The prize was bogus to begin with, as explained in this Slate article from 2008
. In short, it wouldn't be paid out unless the contestant was selling a ton of the stuff in stores and restaurants across 10 states over three months... at the same price as real chicken.
Science prizes are supposed to encourage development of things not yet commercially viable; this was a phony small tip for someone already successful. "Phony", because even if someone had the breakthrough needed on the day after this was announced, there's no way in hell that it could be approved for use and on market shelves in time to meet even the extended deadline.
there were the contest requirements, including full disclosure of ingredients and methods (trade secrets), carte blanche use of any- and everything related for PeTA's promotional purposes, rules subject to change without notice, and so on.
This was never a serious offer, just serious marketing, something PeTA mastered long ago. This "prize" retraction just got them some more free air time and, no doubt, some new members & donations... saith an older and hopefully wiser former member & supporter.