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Common Dreams - May 10, 2022

"Left unsaid by formula manufacturers is their iron grip on the market, which exacerbates supply disruptions."

A worsening shortage of baby formula in stores across the U.S. is highlighting the urgent need for antitrust regulations, progressives said Tuesday.

While Republicans are have attempted to lay blame for the crisis with the Biden administration, J.D. Scholten of the American Economic Liberties Project is among those pointing out that with just a few corporations controlling the majority of the infant formula market, families impacted by a recent recall by one of those companies have few options when looking for affordable alternatives.

"America needs antitrust!" Scholten said.

As David Dayen wrote at The American Progressive Tuesday, just four companies—Abbott Nutrition, Reckitt Benckiser, Nestlé, and Perrigo control nearly 90% of the U.S. baby formula market.

"Any disruption to one of their products will be magnified, whether it's a recall for Similac or inability to source ingredients," wrote Dayen. "A few companies in the market relying on the same sources creates a much more fragile supply chain."

Across the U.S., an average of 40% of infant formulas were out of stock at retailers like Target, Walgreens, and CVS at the end of April, according to Business Insider.

Six states—Texas, Tennessee, Missouri, South Dakota, North Dakota, and Iowa—are seeing shortages of more than 50% and stores are limiting purchases to three or four per customer, with prices surging to $33 per can.

Online, sellers on eBay are raising prices to $120 per can as desperate parents and caretakers struggle to feed their infants, according to the New York Times.

The shortages have been linked to a product recall by Abbott Nutrition—the manufacturer of Similac formula—in February. The company recalled three of its formulas when at least two babies died and four were hospitalized with bacterial infections after consuming the products.

Abbott is the exclusive supplier of formula for more than half of the nation's Women, Infants, and Children (WIC) agencies, according to the Times. WIC is the nation's largest purchaser of baby formula, and people who benefit from the program can only be reimbursed if they buy the brands that contract with the government.

"The unprecedented scope of this infant formula recall has serious consequences for babies and new parents," Brian Dittmeier, the senior director of public policy at the National WIC Association, told the Times. ...
Read the full report at Common Dreams