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Sept. 25, 2022, 12:34 p.m. EDT

‘If the FDA is expected to do more, it needs more’: FDA investigation into baby-formula crisis points to its own shortcomings. But shortages persist.

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By Quentin Fottrell

The Food and Drug Administration spent months probing the nationwide shortage in baby formula, and conducted 40 interviews with more than 60 of its staff and leadership. As shortages still persist in some states, the agency found five major areas of improvement. 

“Although the limitations uncovered in our evaluation were magnified by the nature of infant formula as the sole source of nutrition for vulnerable populations, the lessons learned can be applied across the entire FDA portfolio,” Steven Solomon, director of the federal agency’s Center for Veterinary Medicine, said in his review .

“The report also identifies several areas in which the FDA lacks specific authorities and resources. Simply put, if the FDA is expected to do more, it needs more,” he added.

Supply-chain disruptions and product recalls from Abbott Laboratories /zigman2/quotes/203724446/composite ABT +0.15% in February due to contamination concerns contributed to a nationwide baby formula shortage. Abbott is the biggest supplier of infant formula in the U.S.

The shortage continues in some areas of the country . Stores were stocking approximately 81% of their normal levels of baby formula for the week ending Sept. 11, according to market-research group IRI, up from 69% in July.

Solomon outlined five lessons to be learned from the formula crisis: 

  • “Modern information technology that allows for the access and exchange of data in real time to all the people involved in response.”

  • “Sufficient staffing, training, equipment and regulatory authorities to fulfill the FDA’s mission.”

  • “Updated emergency response systems that are capable of handling multiple public health emergencies occurring simultaneously.”

  • “Increased scientific understanding about Cronobacter , its prevalence and natural habitat, and how this translates into appropriate control measures and oversight.”

  • “Assessment of the infant formula industry, its preventive controls, food safety culture and preparedness to respond to events.”

“The report focuses on aspects of the response that are within the agency’s purview: other factors, including the limited number of infant formula manufacturers, needed improvements in the ingredient supply chain, and better control of product distribution, must be addressed by other external stakeholders,” Solomon said in a statement this week.

The shortage also disproportionately hit lower-income mothers , as Abbott’s Similac was the main formula brand in many states for the government’s Special Supplemental Nutrition Program for Women, Infants, and Children (WIC). 

The United States Department of Agriculture’s WIC covers more than 1.2 million infants who collectively consume 56% of formula nationwide, and provides monthly benefits to lower-income moms to buy baby formula, nutritious food and groceries.

Abbott resumed part of its formula production in July, including some of the specialty formula products that were hard to find during the peak of the shortage. It pledged to supply the U.S. with more than 8 million pounds of formula in August, more than what the company produced in August 2021. 

A spokesperson for Abbott told MarketWatch: “We know the infant formula shortage has been difficult on families and caregivers.”

This week, the company started shipping EleCare formula products to medical suppliers, pharmacies, retailers, hospitals, and doctor’s offices, the spokesperson said, “and expect it to be more readily available in the next two to four weeks as it works its way through distribution channels.”

Abbott also restarted Similac infant formula production at the company’s Sturgis, Mich., facility.

“Since our voluntary recall in February, investigations conducted by the U.S. Food and Drug Administration, the Centers for Disease Control and Prevention and Abbott, including genetic sequencing, retained product samples and available product from the four complaints, did not find any definitive link between the company’s products and illnesses in children,” the spokesperson said.

“For 90 years, we’ve been supplying families with the safe, high-quality infant formula they need and can trust,” the spokesperson added. “We meet and exceed regulatory requirements for infant-formula testing.”

Together with the U.S. Department of Agriculture, Abbott offered to cover the costs for WIC programs to find alternative formulas. Abbott, Mead Johnson Nutrition — owned by Reckitt /zigman2/quotes/204605475/composite RBGPF -0.30% —Perrigo /zigman2/quotes/201110862/composite PRGO -0.62% and Nestlé USA /zigman2/quotes/210131093/composite NSRGY -0.25% are the four major players in the baby-formula market in the U.S. 

(Zoe Han contributed to this story.)

/zigman2/quotes/203724446/composite
US : U.S.: NYSE
$ 108.09
+0.16 +0.15%
Volume: 4.94M
Dec. 2, 2022 4:03p
P/E Ratio
24.38
Dividend Yield
1.74%
Market Cap
$188.18 billion
Rev. per Employee
$398,496
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/zigman2/quotes/204605475/composite
US : U.S.: OTC
$ 72.21
-0.22 -0.30%
Volume: 4,120
Dec. 2, 2022 3:46p
P/E Ratio
12.75
Dividend Yield
N/A
Market Cap
$53.01 billion
Rev. per Employee
$343,590
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/zigman2/quotes/201110862/composite
US : U.S.: NYSE
$ 31.94
-0.20 -0.62%
Volume: 942,132
Dec. 2, 2022 4:00p
P/E Ratio
N/A
Dividend Yield
3.26%
Market Cap
$4.33 billion
Rev. per Employee
$444,525
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/zigman2/quotes/210131093/composite
US : U.S.: OTC
$ 120.32
-0.30 -0.25%
Volume: 2.13M
Dec. 2, 2022 3:59p
P/E Ratio
19.06
Dividend Yield
2.14%
Market Cap
$326.28 billion
Rev. per Employee
$353,364
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