The Food and Drug Administration (FDA) in the United States said it was investigating reports of five deaths that may be associated with Monster Beverage Corp's namesake energy drink as the company's shares fell more than 14 percent.
Monster is also being sued by the family of a 14-year-old girl from Marlyland in the US with a heart condition who died after drinking two cans of its Monster energy drink in a 24-hour period.
Monster said it does not believe its drinks are "in any way responsible" for the girl's death.
The energy drink market is dominated by Monster and Austrian company Red Bull, but it also includes beverages made by Coca-Cola Co and PepsiCo.
The lawsuit and reports of other deaths that may be associated with energy drinks illustrate safety concerns surrounding the highly caffeinated beverages that are especially popular with young people. They could also embolden the industry's critics, including two senators in the US and the New York attorney general.
"I don't think they are going to ban energy drinks," said Morningstar analyst Thomas Mullarkey. "The question arises whether or not it gives them more firepower for increased regulation."
That could mean more extensive labeling requirements or age restrictions, Mullarkey said. He added that the negative headlines also made Monster a less attractive takeover target.
"This really reduces the likelihood that Coke would want to acquire Monster," Mullarkey said.
Sources told Reuters in April that the two companies had discussed a possible deal as recently as last year.