Episode 38: Coca Cola

Whether you hate it or love it, the Coca Cola Company has quite the back story.

Transcript

SPEAKER_00 0:02

Hey everybody, I'm Shannon, and welcome to the They Hid What Podcast. On this podcast, I explore parts of history that have been kept hidden or swept under the rug. In this week's episode, I will be discussing Coca-Cola. Let's get into it. A bunch of science, some business speak, a bunch of names I don't expect you to remember. But it's still interesting. So just, you know, get ready. Let's get going. John Pemberton was born on July 8th, 1831, in Knoxville, Georgia. And not much is known about his earlier years, which is kind of annoying for me. But by the age of 19, he earned his medical degree from Reform Medical College in Georgia. And this is Georgia of the United States, not Georgia, the country. John specialized in chemistry, and after practicing some medicine and surgery, he decided to open a drugstore. He also acquired a graduate degree in pharmacy sometime before 1860. In 1853, John married Ann Eliza Difford Lewis, and they had a son, Charles, in 1854. Then came the American Civil War. John served in the 3rd Cavalry Battalion of Georgia State Guard and made it to the rank of Lieutenant Colonel. In April 1865, during the Battle of Columbus, John sustained a saber wound to the chest, and he used morphine to manage the pain and soon became addicted. By 1866, John Pemberton wanted to find a substitute for morphine, and he began experimenting with painkillers in his pharmacy. His first recipe was called Dr. Tuggle's Compound Syrup of Globe Flour. The active ingredient is this compounded syrup that's derived from the buttonbush, which is a toxic plant, the bark of which was used for home remedies. As for John's recipe, he began experimenting with coca and coca wines and eventually landed on a recipe that had extracts of cola nut and damiana, which is a shrub, and he called his final concoction Pemberton's French wine coca. Now, let's break down each of these ingredients. A cola nut spelled with a K was used for caffeine and for flavoring, and each nut contains about 2 to 3.5% caffeine. Coca is any of four cultivated plants in the bear with me Erythroxylaceae family. Shut up. Coca is known for its psychoactive alkaloid, cocaine. Coca's leaves contain cocaine, which acts as a stimulant when chewed or consumed in tea. Coca wine is an alcoholic beverage that combines wine and cocaine. And lastly, the name French wine coca. French wine coca already existed. In 1863, a Corsican chemist named Angelo Mariani combined coca and wine and started selling it as vin Mariani. It was extremely popular and it said that many notable people drank it, including Pope Leo XIII. After seeing the success of that mixture, John Pemberton decided to make his own and marketed it as a cure. At this time, there was a lot of public concern about drug addiction, depression, and alcoholism among Civil War veterans. There was also concern of neurasthenia or a mechanical weakness of the nerves among quote-unquote highly strung Southern women. John Pemberton marketed his medicine as beneficial for, quote, ladies and all those whose sedentary employment causes nervous prostration. By 1886, Fulton County, Georgia enacted temperance legislation, which was a total abstinence of alcohol. John Pemberton now had to make a non-alcoholic version of his French wine coca. Working with the drugstore owner Willis E. Vanabel, Pemberton blended the base syrup of his drink with carbonated water by accident. And he decided to sell this as a fountain drink rather than as a medicine. Frank Mason, John Pemberton's bookkeeper, came up with the name Coca-Cola for the alliterative sound, which was popular among other wines and medicines at the time, I'm told. This name refers to the two main ingredients of the beverage, but because of controversy over its cocaine content, the Coca-Cola Company later said that the name was meaningless but fanciful. John made many health claims for his product, touting that as a valuable brain tonic that would cure headaches, relieve exhaustion, and calm nerves, and marketed it as a quote, delicious, refreshing, pure, joy, exhilarating, and invigorating. The first advertisement for the beverage was on May 29, 1886, in the Atlanta Journal. Now on to 1888, where things get a little confusing. Allegedly, on January 14, 1888, a co-partnership was formed between John Pemberton and four Atlanta businessmen, J.C. Mayfield, A. O. Murphy, C.O. Malale, and E. H. Bloodworth. J.C. Mayfield was under the impression that he had acquired the rights to Coca-Cola, the whole thing. But John Pemberton had sold the rights to manufacture Coca-Cola a second time that year to Asia Candler. J.C. Mayfield later reincorporated the Pemberton Medicine Company in 1894 as the Wine Coa Company and attempted to sell Coca-Cola under the name Pemberton's French Wine Coca, but had modified the formula to resemble Coke. John Pemberton was able to sell the rights to manufacture two times because the first partnership was never put into an official signed document. And Asia Candler realized this and said that he had acquired stake in the company as early as 1887. John Pemberton said that the name Coca-Cola belongs to his son, Charlie, but that the other two manufacturers, Asia Candler and Walker and Sozier, could continue to sell the formula. Okay? So John has this product, this Pemberton Coca-Cola. He's now calling it Coca-Cola. He's given the rights to the name only to his son and the manufacturing of the formula to two other people. In March of 88, so this is only within a very short period of time. Charlie Pemberton reincorporated the Coca-Cola Company in the place of his father. Charlie held the name Coca-Cola, but Walker and Sozier held one-third interest of the company, and Candler and Company held two-thirds interest in the company. It's so headache-inducing. Candler owns the recipe for the beverage, but Charlie Pemberton owns the name. Around this time, John Pemberton is sick and nearly bankrupt. He began selling the rights to his formula to his business partners in Atlanta. And part of what motivated him to sell was that he was still spending a lot of money on his morphine habit. Yeah, that never went away. John considered hanging on to a share of the company to pass on to Charlie, but Charlie wanted the money. So in 1888, John and Charlie Pemberton sold the remaining portion of the patent to Asia Candler for$3,000. In April of 1888, Asia sells the beverage as Yum Yum and Coke with a K. At this same time, Charlie Pemberton was selling a more crude version under the name Coca-Cola. On August 16, 1888, John Pemberton dies of stomach cancer at 57. At this point, Charlie Pemberton is 34 years old, an alcoholic, and an opium addict. Aja Candler wanted to act quickly to purchase the exclusive rights to the name Coca-Cola. This way he would have the formula and the name. In Charles Howard Candler's 1950 book about his dad, he stated, quote, on August 30th, 1888, he, his dad, became the sole proprietor of Coca-Cola, a fact which was stated on letterheads, invoice blanks, and advertising copy. End quote. Candler's sole control became technically all true. Candler had negotiated with Margaret Dozier and his brother Wolfolk Walker a full payment amounting to$1,000, which they all agreed Candler could pay back with a series of notes over a period of time. By May 1st, 1889, Candler was claiming full ownership of the Coca-Cola beverage. In 1892, Asia Candler set out to incorporate a second company and advertised Coca-Cola as a drink that relieved mental and physical fatigue and that cured headaches. And in 1893, Asia trademarked the brand. Okay, so by 1883, we now have the name Coca-Cola, the formula for the drink, all under one brand name with one owner. On March 12, 1894, Coca-Cola is first bottled in Vicksburg, Mississippi at the Biden Ham Candy Company. The original bottles were Hutchinson bottles, which used a bent wire that was attached to some like rubber seal and it kind of acted like a cork. I'm not good explaining it, but you've seen one of these before. On June 23rd, Charlie Pemberton was found unconscious with a stick of opium by his side, and 10 days later, he died at Atlanta's Grady Hospital at the age of 40. By 1895, Coca-Cola is being distributed nationwide, and in 1899, they began exporting to Cuba. Around this time, Asia Candler signed a bottling contract with two entrepreneurs from Tennessee, allegedly for one dollar, and Chattanooga became the site of the first Coca-Cola bottling company. Asia Candler thought he was just selling the syrup to the bottling company, but apparently the contract that was signed was very vague and led to a lot of problems for Candler. Also, the bottlers in Chattanooga subcontracted to other companies and became parent bottlers. So under this subcontractor contract, the bottles would be sold at 5 cents each and led to a fixed price for Coca-Cola from 1886 to 1959. Also, it was said that Candler never got his$1 from the initial bottling contract. The Coca-Cola Company saw a lot of action in the 1900s. The cola syrup was being sold as an over-the-counter dietary supplement for upset stomach. In 1901, the drink was being exported to Europe, and in 1903, Candler decided to remove the cocaine component from the Cocoa leaves before mixing them with the drink. He sold the extracted cocaine to pharmaceutical companies. The chief chemist of the U.S. Department of Agriculture, Dr. Harvey Wiley, declared that soft drinks containing the alkaloid caffeine compound were habit-forming and nerve-wracking. There were other medicated soft drinks sold to the public at that time, many with names like Coca Coke and Coke, all with Ks. Others like Seven Up contained lithium, and others, like Coke in the 20th century, contained a high level of caffeine, and these drinks were marketed not just to adults, but to kids as well. Harvey Wiley felt it was very important that consumers knew exactly what was in their food and what was going into a consumer's body. Earlier on, he viewed sacral, an artificial sweetener derived from coal tar, which is a liquid byproduct of the actual rock coal, as an illegal substitution of sugar, and told then-President Theodore Roosevelt, quote, everyone who ate that sweet corn was deceived. He thought he was eating sugar, when in point of fact, he was eating a coal tar byproduct, totally devoid of food value and extremely injurious to health. Part of this lawsuit was a study conducted by Harry Hollenworth. This study lasted for 40 days and had 16 participants, 10 men, 6 women. The subjects received daily capsules that contained a placebo caffeine or Coca-Cola syrup in a range of doses. The study was double blind, meaning that neither the test subjects nor the scientists knew who had received what until after the tests were completed. The Hollenworth test for speed of reaction, steadiness, coordination, and mental acuity. Examples of mental acuity later included color recognition, word opposite tests, math calculations, and speed of discrimination. By the time they were done, Hollenworth had 64,000 data points, which he presented to the slightly stunned Tennessee jury through a series of graphs and charts. Hollenworth reported on an increased capacity clearly related to caffeine. It was, Hollenworth said, rapidly and temporarily uplifting, and its predominant effect seemed to be quicker mental reactions and finer motor coordination. The judge dismissed the case on a technicality. A new argument from the company that caffeine was a naturally occurring ingredient rather than an additive, as USDA claimed, and therefore could not be challenged under federal law. In 1916, the U.S. Supreme Court reversed the finding and declared caffeine to be an additive under the law. Shortly after, Coca-Cola settled the case by agreeing to pay all court costs and by cutting the amount of caffeine in its drink by half. All right, so by 1916-ish, Coca-Cola now doesn't have any cocaine in it, and its caffeine content has been cut by 50%. All right. In 1919, Asia Chandler gave most of his stock in the company to his five children. The kids sold their shares, and on September 12th, 1919, Coca-Cola Company was purchased by a group of investors led by Ernest Woodruff's Trust Company for$25 million and reincorporated under the Delaware General Corporation Law. 1935, Coca-Cola was certified kosher by Atlanta rabbi Tobias Geffen. With the help of Harold Hirsch, Geffen was the first person outside of the Coca-Cola Company to see the top secret ingredients list after the company faced scrutiny from the American Jewish population regarding the drink's kosher status. Consequently, the company made minor changes in the sourcing of some ingredients so it could continue to be consumed by American Jewish populations, including during Passover. And a yellow cap on a Coca-Cola drink indicates that it is kosher for Passover. I had no idea they had kosher status, so that was a fun little nugget. By 1941, Coca-Cola Company finally embraced the name Coke, and it became a registered trademark in 1945. But before that, in 1944, the one billionth gallon of Coca-Cola syrup was manufactured by the company. However, in the 70s, the price of sugar spiked. The Soviet Union was the largest producer of sugar and they jacked up the prices due to demand. In 1974, Coca-Cola switched to using high fructose corn syrup to help keep costs low. Now that was only in the States. The Coca-Cola being manufactured and sold in Mexico was able to have pure cane sugar. That's why when people from the States try Coke from Mexico, they think it's way too sweet. Things were going well until April 23rd, 1985, when the company changed their formula and created new Coke. Responses differed. Consumers preferred the new Coke taste over old Coke and Pepsi, but people liked the nostalgia of the old Coke taste. By July 10th, Coca-Cola Classic used the old formula while new Coke was still available and was renamed to Coke 2 in 1992. It was discontinued in 2002. In 2006, there was a little bit of drama for the Coca-Cola Company. Joya Williams, a secretary to Coca-Cola's global brand director, conspired to sell the formula. Allegedly, Joya, along with her accomplices, Ibrahim Dimson and Edmund Dehaney, conspired to sell the confidential trade secret to Pepsi Cola for$1.5 million. That hardly seems enough to me. However, Pepsi reported the illegal offer to Coca-Cola and to the FBI. The FBI conducted a sting operation posing as Pepsi executives, leading to the arrest of Williams and her accomplices. Public prosecutor David Namas praised Pepsi for doing the right thing. He says, quote, they did so because trade secrets are important to everybody in the business community. They realize that if their trade secrets are violated, they all suffer. The market suffers and the community suffers. Coca-Cola sells 1.9 billion servings of their drink daily and 700 billion annually. The total number of Coke variations are unknown. Beyond the core flavors, which are regular diet, cherry, vanilla, and zero sugar, there have also been limited edition flavors and regional varieties. Whether you like Coke or not, the company has been around since before we were born and is a globally recognized brand. And I hope today you learned a little something about that good old fashioned Coca Cola. Come back next week to see what else has been hidden.