James Wilmore

Comment - Energy Drinks Makers Face Uphill Struggle

By | 19 November 2012

Safety concerns around energy drinks have been thrust into the media once again

Safety concerns around energy drinks have been thrust into the media once again

It's not a good time to be an energy drinks producer in the US – at the very least from a public relations perspective. 

Media scrutiny of the sub-category has hit an all-time high, even if it has had more than its fair share of coverage over the years.

Now it appears the authorities have turned on producers too. Late last week, in an unusual move, the US government's Food & Drug Administration (FDA) voluntarily published details of “adverse event reports” involving three products – Monster, 5-hour Energy and Rockstar.

The reports, which at this point are just allegations, detail cases where energy drinks are cited involving illness, hospitalisation or, sometimes, death. I'm told by an FDA spokesperson that the decision to release this information came after an “influx” of enquiries from journalists and the agency wanting to appear “transparent”. 

But, why now for all this attention? What lit the fuse, it appears, was the reports last month that the family of a 14 year-old girl, who died after allegedly drinking two 24-ounce cans of Monster, is suing the company. Since then, Monster, and this week 5-hour Energy, have been the subject of negative headlines, brought on by the FDA records. 

However, the FDA freely admits that an adverse event report does not prove the product named caused the “adverse” event. All the reports on the website remain live investigations as well, I'm told. The problem the companies face is that, as soon as a product starts to be mentioned in the same sentence as “death”, it creates a nasty whiff. A bit like death. 

I suspect the FDA will also no longer appear on the companies' Christmas card lists after publishing this information, which can only fan the flames of the media panic. 

But, is the panic justified? One argument that both Monster and Living Essentials, the producer of 5-hour Energy, put forward is that their products contain about the same amount of caffeine as coffee sold by chains across the US. As Living Essentials CEO billionaire Manoj Bhargava told Fox News: “If you're going to go after caffeine, what about coffee?” This is a compelling point. However, the FDA spokesperson I talked to said she had no recollection of coffee being cited in adverse event reports. On the other hand, the agency received around 2,000 reports about liquid dietary supplements – the category energy drinks fall into – in 2011. 

The reason that Red Bull was banned in France for ten years was partly because of the presence of the amino acid, taurine, in the drink. Both Monster and 5-hour Energy, and indeed Rockstar, contain taurine. But I'm no scientist, so let's leave that there. 

Energy drinks remain incredibly popular. 5-hour Energy alone has sold around 1.5bn units of its shots since launch. Will this current scare fade like others, while the companies ride out the negative media wave? Or, are we witnessing the beginning of the end for energy drinks in their current format?

Expert analysis

Energy Drinks and Energy Shots - US

This report explores the energy drinks and shots market. Energy drinks and shots continue to thrive for their functional positioning, particularly providing an energy boost. The market faces a number of issues, the biggest one focused on the possibly harmful side effects of consuming energy drinks and shots.This report addresses this and other issues and explores growth-driving opportunities.

Sectors: Legislation, Soft drinks

Companies: Red Bull

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