"Made with real cane sugar, instead of that high fructose corn syrup stuff."
— "You" when examining it.

Kenny gives it to you if you try to give him the Cat Plush on a New Game + playthrough. This item is only available in The Director's Cut.

You can create an upgraded version of it towards the very end of the game after completing the Cat Key sidequest and using it with the strange canister to create Chilled Mexican Cola.