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Pepsi Reels From Reports Of Product Tampering

Soft-drink giant says incidents are most likely cases of `copycat hoax'

FOOD tampering or hoax?

That is the question facing officials of Pepsico Inc., Pepsi Cola's parent company, following numerous complaints across the country that syringes, needles, and other objects have been found in its canned soda products.

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A number of cases have been confirmed as hoaxes. Pepsico officials say eventually all of the tampering cases will presumably turn out to be hoaxes by people trying to cash in on the company's misfortune. Alleged findings of needles in Pepsi cans have been reported from at least 24 states in all regions of the United States.

The reports of tampering - or copycat hoaxes - come at a bad time for Pepsico, and soft-drink makers in general, since Americans buy the product in large quantities during the summer months.

Pepsiso officials, inundated with calls at their Purchase, N.Y., headquarters, say they are taking the allegations seriously and are determined to do whatever is necessary to protect consumers. But they have declined to recall any Pepsi products, since, at press time, no case of a syringe in an unopened can has been found, says Brad Shaw, a company spokesman.

Past cases of actual or alleged food tampering have cost American industry hundreds of millions of dollars from lost sales and the expense of having to devise new tamper-proof containers. Corporate reputations have also suffered. In 1982, seven people died in the Chicago area after swallowing Tylenol capsules laced with cyanide. Last week in the Seattle area, a man was convicted of attempting to murder his wife by lacing a cold capsule with poison. The first two reports of Pepsi tamperings also came from

around Seattle last week.

Most reports involving food tampering are unsubstantiated, says Betsy Adams, a spokeswoman for the Food and Drug Administration in Washington. In 1984, for example, the FDA examined nearly 500 reports of food tampering involving Girl Scout cookies; no proof was ever found.

"Everything about this [series of incidents] is very strange," Ms. Adams says. No food container is completely tamper-proof, she admits, but a "can is about as close as you can come."

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All 70 special agents of the FDA's office of criminal investigations are working on the Pepsi case, Adams says. "We are advising people that they should pour their cans of soda into a glass before consuming them," says FDA spokeswoman Monica Revelle.

A man was arrested in Williamsport, Pa., accused of taking a needle from the trash and claiming it came from a Pepsi can. Another man was arrested in Branson, Mo. Conviction for such crimes can carry a minimum fine of $250,000 and a prison sentence of up to 5 years.

Pepsi officials say it is almost physically impossible for tampering to have occurred during the production process. The company has about 140 plants throughout the US, Pepsi spokesman Mr. Shaw says, and bottling methods are fairly uniform.

About 1,600 cans a minute move down the conveyor belt. They are open at the top, but are automatically flipped upside down before being filled and rotated rightside up. Therefore, they are empty at the moment the soda is poured into the container. Within seconds, a lid is sealed on top.

Americans, who buy between 20 million and 30 million cans of Pepsi a day, have made Pepsico Inc. one of the most successful food companies in the world, says William Leach, a food analyst with Donaldson, Lufkin & Jenrette Inc., an investment house. At press time, only one reported incident has involved another soft-drink maker, Coca Cola. That case was determined to have been a hoax.

Although Pepsico and Coca Cola, headquartered in Atlanta, are the two largest US soft-drink manufacturers, they are quite different, Mr. Leach says. Pepsi is a "diversified food producer." Coca Cola is primarily a beverage producer; only 20 percent of its earnings come from the US, he says.

Pepsico's stock fell slightly this week - share prices dropping almost $1 - apparently because of the allegations of tampering. Shares are selling in the $35 range, below a high of $43 recorded in the past 12 months.

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