Formula supply problem worsens | CNN Business

Formula supply problem worsens | CNN Business

Formula supply problem worsens |  CNN Business


New York
CNN Business

For months, stores across the country struggled to stock enough formula. Manufacturers say they are producing at full capacity and making as many formulas as possible, but it’s still not enough to meet current demand.

The stock-out rate for infant formula hovered between 2% and 8% in the first half of 2021, but began to rise sharply last July. Between November 2021 and early April 2022, the stock-out rate jumped to 31%, according to data from Datasembly.

That rate rose another 9 percentage points in just three weeks in April, and now stands at 40%, according to statistics. In six states — Iowa, South Dakota, North Dakota, Missouri, Texas and Tennessee — more than half of infant formula was completely sold out in the week beginning April 24, Datasembly said.

And though seven states had between 40 and 50 percent of baby products out of stock in early April, 26 states are now struggling with supplies.

“This issue has been compounded by supply chain issues, product recalls and historic inflation,” said Datasembly CEO Ben Reich. “Unfortunately, given the unprecedented volatility in the category, we expect infant formula to continue to be one of the hardest hit products in the market.”

CVS and Walgreens have confirmed that they are limiting customers nationwide to three toddler and infant formula per transaction. “We continue to work diligently with our vendor partners to best meet customer demands,” Walgreens said in a statement to CNN Business.

A Target spokesperson confirmed that the retailer has limited formula purchases to four units per customer for online purchases. There is no limit to the number of units that can be purchased in person at Target stores, the company said.

Customers have shared images on social media of Walmart imposing similar constraints on its sales of infant formula, although Walmart has not confirmed whether this is a national policy. Images shared with CNN Business show empty shelves where formula should be, and a sign saying only five units were allowed per customer.

Walmart did not immediately respond to a request for comment from CNN Business.

The shortage has been exacerbated by the Food and Drug Administration’s closure of an Abbott Nutrition facility in Sturgis, Michigan. Abbott is a major producer of infant formula.

In February, the U.S. Food and Drug Administration recalled three brands of powdered baby formula made by the company due to potential bacterial infections, including Salmonella. The agency has advised parents not to buy or use certain lots of Similac, Alimentum and EleCare powdered infant formula, all Abbott brands.

A former Abbott Nutrition employee filed a whistleblower complaint with the FDA months before the recall, documenting concerns that the company was hiding safety issues at its plant in Sturgis, Michigan. . Formulas made at the facility were recalled after four infants who drank them fell ill with rare infections caused by the bacteria Cronobacter sakazakii. Two infants died, according to the complaint.

Abbott said the former employee was terminated for “serious violations of Abbott’s food safety policies” and will investigate further allegations.

“After his termination, the former employee, through his attorney, made evolving, new and growing allegations with multiple authorities,” a spokesperson for Abbott said in a statement.

The Abbott spokesperson also said products tested for Cronobacter sakazakii and Salmonella all came back negative and no Salmonella was found at Sturgis facilities during the investigation.

“The Cronobacter sakazakii that was found during environmental testing during the investigation was in non-product contact areas at our Sturgis facility and was not linked to the two available patient samples or any other known childhood illness,” the spokesperson said.

Finding a standard formula became difficult for parents, many of whom described the extraordinary lengths they went to to score even a single can or bottle. Specialty formula is even harder to find amid widespread shortages. Parents are driving to neighboring states to try their luck, and many are asking for help on social media, pleading with strangers to share or even trade any extra supplies they might have.

Abbott told CNN in a statement on Saturday it is working closely with the FDA to resume operations at its Michigan plant.

“We continue to make progress on corrective actions and will implement additional actions as we work to address items related to the recent recall. In the meantime, we are working to increase infant formula supply by prioritizing to the production of infant formula at our facilities that supply product to the U.S. market,” Abbott said in a statement to CNN Business.

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