On September 14, 2026, Abbott Laboratories (“Abbott”) agreed to a settlement to pay $348,700,868 to the U.S. to resolve the False Claims Act allegations, and to pay $35,491,288 to U.S. states for claims relating to their Medicaid programs.
According to the settlement, “the federal and state governments allege 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. Specifically, Abbott allegedly failed to maintain its manufacturing equipment, failed to control the presence of water that put the products at increased risk of microorganism contamination, and, in certain instances, failed to disclose test results indicating the presence of microorganism contamination when responding to requests from the U.S. Food and Drug Administration during 2019 and 2022 inspections at the Sturgis facility.” The lawsuit posited that Abbott’s misrepresentations allegedly caused the WIC program and state Medicaid programs to purchase powder infant formula and nutritional products manufactured at these facilities despite the products’ failure to meet statutory, regulatory, and contractual requirements.
According to Connecticut Attorney General, William Tong, “There are few things more sensitive than the safety of infant formula. For years, Abbott produced infant formula in inadequate facilities that significantly imperiled the reliability, safety and quality of its formula. And when those failures led to contamination, they failed to disclose it.”
In 2022, the FDA launched an official inspection of the Sturgis manufacturing facility and confirmed the presence of Cronobacter sakazakii bacteria. Shortly thereafter, Abbott announced a voluntary recall of several of its infant formula products, only after four infant illnesses and one infant death were linked to the bacteria. A handful of days after the Sturgis plant closed down, the FDA reported a second infant death.
These events led to the Spring of 2022, when the closure of the country’s largest infant formula plant triggered a severe nationwide baby formula shortage, peaking with out-of-stock rates exceeding 70% in May.
As seen in years since 2022, infant formula contamination crises continue to plague the U.S. and some global markets – reiterating the need for mandatory, third-party testing, regulations and reporting mechanisms to be implemented. The World Health Organization’s (WHO) Code of Marketing of Breast-milk Substitutes and subsequent World Health Assembly (WHA) resolutions serves as a promising place for the U.S. to begin its work on this critical issue.