Even under the watchful eyes of the U.S. Food and Drug Administration, tobacco companies such as Henrico County-based Altria Group Inc. will have opportunities to thrive, some industry observers say. That’s because the legislation passed by Congress this week giving the FDA authority to regulate the industry leaves some doors open for tobacco companies to innovate, and even to make health claims about products, something they cannot do now.

A force in Virginia’s economy and culture for 400 years, the business is headed toward potentially sweeping changes under legislation approved by the U.S. Senate yesterday.

Federal regulators are cracking down on a cigarette substitute that uses technology similar to devices that Philip Morris USA researchers have focused on in recent years. Meanwhile, Virginia Commonwealth University is studying how much nicotine—the addictive compound in tobacco—the “electronic cigarettes” deliver, under a grant from the National Cancer Institute to look at nicotine products.

Philip Morris USA and other U.S. cigarette makers lost an appeal yesterday to a 2006 landmark ruling that found the nation’s top tobacco companies guilty of racketeering and fraud for deceiving the public about the dangers of smoking.

The nation’s top cigarette maker is moving quickly to strengthen its business in tobacco products such as snuff and cigars as cigarette volumes erode, the top executive for Altria Group Inc. told shareholders yesterday. “Since the shareholder meeting in May of last year, Altria has continued to transform itself as adult tobacco consumer preferences have evolved,“ said Michael E. Szymanczyk, the company’s chairman and chief executive officer.

About 530 Philip Morris USA employees accepted transfers to Richmond from the company’s cigarette plant near Charlotte, N.C., but few, if any, others are expected to relocate as the company shuts down the North Carolina plant this summer. Henrico County-based Philip Morris USA announced yesterday it will cease production at its Cabarrus County, N.C., plant by the end of July, months earlier than initially expected. Most of the plant’s remaining 1,100 employees will be laid off as the company consolidates its manufacturing operations at its South Richmond cigarette plant.

In what Fortune magazine called the worst year ever for companies on its Fortune 500 list, the Richmond area held its own, though with some major footnotes. Seven companies are on the list, down from eight.

U.S. Smokeless Tobacco Co. is cutting jobs in its sales work force as it combines operations with its new parent company, Henrico County-based Altria Group Inc. The job cuts will affect 16 employees in Virginia, including three at a regional sales office in Richmond, Altria spokesman David Sylvia said yesterday. Altria bought U.S. Smokeless’ parent, UST Inc., in January for $10.4 billion, plus $1.3 billion in assumed debt. U.S. Smokeless is now a subsidiary of Altria, along with cigarette maker Philip Morris USA and cigar maker John Middleton Inc.

The nation’s top cigarette maker and top moist snuff company are looking for new ways to keep tobacco consumers buying their brands now that they have combined forces in the Richmond area.

The nation’s largest maker of smokeless tobacco products is now operating its business from Altria Group Inc.‘s Henrico County headquarters campus. About 80 employees of U.S. Smokeless Tobacco Co., the former UST Inc. which Altria bought in January, are moving to the Richmond area, company president Dan Butler said today. That includes employees from UST’s former headquarters in Stamford, Conn. which is closing this year.

The Supreme Court yesterday threw out Philip Morris USA’s appeal of a $79.5 million award to a smoker’s widow, ending a 10-year legal fight to keep her from collecting. In a one-sentence order, the court left in place a ruling by the Oregon Supreme Court in favor of Mayola Williams.

The U.S. Supreme Court today threw out a cigarette maker’s appeal of a $79.5 million award to a smoker’s widow, likely signaling the end of a 10-year legal fight over the large payout.

However they satisfy their nicotine cravings, tobacco users are facing a big hit as the single largest federal tobacco tax increase ever takes effect tomorrow. Tobacco companies and public-health advocates, longtime foes in the nicotine battles, are trying to turn the situation to their advantage. The major cigarette makers raised prices a couple of weeks ago, partly to offset any drop in profits once the per-pack tax climbs from 39 cents to $1.01.

Altria Group Inc., the largest U.S. tobacco company, will raise prices on Marlboro and 17 brands on March 9 ahead of an increase in federal tobacco excise taxes.

Ten of Virginia’s top 20 revenue-producing public companies combined to spend more than $100,000 a day lobbying the federal government last year, records show. As CEOs grappled with a sliding U.S. economy and then-candidate Barack Obama targeted corporate influence in Washington, eight Virginia-based companies—including the Richmond area’s Altria Group Inc., Genworth Financial Inc. and Dominion Resources Inc.—each spent more than $1 million in 2008 trying to influence lawmakers.