Alcohol confined to labs, in theory (8)
I believe the answer is:
absinthe
'alcohol' is the definition.
(absinthe is a kind of alcohol)
'confined to labs in theory' is the wordplay.
'confined to' indicates the answer is hidden within the clue (the answer is confined in the clue).
'ABSINTHE' is hidden in the letters of 'labs in theory'.
(Other definitions for absinthe that I've seen before include "Bathes in strong liquour, strangely" , "Strong green alcoholic drink" , "Green wormwood drink" , "Potent aniseed-flavoured drink" , "Green aniseed liqueur" .)