Abbott Nutrition, one of the largest manufacturers of infant formula, is planning a new facility to increase production, as shortages of the product continue to cause problems across the United States.
In a call with investors on Oct. 19, Abbott chairman and CEO Robert Ford said the company is planning to build a $500 million facility to manufacture specialty and metabolic infant formulas. On the call, Ford said the company was in the final stages of determining where the plant will go, saying they “will work with regulators and other experts to ensure this facility is state-of-the-art and sets a new standard for infant formula production.”
There has been a shortage of baby formula across the United States that began in February, when Abbott was forced to close its largest plant over a federal investigation into bacterial infections among infants who had consumed powdered formula from the plant, CBS News reported. The company said its products have not been directly linked to the infections.
A survey by the U.S. Census Bureau found that nearly a third of U.S. households with a baby under age 1 said they had trouble finding formula over the course of one week last month, CNN reported. More than 40% of those who responded said they had a week’s supply of formula or less.
On the call, Ford said the decision to build the new plant was in response to an analysis of the shortage that found “this country would benefit from more manufacturing capacity and redundancy,” CBS News reported.
Abbott is the largest infant formula manufacturer in America, and its largest production facility is currently in Sturgis, Michigan, the Minnesota Star Tribune reported.
The Sturgis plant reopened in July after severe weather forced it to close almost immediately after it reopened in June, CNN reported.
Ford said on the call that the company has boosted its production exponentially, saying, “we delivered roughly the same volume of formula to our U.S. customers this past quarter as we did during the three months prior to the recall,” CNN reported.
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