Four Loko Ban Highlights Gov. Control Strategy

Four Loko never claimed to be sane or responsible, as this commercial proves.

The FDA doesn’t like drink manufacturers putting caffeine in their malt liquors, and has threatened to seize “blackout in a can” Four Loko and four other drinks–or stop their producers from doing business–if they don’t modify their formulas in the next 15 days. Bloomberg BusinessWeek has the story:

Caffeine is an “unsafe food additive” to malt alcohol beverages, the U.S. Food and Drug Administration told four makers of alcoholic energy drinks after a yearlong probe into reports of hospitalizations and deaths.

The federal government may seize the products if companies don’t remove the caffeine from them, the FDA said today in a statement. The agency sent warning letters to Charge Beverages Corp., New Century Brewing Co., United Brands Co. and Phusion Projects LLC, the closely held maker of Four Loko.

The four companies also were warned by the FTC that the marketing of those drinks may constitute unfair or deceptive trade practices.

From the Washington Post:

Phusion Projects said in a statement that it planned to “reformulate its products to remove caffeine, guarana and taurine nationwide. . . . Going forward Phusion will produce only non-caffeinated versions of Four Loko,” the company’s most popular drink.

“We have repeatedly contended – and still believe, as do many people throughout the country – that the combination of alcohol and caffeine is safe. If it were unsafe, popular drinks like rum and colas or Irish coffees . . . would face the same scrutiny that our products recently faced,” said Chris Hunter, Jeff Wright and Jaisen Freeman, the company’s managing partners. “We are taking this step after trying – unsuccessfully – to navigate a difficult and politically charged regulatory environment at both the state and federal levels.”

I don’t buy Fusion Labs’ argument. Irish coffees do not get you as violently drunk as quickly as Four Loko, which appears to be specifically formulated for maximum inebriation.

Yet the FDA is also using a convoluted strategy to make its case. By regulating this class of 12% alcohol malt liquors, the FDA appears to be outside its usual jurisdiction (the FDA usually does not regulate alcohol or “malt beverages,” so I’m not sure how it was able to call Four Loko a “food” and apply a food additive ruling). Note that the ruling also applies only to alcohol-infused drinks like Four Loko, not everyday drinks like rum and coke or Irish coffee.

How they draw this line from a legal standpoint is unclear. Here’s the FDA’s rationale, from its website:

FDA’s action follows a scientific review by the Agency. FDA examined the published peer-reviewed literature on the co-consumption of caffeine and alcohol, consulted with experts in the fields of toxicology, neuropharmacology, emergency medicine, and epidemiology, and reviewed information provided by product manufacturers. FDA also performed its own independent laboratory analysis of these products.

“FDA does not find support for the claim that the addition of caffeine to these alcoholic beverages is ‘generally recognized as safe,’ which is the legal standard,” said Dr. Joshua M. Sharfstein, Principal Deputy Commissioner. “To the contrary, there is evidence that the combinations of caffeine and alcohol in these products pose a public health concern.”

Experts have raised concerns that caffeine can mask some of the sensory cues individuals might normally rely on to determine their level of intoxication. The FDA said peer-reviewed studies suggest that the consumption of beverages containing added caffeine and alcohol is associated with risky behaviors that may lead to hazardous and life-threatening situations.

The agency said the products named in the Warning Letters are being marketed in violation of the Federal Food, Drug, and Cosmetic Act (the FFDCA). Each Warning Letter requests that the recipient inform the FDA in writing within 15 days of the specific steps that will be taken to remedy the violation and prevent its recurrence. If a company does not believe its products are in violation of the FFDCA, it may present its reasoning and any supporting information as well.

The federal government, like the IRS and health insurance companies, is using labyrinthine bureaucracy and incomprehensible policies to paper whip these companies into submission.

“The agency has not approved the use of caffeine in alcoholic beverages at any level,” according to the FDA website, but why would it? It isn’t supposed to regulate alcohol–that’s the Bureau of Alcohol, Tobacco, Firearms and Explosives’ job. So caffeine in alcohol is considered a food additive, which means that the FDA considers malt beverages like Four Loko foods rather than alcohol. Or something. Good luck untangling that, Fusion Labs.

Also, the FFDCA is a dense, almost incomprehensible document. It’s hard to pick out a cogent law in the FFDCA’s sea of words. This basically means that any business without the connections, time and legal fees required to make sense of the law, let alone figure out a way to circumvent it or disprove the FDA, has to comply by virtue of lack of resources.

Bottom line: Four Loko has to submit, or it will either be forced out of business by the FDA or put itself out of business with legal fees or the extensive research required to maybe prove the FDA wrong.

It probably doesn’t help that the group of attorneys general who launched their anti-caffeinated-alcohol vendetta in 2007 previously pushed “MillerCoors Brewing to drop Sparks Red, an energy drink with boosted alcohol content,” according to the Auburn Reporter. “The same year, several AGs launched investigations of MillerCoors and Anheuser-Busch, two major producers of AEDs (alcoholic beverages to which caffeine and other stimulants),” says the Reporter. Those big corporations likely got behind the attorneys general and the FDA when they saw Fusion Labs and other companies grabbing the market share they’d been blocked from.

Without going into the shoulds and should nots of this ban, I will say that it’s a fascinating case study on the strategy government regulators use to force companies into compliance.

Written by Drea Knufken

Drea Knufken

Currently, I create and execute content- and PR strategies for clients, including thought leadership and messaging. I also ghostwrite and produce press releases, white papers, case studies and other collateral.