The papery off-flavor occurs when beer is oxidized.  It can also present itself as a cardboard flavor or even as a sweet stone fruit flavor.

How does it form in beer?

The major compound that causes the oxidized flavor is trans-2-nonenal (pictured above).  This flavor is typically formed in packaging when stored at elevated temperatures (above 40 F) for any period of time due to the typically higher amount of dissolved oxygen present in beer after packaging.

How do you solve the problem?

It’s very hard to remove all oxygen from beer – especially during packaging.  Typically, brewers and packaging line operators need to audit their processes and make sure that oxygen inclusion is minimal.  The easiest and most important way to stave off oxidation is the proper storage of beer at cold temperatures.  Oxidation is a thermodynamically-driven process and temperature plays a critical role in the shelf-life of your beer.  Keep your beer cold and it’ll last longer – a 2-4x decrease in freshness is seen for every 10°C/18°F increase in storage temperature.

Unsaturated fatty acids from malt, in the mash can also react with oxygen to form carbonyls, which are oxidized flavor compounds. Normally, these carbonyls will bind with proteins during the boil, and not be a huge issue, but further oxidation can result in breaking of these bonds and an increase in carbonyls and oxidation flavors in the beer.