Tuesday, June 6, 2023
HomeBusinessBaby formula makers target of FTC collusion probe

Baby formula makers target of FTC collusion probe

The Federal Commerce Fee is investigating whether or not Abbott Laboratories and different child method makers engaged in collusion whereas bidding on authorities contracts.

Greater than half of toddler method gross sales are made via a Division of Agriculture program that gives free method to low-income households, in accordance with FTC paperwork that detailed of the probe, which was reported earlier Wednesday by the Wall Avenue Journal. Contracts for these applications are administered via a state-level bidding course of.

In 2022, the FTC kicked off an investigation into whether or not individuals of child method market — which it stated is dominated by a small variety of producers — coordinated within the bidding course of to take care of management of markets in states the place they remained dominant. The company stated the businesses could be incentivized to take action as a result of gross sales via authorities method program can increase business gross sales.

Nestlé, which produces Gerber method, informed the Journal that the corporate has acquired an data request from the FTC and has responded.

An Abbott spokesman informed The Washington Put up it was cooperating with the FTC’s requests. In a February letter to the FTC, a lawyer for Abbott wrote that the corporate is “unaware of any proof that creates even a touch of collusion or coordination.”

Final February, contamination at an Abbott Diet manufacturing plant in Michigan led to a method scarcity that was exacerbated by pandemic associated provide chain points. The doc didn’t explicitly point out the scarcity in a Jan. 27 doc detailing its inquiry, though it did spotlight that Abbott controls 48 p.c of “a extremely concentrated market.”




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