Abbott agrees to settle DOJ lawsuit over baby formula plant contamination

Abbott Laboratories will pay $385 million to settle allegation related to how it operated a manufacturing plant tied to contaminated powdered baby formula suspected of causing infant deaths.

Contamination led to the nation’s largest formula facility being shuttered temporarily in 2022, triggering a recall of several infant formula brands, including Similac, exacerbating existing supply chain difficulties 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 settlement “makes clear the safety of our children is not negotiable,” acting Deputy Attorney General Trent McCotter said in a statement.

The Justice Department (DOJ) 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.

The civil complaint from the DOJ alleges that Abbott knowingly manufactured infant formula purchased with taxpayer dollars “in an environment that put the products at unacceptable risk of microorganism contamination and significantly impacted the products’ reliability, quality, and safety.”

The Food and Drug Administration (FDA) launched an inspection of the plant amid complaints that four infants had been hospitalized with rare bacterial infections after consuming powdered formula that was 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.

Similarly, the complaint alleged that Abbott “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 FDA during 2019 and 2022 inspections.

Under the settlement, Abbott didn’t admit liability or fault. The company in a statement 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 that no unopened, distributed Abbott infant formulas have ever tested positive for Cronobacter sakazakii.

Nearly $349 million of the Abbott 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.