Posts Tagged ‘media buzz’
Palcohol is back.
After approval from out of nowhere about a year ago, and cancellation of the same approvals a few days later, it is back. I have it on good authority that TTB has ironed out the kinks and approved the labels this week. Sen. Schumer will not be pleased (aka, he may be very pleased to have this whipping boy back within striking distance). Many states have already banned it. But this gives new life to this new category. Hats off to Mark Phillips for weathering the storm and persevering.
Below is the approved label as of 2014 alongside the label as approved on March 10, 2015. There are small, technical changes, mostly relating to how to measure the taxable commodity. Boxes 20 and 23 reconfirm that it took Mark almost a year to get this approval. The back label makes it look like an awful lot of work and controversy for a small amount of alcohol (when prepared, it only has half the liquid of a beer, and 1/4 the abv compared to vodka?!?).
In an email on the day of re-approval, Mark, the force behind Palcohol, explained:
Yes, Palcohol is back. It’s been quite a journey, over four years to get Palcohol approved by the TTB. I do want people to know that the TTB has been great to work with. Very fair and professional. And I’m not just saying that to kiss up to them as they have now approved Palcohol and it’s done.
The next challenge is trying to stop the states from banning it based on misinformation and ignorant speculation. It is a mistake for a state to ban Palcohol because…
What was the best beer ad, or ad of any type, in yesterday’s Super Bowl broadcast? Hint, it was a Bud ad, but not the one with the dogs, horses, and wolf. Instead, it was the one above. The one in which Bud took on its main competition, directly and powerfully, roughly like those on the field. It’s the first time in many years that Bud did not seem to be on the defensive. It seems clear that Bud’s plan is to defend Bud the brand such as above, and defend Bud the company by buying a bunch of esteemed craft brewers. Maybe they can have their cake and eat it too.
- The 60 second ad opens with a view of an old brewery with a big Budweiser sign and a small American flag atop it; the building is bathing in the sun and surrounded by trees and evokes old-time Americana within a couple seconds.
- Within five seconds, it says BUDWEISER, PROUDLY A MACRO BEER and shows lots of real and good looking ingredients, to go along with the pretty buildings way back at seconds 1 and 2.
- The ad takes dead aim at and skewers various hipsters such as the ones above. Hipster number 1 is perfect, with his mustachio, earnestness, believability, dancing eyebrows. The others are just as good, as they fumble and fawn over their wee glasses of beer, as much as is probably possible in the span of 2 seconds.
- The music is just right and sets a defiant tone.
- Lots of big machines, big horses and Bud’s history are packed into this ad; it yields nothing in terms of declaring the work that goes into making this beer great.
- It suggests those hipsters are phonies and don’t necessarily enjoy drinking beer as much as normal Bud consumers.
The ad is so good, and so expertly crafted that I can’t even think of any ways to try to refute or find fault with it. Now, having said that, I am eager to go to others to see what I missed in this ad that overflows with powerful imagery.
I was surprised to see Paste call it anti-craft rather than deftly pro-Bud. The article seems to say Bud spent $9 million to air it and I would not be surprised if it cost even more to produce it (or as much as an average movie of 90 times the duration). The Atlantic calls it the event’s riskiest ad and says it’s likely to appeal to those over but not under about 40. The LA Times points out that the ad touts that it’s for people who like to drink beer, but asks you to notice that “the ad doesn’t say the beer is for people who like to taste beer.” The article says most of the ad is on target and wraps up saying “Craft drinkers have dismissed macro beer and have been openly condescending to its fans for years; turnabout is certainly fair play.” Ad Age says, and I agree, the ad is notable for its swagger. The ad, by Anamoly, “marks the return of ‘This Bud’s For You,’ which has not been used in a significant way in Bud advertising since the late 1970s, according to the brewer.”
The debate still rages over whether Bud is good beer. But the debate is over about whether Bud can craft good ads.
The Daily Beast published a highly relevant story a few days ago, slamming Fireball and propylene glycol. Fireball is a hugely popular “Cinnamon Whisky,” and a recent label approval is here. The story explains that Fireball contains propylene glycol, commonly known as PG, and in the most alarming way that could probably be set forth without a big lawsuit, the article heaps scorn upon PG and Fireball. As of today, Google has more than 81,000 stories about fireball propylene glycol, but the Beast story was one of the first.
The article trots out alarming buzzwords such as: recall, antifreeze, swill, Prestone, Low-Tox, disease, health risks. It says:
One key ingredient of the stuff: Propylene glycol, a synthetic liquid that absorbs water. The Centers for Disease Control note that it is used to ‘make polyester compounds, and as a base for deicing solutions.’ In food production, the CDC adds, the syrupy stuff also can be used to “maintain moisture… It is a solvent for food colors and flavors.”
I called on a few experts in writing this blog post because I think Tim Mak’s article may be unfair to Fireball, its producer (Sazerac) and the important food chemical known as propylene glycol. Kevin at Nutrevolve sums it up pithily: “Anyone who has compared propylene glycol to anti freeze to inspire fear has done nothing but demonstrate a lack of chemistry knowledge. … Notorious for regular application of the Precautionary Principle, even CSPI gives the propylene glycol derivative, propylene glycol alginate a green light – see here.”
I talked it over with Kate Ratliff. Kate is the Technical Director at Flavorman, a leading flavor and beverage company headquartered in Louisville. By the way I think Tim is a great writer, and he picks great topics, such as this gem about beer labels. But the Beast article seems like a prime example of junk science; it is sensationalist and it actually makes readers and consumers dumber. It does no favors for the Beast’s readers, or for anyone who cares about science, or high quality foods. The tenor of the article is inconsistent with the fact that propylene glycol has been widely and safely used in a large percentage of foods and beverages, over more than 50 years, around the world. Many food products would not be as good without this key building block. Even if you are looking at an ingredient list on a food label, and PG is not noted, it may well be in the package and probably is. This is because PG is used in thousands of flavors, and there is no requirement to show a flavor’s ingredients on any food label. Moreover, most alcohol beverage labels do not show any ingredient list at all, and ShipCompliant’s amazing LabelVision system shows not even one label that mentions PG (among over 1.5 million indexed labels, and hundreds of thousands of alcohol beverages that probably contain this substance).*
When I talked it over with Kate, she said “Robert, don’t be silly. Everything has established toxicity levels, even things like water and vitamins. Yet, we are encouraged to drink lots of water and supplement our diets with multivitamins. PG is fine.” I happened to be down the street from Sazerac’s plant yesterday, at Kate’s office, whereupon she offered me a shot of propylene glycol, straight up. With assurances from her colleagues (and FDA) that it’s safe for human consumption, I sipped the PG. It seemed oily and bitter, and wholly without any smell. The bitter aftertaste lingered for a few minutes and later I tasted a small amount of sweetness. I am pleased to report that I woke up just fine this morning without any apparent effects. For the record I note that the city and her plant are full to brimming over with some of the finest beverages in the world, but Kate only offered me the PG and a bottle of water.
We thought it was important to respond to Tim’s article because it seems clear that it is aimed at low-information consumers such as your typical frat boy. The article is replete with references to “Bummer, Dude” and Total Frat Moves, not exactly paragons of nuance or subtlety (and yes, the Food Babe also has it wrong). We think they are likely to take away precisely the wrong message — for example the entirely incorrect idea that PG is worse than too much alcohol, or too much sugar, or too much junk food. Or, the entirely wrong idea that Fireball is somehow worse than any of the next 10 cinnamon whiskeys, which probably contain PG as well. The Beast story also tends to suggest that US regulators such as FDA and TTB are asleep at the switch here, and once again this is highly misleading or wrong.
Flavor expert Vince Ficca explained that it is important to use PG as a solvent where alcohol is not a good choice; for example, to bring down the flashpoint, or for countries (such as Muslim countries) where alcohol is not legal. Vince also pointed out that nobody should confuse PG with its toxic cousin, ethylene glycol. Good old Wikipedia explains:
Propylene glycol … is considerably less toxic than ethylene glycol and may be labeled as “non-toxic antifreeze”. It is used as antifreeze where ethylene glycol would be inappropriate, such as in food-processing systems or in water pipes in homes where incidental ingestion may be possible. As confirmation of its relative non-toxicity, the FDA allows propylene glycol to be added to a large number of processed foods, including ice cream, frozen custard, salad dressings and baked goods.
Fireball does a nice job of injecting some reason into this discussion here:
Fireball does not contain any antifreeze at all and the suggestion is ridiculous. Sadly, this is the media’s way of crafting attention grabbing headlines, but it simply is not true. We would not dream of putting antifreeze in our product. … PG is a clear, colorless liquid with the consistency of syrup. It is practically odorless and tasteless. It is the ideal stabilizer and clarifier for a large variety of flavors that give most of today’s food and beverages their distinctive taste. … Flavor companies use it to carry flavor ingredients through to the final product, to preserve the integrity of the flavor and to ensure it is shelf stable. We understand that very few flavors can be made without it.
Food scientists tell me it would take many ounces of PG at a sitting to induce a harmful effect in an average person. A bottle of Fireball has less than an eyedropper full of PG. Please don’t take any of this as medical advice. But, now that the Ice Bucket Challenge is passe, I want to publicly call out Tim for the PG challenge. He should put up some examples of ill effects from PG, or drink a shot of PG forthwith.
* Stop the press. LabelVision did find one lonely label unabashedly declaring the presence of PG, and it’s here.
Palcohol is probably the biggest story in my 25 years of working with alcohol beverage law. As much or more media interest as compared to absinthe or Four Loko, or even direct shipping. Palcohol went from zero results on Google as of April 18th to more than 2 million as of this writing (and 4 million as of May 2). By some measures it’s bigger than Rhianna.* So, what happened? This FAQ expands on and updates our original blog post first published on April 18.
- What is Palcohol?
It is powderized alcohol. By the way, we don’t represent Palcohol or speak for them. The technology is explained here.
- Why does it matter?
It is much more portable as compared to heavy liquids. It is not clear that the US Government has ever approved a powdered alcohol in the past, even though the technology has been around since the 1970s.
- Is it approved or not?
The Palcohol company has made a huge amount of progress toward bringing this to stores. They have about five formula approvals and a distilling permit. These are big projects and major accomplishments. Formula approval usually takes a couple of months and involves a thorough review of all ingredients and methods. The permit usually takes six months or more and involves background checks, plant diagrams, lists of equipment and a review of security measures. Beyond all this, the company secured label approval for about five powdered alcohol products on April 8. This is the last step in the federal system. For two weeks Lipsmark (the company) had all federal approvals necessary to make and sell the product. Then, on April 21, Lipsmark “voluntarily” “surrendered” those approvals. It is not yet clear why the Palcohol company would do this. It is not yet clear if or when the company will secure new and replacement approvals. The government has no authority to simply cancel the approvals, so that is not a plausible scenario. The government simply says the approvals were “issued in error.” The company has said it is a technical issue related to the labeling only, not the underlying concept, product or formulas, and they are working with TTB to remove this issue. It probably relates to making it clear how the taxable commodity (the quantity of alcohol) can and should be measured and disclosed on the labels.
- Is it good or bad?
The good is, innovation is good and this is innovative and indeed, perhaps, transformative. If you are an active camper, for example, it could be great. The good is, this is likely to encourage a substantial debate about an important public policy issue, and perhaps it can be done in a mature and fruitful way, allowing our system to show that it can still function well. In addition, this could spark the relevant agencies to get with the times and modernize some archaic alcohol control measures, fairly and properly. Also, this may be a great opportunity for the marketplace (of dollars and not just ideas) to play a key role in deciding this, as it has done so often in the past. For almost 100 years, most governments and tut-tutters around the world assumed the sky would fall if absinthe got legalized. The opposite happened. Upon legalization in 2007, a lot of the taboo and fascination evaporated (because, sadly and plainly, American consumers are not wild about anise-type tastes.)
The bad is, it opens up many new ways to abuse alcohol. For example, it’s just a matter of time before some punk tries to snort this and puts his antics on YouTube. But on a more pedestrian level, think about Applebees and Outback. Last year, most customers would walk in and buy a beer or Margarita for $6 or more apiece. By next year, will they sit down and instead dump a packet of Palcohol into the house-provided tap water — buying zero drinks on the premises? That would be a calamity for the hundreds of thousands of bars and restaurants around the country, in that they derive a huge percentage of revenue and profits from traditional alcohol beverages. The same with cruise lines, airplanes, concerts, sporting events, on and on. This has the potential to be highly disruptive, like Amazon selling books — or Amazon selling wine. (5/8/2014 edit; Mark Phillips does quite a good job rebutting most of this here.)
- Why is it so controversial?
Because of all the bad and good at point 4 above.
- When can I get some?
It will probably be several months, at least. Even if Lipsmark did not surrender the label approvals, they would still have lots of work to do before racking up some sales. They need to find and sell through wholesalers and get a bunch of agency approvals in every state they sell into. I talked to one New York expert, for example, and he tended to say New York would not go fast to allow this. Ironically, Lipsmark probably has all necessary US approvals by which to make this in Arizona and sell this in countries outside the US (or could easily get such approvals).
- Is it new?
The technology is not new. It has been around since the 1970s. Here is a 1977 newspaper article and a 1978 article about another powderized alcohol product called SureShot. Mike Hill was the force behind SureShot according to the articles; he has recently explained by phone and email that he got past federal approval to test marketing and commercialization, but his company was never able to overcome various technical problems such as clumping, bulk, expense, and the need to use warm water to dissolve the beads. Our earlier post mentions the past patents on similar products. The new part is that, at least for the first time in 30 or more years, Palcohol actually got past federal formula and label approval, even if only temporarily. This is a big and important step and not to be minimized.
- What agency?
TTB did most all the review and approval here. TTB is a sub-unit of the US Department of Treasury and this makes sense in that a huge aspect of alcohol beverage regulation is making sure the taxes get duly collected. Almost always through history, the tax has been based on the volume of alcohol; that’s tough to measure here. In the 1970s this agency was part of the IRS and in the 1980s it was known as ATF. FDA has not played a big role in the Palcohol matter to date, so far as we know. By contrast, in the matters of absinthe and Four Loko, both FDA and TTB played big roles.
- What brilliant lawyer persuaded TTB to allow this?
So far as we can tell, Mark Phillips did this on his own, without help from any lawyers. This is an impressive accomplishment. Mark has said he worked with TTB on this for many years, patiently and cooperatively. Perhaps Mark had a bit of “beginner’s luck” on his side. On the other hand, the same absence of seasoned experts may have led to various stumbles like not realizing all label approvals are public, and that it’s not wise to make light of alcohol abuse, even on a draft web page.
- Why would TTB approve this then quickly change course
It is tough for TTB to withhold approval when the law provides no clear basis to do so. The law probably did not anticipate something new and different like this, just as the relevant rules, most of which were written many generations ago, have failed to anticipate and show the way on many other new things like caffeinated malt beverages, booze with vitamins, gluten-free beer, kombucha, even saké. What would you do if presented with this question? If you are feeling tough and would disallow it, under what rule? And if you can’t find such rule, what specific rule would you write? I think these are tough questions and I don’t think TTB has an easy job when it comes to things like this. Unlike other agencies, TTB is put in the unenviable position of giving a thumbs up or a thumbs down on every cockamamie marketing idea that comes down the pike. TTB does not have the luxury of saying “no action” like so many other agencies use to sidestep the trickiest issues. Why change course? It is possible or even likely that various states, other alcohol beverage companies, various interest groups, doctors, the media, legislators, and others across many segments of our society — screamed bloody murder. To the extent this happened, I submit this is a good thing and supports my point that this is a great opportunity for our system to rise to the occasion and function well to make a good and appropriate policy as to something new and controversial like this.
- What next?
If Palcohol gets new label approvals within a few days, the “surrender” is probably a little speedbump on a long road. But if it goes past a couple of weeks without new and replacement label approvals on the public database, it is a strong sign that it may be tough for Palcohol to re-acquire label approvals. There is no lawful way for Palcohol to sell powderized alcohol in the US without these crucial approvals.
- How did you find this?
John Messinger (a lawyer in our office) was doing routine research on margarita issues (things like, can the food coloring go on the back label). I am sure he expected to find various liquids, like almost always in the past. Instead he saw a big, fat reference to “powdered alcohol” on the front label — with a little pyramid of powder depicted. He found this via the amazing search capabilities of ShipCompliant’s LabelVision service, as well as other specialized search capabilities we have in the office. These tools make it easier for us to scour millions of government records. TTB approves well over 100,000 labels per year and puts them on a Public COLA Registry; we try to review most to keep an eye on new trends and rulings, like this.
- Why won’t TTB and Lipsmark say much?
TTB has publicly said the labels are approved (April 8) and “surrendered” (April 21). TTB has said the label approvals were “issued in error.” TTB is not likely to say a lot more, based on past precedent. A lot of this is highly confidential, as between an applicant and the government. TTB has a good history of keeping confidential information confidential, as is necessary and required, just like IRS. TTB is dealing with tax information and things like recipes. Few things are more confidential or more valuable trade secrets as compared to for example the recipe for Jaegermeister or Kahlua. As for Mark Phillips, I am not sure why he has not said more. He does have a fair amount of information on his website now. I conferred with Mark a few times after he contacted me but we don’t represent Palcohol and can’t speak for them. (5/8/2014 edit; Mark Phillips does quite a good job rebutting most of this here.)
- What else?
Lots of other information and links are set out in our earlier posts on this topic (such as the labels, a sample label approval, a surrendered approval).
If you like booze and the law, it should be fun to watch this further.
* And in a fine moment for lawyers everywhere, let the record reflect that the Today Show crew said they left the Chris Brown hearing early to come talk to me about Palcohol.
As of April 8-21, 2014, this was approved. The federal government approved this brand of powderized alcohol two weeks ago. The reviewing agency has been TTB (not FDA, as some press accounts have said). TTB is a sub-unit of the US Department of Treasury.
April 21, 2014, 5 pm ET, Update: The Palcohol company has surrendered all seven label approvals back to TTB. Here is one of the labels as approved on April 8, 2014 and then the same label as “surrendered” April 21. The differing status is shown at the center of each document. TTB has not said much about the change of course. Palcohol has said: “We have been in touch with the TTB and there seemed to be a discrepancy on our fill level, how much powder is in the bag. There was a mutual agreement for us to surrender the labels.”
May 8, 2014, 3 pm ET, Update: Sen. Charles Schumer has blasted Palcohol and pressed FDA to step in, during the past week. Many sources and links on web. And, Mark Phillips does quite a good job rebutting most of the critics here.
I am not astonished that this is a real product — but I am absolutely astonished that this got approved. TTB approved seven versions of this powdered alcohol label on April 8, 2014. It is seven labels covering five products (two rum-like, two vodka-like, one Cosmopolitan-like, one Lemon Drop-like, and one Margarita-like).
- Prediction. The system will work, if not right away, soon. Rules and rulings will be made. Something like democracy will happen. Most of this stuff would need to go through licensed wholesalers with a strong stake in the status quo, so don’t assume they will be eager to carry this. After the initial shock value, perhaps this will be as rare as vodka tampons, eyeballing and vodka injections. Also, the Palcohol company had better get some really, really good liability insurance. Perhaps an enterprising reporter can call some insurance vendors to see if it’s available at any price for a product like this.
- Historical context
- Video: CBS Morning News, Today Show, WFTV, Palcohol rebuttal to e.g. Sen. Charles Schumer
- Mark Phillips, The Palcohol Company, Lipsmark LLC of Tempe, Arizona
The person that pushed this through must be very patient or lucky and/or good. The product seems highly likely to raise a large number of legal issues and controversies. The company’s website (as of a few days ago) tended to underscore the controversies, saying: “What’s worse than going to a concert, sporting event, etc. and having to pay $10, $15, $20 for a mixed drink with tax and tip. Are you kidding me?! Take Palcohol into the venue and enjoy a mixed drink for a fraction of the cost.” And:
We’ve been talking about drinks so far. But we have found adding Palcohol to food is so much fun. Sprinkle Palcohol on almost any dish and give it an extra kick. Some of our favorites are the Kamikaze in guacamole, Rum on a BBQ sandwich, Cosmo on a salad and Vodka on eggs in the morning to start your day off right. Experiment. Palcohol is great on so many foods. Remember, you have to add Palcohol AFTER a dish is cooked as the alcohol will burn off if you cook with it…and that defeats the whole purpose.
The current Palcohol website is much more tame and also has a short bio for Mark Phillips, the force behind Palcohol. Over the weekend Mark confirmed that he was in fact quite patient about this; he said: “The TTB was cautious. It took us nearly four years to get the approval.”
California seems to have been way out in front of this with Regulation 2557. We are not aware of directly and specifically relevant TTB rules, and this may well explain why no rules blocked the initial approvals. Many thanks to John for finding these Palcohol approvals among millions of obscure government records.