars, hand-rolled cigars that sell for more than $1 each, the report said.

The FTC relied heavily on a 1998 National Cancer Institute report, generally known as the “NCI Cigar Monograph,” to make its argument for the ill effects of cigar smoking. NCI researchers reported that “cigar smoke contains the same toxic carcinogenic constituents formed in cigarette smoke.” People who smoke one or more cigars daily have a risk of oral and esophageal cancer similar to cigarette smokers, and an increased risk (but lower than the risk of cigarette smokers) of lung and laryngeal cancer, coronary heart disease, and chronic obstructive pulmonary disease, the NCI report said.

All the studies evaluated by the NCI used people who smoked one or more cigars each day. The FTC acknowledged that available data indicate that most users only smoke cigars occasionally. “There currently is no direct evidence on the form of the dose-response relationship for occasional cigar smokers,” the report said.

Three Warning Labels

The FTC noted that several studies in the United States and Canada have shown that people are generally aware that cigars pose health risks but are uncertain about the specific risks. “Warnings highlighting the specific health risks of cigar smoking may further educate consumers or reinforce their existing beliefs,” the report said.

The FTC recommended three separate labels:

WARNING: Regular cigar smoking can cause cancers of the mouth and throat, even if you do not inhale.

WARNING: Inhaling cigar smoke can cause lung cancer. The more deeply you inhale, the greater your risk.

WARNING: Cigars are not a safe alternative to cigarettes.

The report urged that cigar manufacturers and marketers be required to rotate the warnings, as cigarette makers are now required to do. “Multiple warnings can provide a broad range of health risk information, while also increasing the likelihood that consumers pay attention to individual messages over an extended period of time,” the FTC said.

According to the Cigar Association of America, 96% of cigars made in the United States are sold in or from boxes that already carry a health warning label that is designed to comply with a California law. However, imported cigars, many of which are premium cigars, are less likely to have health warnings.

Banning Cigar Ads

The commission also recommended banning the advertising of cigars on radio and television, including cable channels. It noted that unlike cigarettes, smokeless tobacco, and cigarette-size cigars, regular cigars can be advertised over the electronic media. “This disparate treatment of cigars could have the effect of increasing cigar sales and consumption,” the report said.

Reducing Access to Teens

In its third recommendation, the FTC urged federal actions to reduce access of cigars to young people. “As cigarettes and smokeless tobacco become less readily accessible to underage smokers, it will be important to restrict youth access to cigars to prevent them from becoming the tobacco product of choice for minors,” the report said. The commission suggested Congress reduce youth access to cigars by enacting measures such as restricting the use of self-service cigar displays.

It also acknowledged that cigar manufacturers, because of their relatively small size, might be unable to compete with cigarette companies for shelf space. It urged that any legislation “provide flexibility for alternative cigar shelving arrangements” and exempt tobacco specialty stores, “provided they take reasonable steps to restrict unaccompanied access by minors.”