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Tobacco Industry Vet Freudenthal Joins Imperial Tobacco Group 

Kevin Freudenthal has been named president and CEO for Commonwealth - Altadis Inc. and region director for the Americas at Imperial Tobacco Group (ITG). He succeeds Graham Bolt, who retired from the company at the end of December.

Freudenthal will take overall responsibility for Commonwealth - Altadis from Eric Workman, senior vice president of marketing, at the end of the month.

Freudenthal has 26 years of industry experience and has made a career out of leadership and innovation in marketing tobacco products, the company said, working with large teams, crafting business strategy and improving profitability.

Before joining ITG, he was vice president for category management for Altria Group, and before that, spent two decades in executive positions at U.S. Smokeless Tobacco Co., where he began his career as a territory representative.

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• Imperial Tobacco Group Announces Commonwealth-Altadis Inc. 

Altadis U.S.A. Inc. and Commonwealth Brands Inc., both owned by Imperial Tobacco Group PLC, have come together to create a new sales and distribution company called Commonwealth-Altadis Inc. (CAI), offering consumers and customers a high quality range of brands and products.

“Commonwealth-Altadis Inc. brings the outstanding sales and marketing teams of Altadis and Commonwealth together to provide greater sales coverage, a larger portfolio of products and a more comprehensive service to our customers,” said Graham Bolt, regional director Americas, in a press release.

“The combination strengthens our competitive position and enables us to apply our total tobacco focus to our sales expansion strategy. Total tobacco means expertise across tobacco categories at a range of price points, providing unrivalled choice for consumers and customers. Our enhanced total tobacco portfolio includes great cigarette, cigar and fine cut tobacco brands and we’re very excited about driving the growth of our brands and products through a larger, integrated sales team,” he said.

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Commonwealth Brands bails on Goodlettsville HQ  

In a significant blow to Goodlettsville, tobacco company Commonwealth Brands will not be moving its corporate headquarters from Bowling Green, Ky., and more than 100 jobs to Middle Tennessee, the company said Friday.

The nation’s fourth largest tobacco manufacturer — with brands including Davidoff, Sonoma, Montclair and USA Gold — is instead integrating operations with its Florida-based sister company, Altadis USA.

Friday’s announcement was less than two months away from Commonwealth’s expected move into an office building bought by Boyle Investment Co. for $2.17 million. Nashville Business Journal reported in December that Boyle planned to spend an additional $2 million upgrading the facility for the tobacco company. At the time, Commonwealth CEO Jonathan Cox said Commonwealth would spend more than $1 million as part of its move into a 30,000-square-foot space.

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Commonwealth Brands, Inc. and Altadis USA to Integrate Operations  

Commonwealth Brands, Inc. has announced that it will be integrating its sales and marketing operations with its Florida-based sister company, Altadis USA. This will allow the companies to provide their customers with greater sales coverage and more comprehensive services. The combined portfolio will incorporate cigarettes, fine cut tobacco, mass market cigars, pipe, papers and tubes. The premium cigar division of Altadis USA will remain as a separate entity.

In order to better service the combined business, Altadis USA's current offices in Fort Lauderdale will become the corporate center for the newly integrated company. As a result, the proposed Commonwealth Brands Corporate Office relocation to Nashville, TN will not take place.

The integration, between the two Company's sales and marketing functions, is expected to be completed within six months and the transition of all other departments to Fort Lauderdale within 12 months.

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• 'One + One = Three' 

Altadis USA announced yesterday that it is integrating sales and marketing units with those of Commonwealth Brands to form one unified team. "It combines two of Imperial Tobacco's assets into what we hope will be a better, combined company. One plus one, hopefully, equals three." Eric Workman, senior vice president of marketing for Altadis, told CSP Daily News.

As reported yesterday in a Morgan Keegan/CSP Daily News Flash, the goal of the integration, which kicked off this week, is to provide greater sales coverage and more comprehensive service to customers--with both cigarettes and cigars.

On the cigar side, Workman said, the company's sales force of about 200 people was smaller compared with competitor sales forces. The integration brings that number to 800, now making it one of the larger forces.

For cigarettes, the company is hoping to capitalize on the cigar side's "long-established relationships from brands with solid market shares," Workman said. "So we hope to be able to use those relationships and help the cigarette side along."

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Big drop in kids' ear infections, smoking decline may be a reason: researchers 

Ear infections, a scourge that has left countless tots screaming through the night, have fallen dramatically in number, and some researchers suggest a decline in smoking by parents might be part of the reason.

U.S. health officials report nearly a 30 per cent drop over 15 years in young children's doctor visits for ear infections. That's half a million fewer trips to the doctor on average.

Why the numbers are declining is a bit of a mystery, but Harvard researchers think it's partly because fewer people smoke, meaning less irritation of children's airways. Many doctors credit growing use of a vaccine against bacteria that cause ear infections. And some think increased breastfeeding is protecting more children. . . .

A big reason, Rosenfeld said, was a steady rise in dual-career families. More families put their kids in day care, and day care is a breeding ground for the germs that lead to ear infections.

But the study by Harvard University suggests another contributor: cigarette smoke.

Most ear infections occur after a cold. In children, the ear is more directly connected to the back of the nose, so infections in a child's nose and throat can easily trigger ear inflammation. Such swelling is a fertile setting for the bacteria that cause ear infections.

Cigarette smoke, inhaled through a child's nose, can trigger the same kind of irritation and swelling, said Dr. Gordon Hughes of the National Institute on Deafness and Other Communication Disorders. "We're sort of guessing here," said Dr. Richard Rosenfeld, a New York-based ear, nose and throat specialist who speaks about the issue for the American Academy of Pediatrics.

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Little Tobacco to take root in Goodlettsville  

Goodlettsville's corporate ranks and commercial real estate market will get a boost next spring from Commonwealth Brands Inc., a tobacco company moving its headquarters here from Bowling Green, Ky., along with 80 or 90 jobs.

The company, which sells USA Gold cigarettes among other brands, has a 4 percent market share of the cigarette industry. An estimated 83 employees have indicated they'll make the move with Commonwealth from Kentucky, and the firm could add a few more jobs once here.

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Tobacco company moving to Goodlettsville  

Goodlettsville's corporate ranks and commercial real estate market will get a boost this spring from Commonwealth Brands, Inc., a tobacco company moving its headquarters here from Bowling Green, Ky., along with 80 or 90 jobs.

The company, which sells USA Gold cigarettes among other brands, has a 4 percent market share of the cigarette industry.

An estimated 83 employees have indicated they'll make the move with Commonwealth from Kentucky, and the firm could add a few more jobs once here.

Commonwealth will move into a building owned by Boyle Investment Company at 112 Long Hollow Pike.

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• Nation's Fourth Largest Tobacco Manufacturer to Move to Middle Tennessee  

Commonwealth Brands, Inc., the country's fourth largest tobacco manufacturer will be relocating its corporate office to Goodlettsville in Spring 2011.

The Company has been based in Bowling Green, KY since it was formed in 1991, however, its ever growing employee base has resulted in it outgrowing its current premises.

"After an exhaustive search, which included Bowling Green and other parts of Kentucky, we finally settled on Goodlettsville," stated Jonathan Cox, the Company's CEO. "The city has gone out of its way to welcome us and the investment that we bring and, in the end, it was a decision that we are delighted with."

Commonwealth expects to bring with the move the majority of its 100 staff and already has plans for further expansion and employment opportunities. . . .

Tom Tucker, Director of Economic & Community Development for the City of Goodlettsville, said, "Goodlettsville is proud to welcome Commonwealth to our city. This is further endorsement that Goodlettsville offers the right combination of features that are attractive to business including large corporations."

Goodlettsville Mayor Gary Manning added, "We are very pleased that Commonwealth is committed to being a good corporate citizen through support of local community organizations."

"Commonwealth Brands, Inc.'s decision to relocate to Goodlettsville reiterates the fact that Middle Tennessee is a place where people and businesses want to be," said Ralph Schulz, president and CEO of the Nashville Area Chamber of Commerce. "Corporate headquarters are one of our top targets for job growth in the region, so Commonwealth's decision to join the growing base of headquarters in the region is a particularly significant one."

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• Guidance for Industry and FDA Staff: Enforcement Policy Concerning Certain Regulations Restricting the Sale and Distribution of Cigarettes and Smokeless Tobacco 

Under this section of the final rule, manufacturers may not use a trade or brand name of a nontobacco product as the trade or brand name for a cigarette or smokeless tobacco product unless the trade or brand name was on both the tobacco product and a nontobacco product sold in the United States on January 1, 1995. FDA is aware of concerns regarding this provision and is considering what changes, if any, would be appropriate to address those concerns.2 While FDA has this issue under consideration, it intends to exercise its enforcement discretion concerning 21 CFR 1140.16(a) not to commence enforcement actions under this provision for the duration of its consideration where:

(1) The trade or brand name of the cigarettes or smokeless tobacco product was registered, or the product was marketed, in the United States on or before June 22, 2009; or

(2) The first marketing or registration in the United States of the tobacco product occurs before the first marketing or registration in the United States of the non-tobacco product bearing the same name; provided, however, that the tobacco and non-tobacco product are not owned, manufactured, or distributed by the same, related, or affiliated entities (including as a licensee). . ..

At this time, however, in light of the court's order in Commonwealth Brands, FDA intends to exercise its enforcement discretion concerning 21 CFR 1140.32(a) not to commence enforcement actions under this provision during the pendency of the litigation irrespective of whether the entity is a party to the pending lawsuit or located in the Western District of Kentucky.

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Commonwealth Brands, Inc. in Disbelief Over FDA  

In an interview, Anthony Hemsley, Vice President of Corporate and Government Affairs, stated,

"Commonwealth Brands, Inc. fully supports measures that are specifically aimed at preventing youth smoking. However, the Food and Drug Administration continues to ignore the very industry it is supposed to be regulating. Despite numerous requests for meetings and consultation, our legitimacy and expertise is sidelined."

"The only way to create meaningful and proportionate regulations is to involve the industry. Issuing rules that only serve to jeopardize a legal industry that contributes billions of dollars in excise taxes, employs thousands of people across the states and maintains a supply chain involving thousands of retailers and distributors makes absolutely no sense whatsoever."

Two of the rules' provisions have already been proven to be unconstitutional by the courts and a third that seeks to remove many tobacco brand names from the market is clearly also against the industry's constitutional rights. . . .

"It is fundamentally wrong for the FDA to treat the tobacco industry differently from the other industries it regulates. Instead of forming a relationship to develop reasonable goals, the FDA appears solely interested in listening to vociferous, anti tobacco activists that have no concern for our adult consumers that purchase our legal products, or the viability or potential unintended consequences of what they are recommending."

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COMMONWEALTH BRANDS, INC v. FDA (PDF) 

Congress Constitutionally Regulated The Marketing Of Modified Risk Tobacco Products.

A. Promotional Claims Are Properly Considered As Evidence Of A Product's Intended Use In Determining Whether The Product May Be Introduced Into Interstate Commerce

B. Even If Viewed As A Restriction On Speech, The Pre-Market Review Requirement Is Narrowly Tailored To Further The Government's Substantial Interest In Protecting Consumers From Misleading Tobacco Industry Claims

1. The Modified Risk Provisions Advance An Extraordinarily Important Public Health Interest.

2. The Requirement Of Pre-Market FDA Review Is Narrowly Tailored To Accomplish Congress's Objective.

C.

Plaintiffs' Objections Are Meritless

1. The Communications That A Manufacturer Directs To Consumers About Its Product May Be Evidence Of The Product's Intended Use.

2. Plaintiffs' Challenge To The Criteria That Will Be Applied By The FDA In Considering An Application To Market A Modified Risk Tobacco Product Is Premature And, In Any Event, Meritless..

D. The Balance Of Harms Favors The Government And An Injunction Would Be Contrary To The Public Interest.

II. Congress Constitutionally Regulated The Marketing Of Tobacco Products In Combination With Other Products

A. Plaintiffs Have No Likelihood Of Success Of Their Challenge To The Combination Marketing Provision.

B. The Conduct Cited In Plaintiffs' Irreparable Harm Declaration Is Not Covered By The Combination Marketing Provision

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• Tobacco-product maker to expand 

The increasing popularity of roll-your-own tobacco products has given a boost to Commonwealth Brands Inc. at a time when local competitors are cutting back on production and jobs.

The company said yesterday that it is expanding its plant in Reidsville by adding a product line for cigarette tubes, which consumers use as a device for rolling or stuffing tobacco for a less-expensive smoke.

Commonwealth said it will create 35 jobs this year, expanding its local work force to 259 employees. It also will spend $6.7 million on capital improvements.

The company, based in Bowling Green, Ky., makes discount brands USA Gold and Sonoma, as well as cigarette tubes and blended and fine-cut tobaccos. It is a wholly owned subsidiary of Imperial Tobacco Group of England.

Commonwealth has about 3.8 percent of the U.S. market share, said Bill Godshall, the executive director of SmokeFree Pennsylvania.

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Ban on Color and Graphics in Tobacco Ads Thrown Out (Update2)  

A federal judge in Kentucky ruled that a new federal law giving the U.S. Food and Drug Administration jurisdiction over tobacco can’t prevent companies from using color and graphics to advertise their products.

U.S. District Judge Joseph H. McKinley Jr. ruled that provisions of the Family Smoking Prevention and Tobacco Control Act, signed into law by President Obama in June, violate the free-speech rights of advertisers.

McKinley, whose court is in Bowling Green, agreed with Reynolds American Inc.’s R.J. Reynolds Tobacco Co. and other companies that challenged the law, “that images of packages of their products, simple brand symbols, and some uses of color communicate important commercial information about their products.”

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Court backs some tobacco ad bans, nixes others 

A recent federal court decision moved public health advocates several big strides forward and a couple of steps back in their effort to defeat a free speech challenge to new Food and Drug Administration restrictions on tobacco advertising.

In a Jan. 5 ruling, the U.S. District Court for the Western District of Kentucky upheld most of the provisions in the federal Family Smoking Prevention and Tobacco Control Act that it said validated the government's interest in protecting consumers from misleading tobacco claims. The law, enacted in June 2009, gave the FDA authority to regulate tobacco for the first time.

Among the restrictions upheld by the court were a requirement for larger warning labels and a ban on the sale of modified-risk, or "light," products without prior FDA approval.

But the court took issue with the constitutionality of what it said were two overly broad provisions -- one prohibiting the use of color and graphics on advertisements and the other banning statements implying that FDA regulation of tobacco products makes them less harmful.

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