Abbott Laboratories has agreed to pay $385 million to settle claims related to an investigation and lawsuit brought by the Justice Department concerning its manufacturing and the 2022 recall of powdered infant formula at its Sturgis, Michigan facility, the largest baby formula plant in the U.S.
The settlement also covers lawsuits filed by certain relators and the Attorneys General of several states. Abbott stated that the settlement does not represent any finding of fault or liability on its part.
Problems at the Sturgis plant led to a recall of several infant formula brands, including Similac, which exacerbated existing supply chain disruptions and inventory shortages that had been strained during the COVID-19 pandemic. The Justice Department initiated its criminal investigation under the Trump administration, which was later closed. The Biden administration took steps to address the shortage by easing import rules for foreign manufacturers, airlifting formula from Europe, and invoking federal emergency rules to prioritize U.S. production.
Abbott closed the Sturgis facility in February 2022 following an investigation by the Food and Drug Administration. The plant resumed operations by June of the same year. Abbott has noted that tests conducted by government regulators on unopened product samples from infants involved in the 2022 recall were negative for Cronobacter sakazakii, a bacterium that can cause illness in infants. The company also stated that no unopened, distributed Abbott infant formulas have ever tested positive for this bacterium.