Abbott Labs Under Criminal Investigation over Baby Formula Shortage, Company Says

Major baby formula company Abbott Labs is under criminal investigation by U.S. authorities over its conduct related to the formula shortage, according to reports.

The U.S. Department of Justice (DOJ) is probing the matter, a spokesperson for the company told news outlets.

“DOJ has informed us of its investigation and we’re cooperating fully,” the spokesperson said.

Abbott is one of the largest baby formula manufacturers in the country.

It issued a voluntary recall in February 2022 after the U.S. Food and Drug Administration (FDA) warned Americans not to use some products made at one of the company’s plants in Sturgis, Michigan.

An investigation uncovered unsanitary conditions there following a whistleblower complaint.

Dr. Robert Califf, the Food and Drug Administration commissioner, said during a congressional hearing that the investigation results “were shocking,” describing conditions he said were “egregiously unsanitary.”

Regulators discovered the presence of Cronobacter sakazakii, a bacteria that can contaminate dry products like infant formula powder, at the facility.

The U.S. Centers for Disease Control and Prevention opened a probe into multiple cases, including several deaths, potentially linked to the contamination.

Authorities said they were unable to find a definitive connection between the illnesses and Abbott’s products.

Abbott has said that none of the formula it distributed tested positive for Cronobacter.

The Federal Food, Drug, and Cosmetic Act of 1938 prohibits “adulterated food,” or food that “contains any poisonous or deleterious substance which may render it injurious to health,” with some exceptions.

People or companies that enter adulterated food into “interstate commerce “can be prosecuted under the law.

Examples of interstate commerce include selling a product, shipping it to another state, or contracting with another company or person to ship the good to another state.

The plant shutdown lead to baby formula shortages that plagued new parents for months.

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The Sturgis plant reopened in mid-2022 after U.S. authorities and Abbott agreed to a plan outlining steps that the company needed to take to correct deficiencies.

“We understand the urgent need for formula and our top priority is getting high-quality, safe formula into the hands of families across America,” Abbott said as the plant reopened.

“We will ramp production as quickly as we can, while meeting all requirements.

“We’re committed to safety and quality and will do everything we can to re-earn the trust parents, caregivers and health care providers have placed in us for 130 years.”

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By Nick R. Hamilton

Nick has a broad background in journalism, business, and technology. He covers news on cryptocurrency, traditional assets, and economic markets.

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