Altria Wants Tobacco Quota Buyout, FDA Regulation Linked

CHARLOTTE, N.C. -- The nation's largest tobacco company says proposed federal legislation calling for a buyout of tobacco quotas would more likely pass through Congress if it were combined with regulation of cigarettes by the Food and Drug Administration, reported the Associated Press.

Altria Group Inc.'s position comes as tobacco-state congressmen prepare to push a buyout that doesn't include FDA regulation. A group of House members from tobacco-growing states is drafting a bill that would reserve 5 cents from the existing 39-cent-per-pack excise tax on cigarettes to pay for a buyout over seven years.

A U.S. Senate bill allowing FDA regulation of the tobacco industry appeared to stall last fall.

But Steve Parrish, a senior vice president at Altria, the parent of Philip Morris USA, told the Winston-Salem Journal the two issues are "inextricably linked.

"For a buyout to have any chance of success, it needs to be done in a way that can actually pass the Congress. If you look at the issue of the buyout, it really has very little support outside the tobacco-growing regions of the United States."

Still, Philip Morris executives said despite their efforts to piece together a coalition to pass both a buyout and FDA regulation, it's a long shot.

"To be honest, I think it's going to be extraordinarily difficult this year. But that's not to say it can't happen," said John Scruggs, vice president for government affairs at Altria. "It's going to take leadership."