Popular alcoholic energy drink to remove stimulant from recipe as government is poised to ban caffeine-alcohol combo.

UPDATED 11/17/10 1:47 p.m.

CHICAGO (CBS/AP) – The Chicago-based manufacturer of popular caffeinated alcohol drink Four Loko said Tuesday it will remove the caffeine from its products, pulling the blend off the market just as the Food and Drug Administration is poised to ban it.

Phusion Projects said in a statement posted on its website that the company will remove caffeine and two other ingredients from its products going forward.

Meanwhile Wednesday, the Food and Drug Administration announced that it has issued warning letters to four manufacturers of alcoholic energy drinks, saying the caffeine added to their beverages is an “unsafe food additive.”

FDA Deputy Commissioner Joshua Sharfstein said Wednesday that the agency has decided the combinations of caffeine and alcohol in the drinks is a public health concern after a yearlong review of the beverages. The FDA said the government could seize the products if the companies continue to make them.

The combination of caffeine and alcohol in the drinks creates a public health concern and can lead to “a state of wide-awake drunk,” said FDA Commissioner Margaret Hamburg. Evidence has shown their consumption has led to alcohol poisoning, car accidents and assaults, she said.

The FDA finding would essentially would ban Four Loko and other drinks like it.

The FDA ruling “should be the nail in the coffin of these dangerous and toxic drinks,” Sen. Chuck Schumer (D-N.Y.), who has pushed the Obama administration to ban the beverages, said Tuesday before the FDA announcement.

Four Loko’s statement suggests even before the FDA’s announcement, the company believed it had little choice but to reformulate its drinks.

The statement by the company’s three co-founders said they were removing caffeine from the drinks after unsuccessfully trying to deal with what they called “a difficult and politically-charged regulatory environment at both the state and federal levels.”

“We have repeatedly contended – and still believe, as do many people throughout the country – that the combination of alcohol and caffeine is safe,” said Chris Hunter, Jeff Wright and Jaisen Freeman, who identify themselves as Phusion’s three co-founders and current managing partners.

The company told CBS News in a statement earlier this month that the caffeine-alcohol combination was as safe as “having coffee after a meal with a couple of glasses of wine.”

Their latest statement did not mention several recent incidents in which college students were hospitalized after drinking the beverage. In response to such incidents, four states – Washington, Michigan, Utah and Oklahoma – have banned the beverages. Other states are considering similar action.

Four Loko comes in several varieties, including fruit punch and blue raspberry. A 23.5-ounce can sells for about $2.50 and has an alcohol content of 12 percent, comparable to four beers, according to the company’s website.

Little information is available about parent company Phusion Projects, which also does business as Drink Four. The company lists its address as 1658 N. Milwaukee Ave., which is the address of a UPS store. Its Web site says its founders were three college friends from Ohio State University, who “took out a Small Business Administration loan and put their financial resources on the line to launch Chicago-based Phusion Projects LLC.”

Thereis also is little known medical evidence that the drinks are less safe than other alcoholic drinks. But public health advocates say the drinks can make people feel more alert and able to handle tasks like driving. A Wake Forest University study found that students who combine caffeine and alcohol are more likely to suffer alcohol-related injuries than those drinking alcohol without caffeine.

Last year the FDA notified more than two dozen manufacturers of caffeinated alcoholic beverages that it never had specifically approved the addition of caffeine to alcoholic drinks and began studying whether it was unsafe and should be outlawed. The agency noted the mix’s growing popularity among college students and its potential health and safety issues.

The FDA said then it had not reached a conclusion about the drinks’ safety but cited concerns from several state attorneys general who contended the drinks appealed to underage drinkers and encouraged reckless behavior.

The Federal Trade Commission, which regulates the marketing of the drinks, declined to comment.

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