The paper says that Pepsi has developed a flavored milk drink that it may begin testing in stores next year. It has already run trials in school vending machines. Quaker Milk Chillers are made with 52% low-fat milk and come in chocolate, vanilla and strawberry.

"It's in keeping with our plan to offer more ‘better for you' choices," said Dave DeCecco, a spokesman for PepsiCo, which also owns Texas-based snack food maker Frito-Lay Inc.

Milk Chillers will join rival Atlanta-based The Coca-Cola Co.'s Swerve, and Plant,Texas-based Dr. Pepper/7-Up Inc.'s Raging Cow as the latest efforts from both soft drink companies to tap into milk in addressing consumers' growing concern about health and nutrition.