Remember when baby formula was scarce across the United States? That wasn’t too long ago, right? In fact, store chains like Walmart and Target still have shelves almost entirely empty.
According to Wall Street Journal reports on Wednesday, The U.S. Federal Trade Commission is investigating whether baby-formula makers colluded on bids for “attractive” state contracts.
Documents reported from the WSJ show that Abbot Laboratories and other formula manufacturers have “engaged in collusion or coordination with any other market participant regarding the bidding” for state contracts.
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The FTC had requested information from Abbot back in January as a part of its investigation into companies bidding for state infant-formula supply contracts.
In February, Abbot said it received a civil investigative demand from the FTC related to a probe of the companies participating in bids for WIC formula contracts. Initially, Abbott’s lawyers denied any knowledge of collusion or coordination, expressing confusion regarding the factual basis of the agency’s investigation.
Nestle and Reckitt Benckiser Group were amongst other companies willing to comply with regulatory and enforcement agencies’ requests. Nestle, which makes the Good Start line of infant formulas, did not comment further.
The FTC declined to provide further details as well, labeling them as nonpublic, the investigation being just one amongst several initiated by federal agencies against Abbott, including a criminal investigation by the Justice Department prompted by the closure of one of Abbott’s manufacturing plants last year, which contributed to the nationwide formula shortage.
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