Kombucha Controversy: Is the Government Killing a Super-Healthy Drink Market?

After a year's worth of promising sales, Honest Tea is pulling its probiotic-containing kombucha beverage off the market. The reason: impending government regulation due to the trace amounts of alcohol contained in the trendy drink.

Normally, products that have an alcohol content of less than 0.5% don't get roped into the hairy details of regulation, taxes and warning labels associated with alcoholic beverages. Earlier this year, after much noise from the Alcohol and Tobacco Tax and Trade Bureau (TTB), Honest and other kombucha manufacturers adjusted their brewing process so that their products fell safely below that 0.5% threshold. But, in an email to BNET, Honest spokesperson Samme Menke wrote that the TTB still has not dropped the issue:

Kombucha is a product and a category that we've come to love, but the changing regulatory environment has led us to conclude that we will no longer be part of this exciting, but ultimately challenging category. We recently learned that federal regulators are in the midst of changing their expectations for the kombucha category, including the fact that if a product has the potential to become an alcoholic beverage, then it is expected to be labeled and regulated as such.

On its web site, the TTB seems to indicate that it considers the even the lower-alcohol kombucha to be an alcoholic beverage because the alcohol content could increase to "0.5 percent or more due to the continued fermentation in the bottle."

Although kombucha, a fermented tea that's been consumed in Russia and China for hundreds of years, has never been studied in scientific experiments, it's full of beneficial live bacteria -- often referred to as probiotics -- that are thought to promote healthy digestion and support the immune system. Scientists are just starting to learn about the ways in which the presence of good bacteria in our guts play a crucial role in keeping us healthy.

(It should be noted that scientists like to use the term probiotics to refer only to the roughly two dozen bacteria strains that have been proven by science to have a health benefit. The hundreds of other strains simply haven't been tested.)

GT Dave, CEO of Millenium Products, which makes GT's Kombucha, the leading brand, says that he's willing to live with the prospect of government regulation. He says the company has already finished getting the licensing to produce a kombucha product that will be taxed and can only be sold to people over 21. "This is something we're willing to do so that people can still have access to our product," he says.

Related:

• Why Coke Needs -- and Will Likely Buy -- Honest Tea
• Coke's Strange New Tea Concoction Signals That It's Finally Serious About Innovation
• Judge Says Vitaminwater Might Be Fattening: Why Doesn't Coke Understand the "Jelly Bean Rule"?