U.S. lawmakers launch probe into baby formula shortage
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The House Oversight Committee of the U.S. Congress is launching an investigation into the ongoing shortage of baby formula products across the country.
In letters addressed to four of the largest manufacturers, Abbott (NYSE:ABT), Mead Johnson Nutrition of Reckitt Benckiser (OTCPK:RBGPF) (OTCPK:RBGLY), Nestle (OTCPK:NSRGY) (OTCPK:NSRGY), and Perrigo (PRGO), the lawmakers requested information and documents in this regard on Friday.
The panel expects to investigate cases of price gouging and the steps the companies are taking to address the shortage. In addition, the committee requests Abbott (ABT), the maker of Similac baby formula, to provide information on its recent product recall.
"We have asked for a briefing by the end of the month, and we've asked three basic questions: Do they have the supply to meet the demand? Is there a supply chain problem that can be corrected? And what can we do to make sure this doesn't happen again?" Chairwoman Carolyn Maloney, D-N.Y said.
Meanwhile, the regulators and company executives from Abbott (ABT) could be asked to appear before a hearing scheduled by the House Energy and Commerce Committee on the shortage later this month, a committee aide said.
Early this week, Bloomberg reported that Pharmacy chains CVS Health Corporation (CVS), Walgreens Boots (WBA), and retailer Target (TGT) were rationing the purchases of baby formula as the nationwide shortage worsened.