Abbott to pay $385 million to settle DOJ baby formula lawsuit
Abbott Laboratories will pay $385 million to settle a Justice Department lawsuit over a Michigan manufacturing plant tied to contaminated powdered baby formula. The settlement ends a civil complaint alleging the company knowingly produced infant formula under conditions that put products at risk of microorganism contamination.
Acting Deputy Attorney General Trent McCotter said the settlement “makes clear the safety of our children is not negotiable.”
The Justice Department had been considering criminal charges against the company, The Wall Street Journal reported, until the Trump administration closed the investigation in favor of a civil penalty.
Contamination led to the nation’s largest formula facility being shuttered temporarily in 2022, triggering a recall of several infant formula brands, including Similac, and causing a nationwide shortage.
The products were purchased with government funds under the Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) program administered by the U.S. Department of Agriculture, which pays for more than fifty percent of all infant formula sold in the United States.
The Food and Drug Administration launched an inspection of the plant amid complaints that four infants had been hospitalized with rare bacterial infections after consuming powdered formula made in the facility. Two infants died from the infections.
The inspection found unsanitary conditions and multiple strains of a bacteria that can be deadly to infants. The facility was shuttered in February 2022 and reopened in June of that year.
The Justice Department’s complaint detailed those unsanitary conditions, including installing umbrellas to deal with roof leaks, which diverted water from production areas but created a wet environment ripe for bacterial growth.
The complaint also alleged that the company “intentionally did not test for bacterial growth to avoid obtaining positive test results showing contamination,” and that in certain instances where testing demonstrated micro contamination, Abbott failed to disclose the test results when responding to requests from the FDA during 2019 and 2022 inspections.
Under the settlement, Abbott did not admit liability or fault. The company maintained there is no evidence that its formula caused the illnesses or deaths that prompted the 2022 recall.
The company said testing and genetic sequencing did not identify a connection between Abbott formula and the reported illnesses, which were caused by the bacterium Cronobacter sakazakii. The company also said no unopened, distributed Abbott infant formulas have ever tested positive for Cronobacter sakazakii.
Nearly $349 million of the settlement funds will go to the federal government and just over $36 million will go to state Medicaid and WIC programs that purchased Abbott’s formula.
Three whistleblowers who first filed complaints about the plant will receive $69 million.
