Baby Formula Maker Extends WIC Rebates to Ease Shortage Crisis

WASHINGTON — Abbott Nutrition on Friday committed to continue providing rebates in states with which it holds Special Supplemental Nutrition Program for Women, Infants, and Children contracts through August 31 in a bid to ease the ongoing baby formula crisis.

The decision means that families that rely on the WIC program will be able to obtain infant formula free of charge whether it’s Abbott’s Similac or a formula from another manufacturer.

According to the White House, the company’s decision came in response to a letter sent by Agriculture Secretary Thomas Vilsack to Abbott Laboratories’ Chairman and CEO Robert Ford this morning.

In the letter Vilsack said, “While USDA appreciates the work you have done to replace impacted Abbott products and shift production to non-impacted facilities to attempt to mitigate supply impacts, we believe that Abbott can do more to ensure that WIC participants in states that have contracted with Abbott have access to formula.”

Since the recall began, the agriculture secretary noted, “Abbott has provided rebates for alternative products, including competitive brands, so that WIC participants have continued access to safe formula. 

“We are concerned, however, that you have extended this flexibility to states on a month-by-month basis setting up uncertainty each month for the WIC program and its participants,” he said.

“In order to allow states to plan and reassure participants that they will have reliable access to formula for their babies, we ask that you extend these rebate commitments for all contracted products through at least August 31, 2022. We further request that you continue these commitments until Abbott’s formula supply meets demand across the country. I believe Abbott must take these additional actions to support vulnerable WIC families during this challenging time,” Vilsack added.

In a statement on its website, Abbott Nutrition said that since the recall began in mid-February, one of its highest priorities has been to mitigate the supply issues. 

“In particular we’ve been focusing on production in our Cootehill, Ireland, facility to serve [the] state Special Supplemental Nutrition Program for Women, Infants and Children consumers,” it said.

“We know that the recall has worsened the industry-wide infant formula shortage, and we have been working to get as much product into the hands of parents as we can,” it added. 

Since February, the company said, it has:

• Air shipped millions of cans of infant formula powder into the U.S. from its FDA-registered facility in Cootehill, Ireland.
• Prioritized infant formula production at its Columbus, Ohio, facility, converting other liquid manufacturing lines into manufacturing Similac liquid ready-to-feed. 
• Offered an increased number and value of coupons available for all infant formula products, including Similac ready-to-feed, to enable customers to purchase formula, either free or deeply discounted.
• Run its other manufacturing facilities at full capacity as it continues to prioritize production of infant formula to help replenish the supply in the market.

At the same time, the company said it has been working to address the FDA’s 483 observations so it can restart operations at the still-shuttered Sturgis, Michigan, facility where bacterial contamination was first identified.

“We immediately began implementing corrective actions and, subject to FDA approval, we could restart our Sturgis, Michigan, site within two weeks,” Abbott Nutrition said. “We are confident that we can continue to produce safe, high-quality infant formula at all of our facilities as we have been doing for millions of babies around the world for decades.”

Dan can be reached at [email protected] and @DanMcCue