Abbott Laboratories announced it will pay $385 million to resolve claims stemming from an investigation into contamination at its manufacturing facility in Sturgis, Michigan, the nation’s largest baby formula plant. The settlement addresses a lawsuit filed by the Justice Department as well as legal actions brought by certain relators and state attorneys general.
The contamination issues at the facility led to a significant recall in 2022 affecting multiple infant formula brands, including Similac. The recall exacerbated existing supply chain pressures that had been intensified by pandemic-related disruptions and consumer stockpiling. Abbott stated that the settlement does not constitute an admission of fault or liability on the company’s part.
According to Abbott, government regulatory testing of unopened products from homes of affected infants during the 2022 recall returned negative results for Cronobacter sakazakii, a bacterium capable of causing illness in infants. The company further asserted that no unopened, distributed Abbott infant formulas have tested positive for this bacterium. The Justice Department’s criminal investigation into the matter was subsequently closed.
The facility was shut down in February 2022 following an FDA investigation and resumed operations by June of that year. During the shortage period, the Biden administration implemented various measures to address supply constraints, including modifying import regulations for foreign manufacturers, arranging airlifts of formula from Europe, and utilizing federal emergency provisions to support domestic production.
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