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According to Ad Age, the soda giant is working with the biotech company Senomyx to produce a "taste modifier" that would essentially tell your taste buds they are receiving more sugar than they actually are.
Though the taste modifier ingredient is still awaiting regulatory approval, Senomyx chairman and CEO Kent Snyder estimated in a conference call with investors that it would allow beverage makers to reduce sugar by up to 50% without losing any sweetness.
Known as "S617," the ingredient works by binding to the receptor cells in taste buds to trigger the sensation of sweetness that people receive when they taste sugar or high-fructose corn syrup.
S617 could be a massive boost to Pepsi as it tries to cater to an increasingly health-conscious consumer base, without losing the tasty flavor that compels people to reach for soda in the first place.
U.S. soda consumption has decreased in each of the past eight years, and Pepsi's most recent quarter was so bad that it wouldn't even say how far its U.S. soda sales fell (only reporting that the drop in volume sold was in the "mid-single digits").
Pepsi entered into a $30-million, four-year deal with Senomyx in 2010, agreeing to provide an additional $32 million in research and development payments.
In the event that Senomyx is able to get regulatory approval of S617, it remains to be seen whether consumers wary of artificial sweeteners will take to it. Though Senomyx says its taste modifiers are made from natural components, it's possible some consumers will still be turned off by S617 because it is made in a lab.