Abbott under investigation by SEC and FTC for infant formula trade

Abbott under investigation by SEC and FTC for infant formula trade

Abbott said they are cooperating with government investigations.

Abbott is under investigation by the Securities and Exchange Commission, as well as the Federal Trade Commission, regarding their infant formula business, the company disclosed in a new SEC filing.

Abbott said in a filing on Friday that they received a subpoena from the SEC’s Enforcement Division in December 2022 requesting “information about its powdered infant formula business and related public disclosures “.

In January, Abbott “received a Civil Inquiry Request” from the FTC requesting information as part of the agency’s investigation into companies bidding for infant formula contracts with the federal Special Supplemental Nutrition program. Program for Women, Infants, and Children (WIC) through USDA. .

Abbott’s disclosure of those investigations comes after the Justice Department has already launched a criminal investigation into Abbott’s infant formula manufacturing conduct, a source familiar with the matter told ABC News, after concerns about contamination triggered a massive recall and the closure of their Sturgis, Michigan plant in the past year.

A spokesperson for Abbott told ABC News they are “cooperating with government investigations.”

An FTC spokesperson declined to comment to ABC News on Saturday.

ABC News has also contacted the SEC for comment and has yet to receive a response.

The discovery of Cronobacter sakazakii bacteria inside Abbott’s Sturgis plant prompted a massive recall of voluntary formula last February, after four babies who consumed Abbott’s formula contracted a Cronobacter infection. . Two of the infants later died, although Abbott maintains there was no conclusive evidence that his formula caused the childhood illnesses, as none of the strains of Cronobacter found in their factory matched the two samples. genetically sequenced sick infants.

Ultimately, it was the combined findings of Cronobacter inside the Abbott plant — along with operational shortcomings identified by federal investigators and consumer complaints — that led to the plant’s closure. .

After inspecting Abbott’s facilities in Sturgis last year, FDA chief Dr. Robert Califf described the investigators as “shocking” and “extremely unsanitary.”

“Standing water; cracks in key equipment that have the potential for bacterial contamination to persist, especially in the presence of moisture; roof leaks; previous citation for inadequate hand washing,” said Califf told Congress in May. “Many signs of a disappointing lack of attention to the culture of safety, in this product so essential to the lives of our most precious people.”

Abbott’s recall ricocheted off American grocery stores and family pantries, exacerbating an already growing supply problem and forcing families to scramble to get what their babies needed for months.

At the height of the severe shortage last May, the FTC had already launched a formula crisis investigation, probing potential unfair and illicit companies that could exploit the desperation of parents amid the crisis.

News of the latest Abbott investigations also comes on the heels of recent analysis by health experts who have exposed major formula companies, including Abbott, for “exploitative” marketing practices and aggressive lobbying.

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