SENATE PANEL RELEASES TOBACCO BILL, LEAVES SHIELDS FOR COMPANIES UNFINISHED

WASHINGTON, D.C. -- Negotiators on Sunday agreed on most of the provisions
of Congress' leading tobacco bill, which would charge the industry about
$138 billion more and impose harsher restrictions than the settlement
companies and states reached in June.

Negotiators also approved broad authority for the Food and Drug
Administration (FDA) to regulate nicotine products, a victory for the
health community and the White House. But the bill also would set strict
guidelines for the FDA if it ever tries to ban nicotine.

However, negotiators left unfinished the central issues of debate: how
much, if any, legal protection to give the industry, and how to spend the
$506 billion over 25 years the companies would pay.

Several negotiators in the round-the-clock talks -- involving about two
dozen major players including representatives of federal agencies, private
health care groups and the White House -- said the sponsor, Senate Commerce
Committee Chairman John McCain, probably would announce the plan for legal
protections at midweek and leave the funding question unanswered, to be
debated on the Senate floor.

McCain, R-Ariz., plans for his panel to formally consider the bill
Wednesday, aiming to report it to the full Senate by the end of the week,
when Congress leaves for Easter recess.

McCain's panel has used as its starting point the $368 billion settlement
reached in June among the companies and 40 states suing them.

The issue of immunity stalled negotiators over the weekend as new fighting
broke out over what kind of, if any, legal shields should be granted to
tobacco companies. A proposal under discussion would ban class-action suits
for past wrongdoing and cap the amount of future damages tobacco companies
could pay out in a year at $6.5 billion. But the companies that do not
adhere to advertising and other restrictions would lose some of that
protection.

Negotiators did approve broad authority for the FDA to regulate
advertising, youth access to tobacco and new products containing nicotine.

Republicans on the committee set strict guidelines that would govern the
FDA's conduct should it ever decide to ban nicotine products. Under the
provision, any ban on nicotine, retail sales or tobacco products "would
require presidential notification to Congress and include a two-year
waiting period for Congress to act," according to the draft summary
released Sunday by McCain.

Other provisions of the bill, to be formally announced today, would:

Provide general guidelines on how to spend the money raised by the act. The
money, according to the draft, should be used only for programs, health
research, public health care reimbursement and farmer assistance.

Establish a nonprofit corporation and funds for "international control
programs."

Raise the price of cigarettes per pack by $1.10 by 2003.

Establish a depository for cigarette companies' internal documents.

Allow local and state governments to impose additional tobacco product
control measures.

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