Abbott Laboratories (ABT) on Monday has reached an agreement with the U.S. Department of Justice (DOJ) to pay $385 million and resolve claims related to the company's manufacturing and 2022 recall of powdered infant formula at its Sturgis, Michigan facility.
The recall followed investigations into five infant illnesses involving Cronobacter sakazakii. Government testing found that unopened Abbott formula from the homes of the infants under investigation tested negative for the bacteria, while the Centers for Disease Control and Prevention (CDC) later concluded there was no definitive link between the Sturgis facility and the clinical cases.
The DOJ further alleged that Abbott caused government programs to purchase powdered infant formula manufactured at the Sturgis facility despite the products failing to meet certain statutory, regulatory and contractual requirements at the federal and state levels.
The allegations also involved products manufactured at Abbott's Casa Grande, Arizona facility between 2018 and 2022.
Under the civil settlement, Abbott will pay $348.7 million to the U.S. government to resolve False Claims Act allegations and $36.3 million to certain states for claims ...