544 



We gambled $300 million and lost. That's business. If Philip Mor- 

 ris does not strive constantly to meet consumer demand, we will 

 fail in the American marketplace. 



Point two. Philip Morris does not manipulate nor independently 

 control the level of nicotine in our products. We voluntarily opened 

 our manufacturing operations to the FDA in a good faith effort to 

 resolve the allegation that we add nicotine or control its level in 

 our cigarettes. As representatives of the FDA learned, nicotine lev- 

 els in tobacco are measured at only two points in our manufactur- 

 ing process, prior to the tobaccos being blended, and then 18 

 months later when those leaves have been manufactured into fin- 

 ished cigarettes. 



Although Philip Morris maintains over 400 quality control check- 

 points in the manufacturing process that measure things like mois- 

 ture, weight, et cetera, none, not one, measure, report, or analyze 

 nicotine levels in tobacco. 



Commissioner Kessler indicated in his testimony that the nico- 

 tine to tar ratio increased as tar delivery decreased. The reason for 

 the slight increase in the nicotine to tar ratio in lower tar and nico- 

 tine cigarettes is not the result of intentional manipulation but the 

 result of the difference between filtering tar and filtering nicotine. 



Simply put, filters are more efficient in removing tar than nico- 

 tine. As tar and nicotine levels fall, proportionally more tar is fil- 

 tered out than nicotine. This does not mean that consumers of low 

 tar cigarettes get more nicotine. Quite the contrary. On an absolute 

 basis, far less nicotine is delivered per cigarette in lower tar and 

 nicotine deliveries. 



Commissioner Kessler suggested that during the period 1982 to 

 1991 tar delivery levels have remained flat while nicotine delivery 

 levels have increased. The fact is, after substantial decreases since 

 the 1950's, tar and nicotine levels both have remained relatively 

 flat during the past decade. 



Fact three. Philip Morris has not used patented processes to in- 

 crease or maintain nicotine levels. Commissioner Kessler spent a 

 great deal of his testimony attempting to support the proposition 

 that Philip Morris may be using secret patented processes to in- 

 crease or maintain nicotine delivery in our cigarettes. We have not. 

 We are not. 



Philip Morris, like every other corporation, applies for and ob- 

 tains patents on virtually every innovation that we pioneer. That 

 is critical to ongoing research efforts. Philip Morris currently holds 

 over 600 patents, only about a quarter describe processes ever 

 used. The processes described in the patents are no more secret 

 than the regulations of the FDA. They are publicly disclosed upon 

 issuance through the U.S. Patent Office. 



In his testimony. Commissioner Kessler said he had no evidence 

 that Philip Morris or any of the other companies ever actually used 

 any of these patents to increase or maintain nicotine levels. As he 

 correctly said, patents do not necessarily tell us what processes are 

 currently being used in manufacturing cigarettes. To make myself 

 perfectly clear, Philip Morris has never used any of the patents 

 Commissioner Kessler cited except those to reduce nicotine levels. 



Fact four — point four. Cigarette smoking is not addictive. During 

 the March 25th hearing, Commissioner Kessler and members of 



