Abbott Laboratories has agreed to pay more than $384 million to resolve U.S. Justice Department allegations that it knowingly produced infant formula in potentially contaminated environments at its Michigan and Arizona facilities, including inadequate testing and failure to disclose positive contamination tests to regulators. The settlement resolves the civil claims without an admission of wrongdoing or a finding of liability, and the related criminal investigation has been closed. The case stems from Abbott's 2022 Similac recall, which followed contamination concerns at its Sturgis, Michigan plant and contributed to a nationwide infant-formula shortage; Abbott maintains that no unopened, distributed formula tested positive for contamination. The payment is manageable against Abbott's scale: the company generated $12.6 billion of sales in Q2 2026, raised its full-year adjusted EPS outlook to $5.45-$5.60, and returned $2.1 billion to shareholders during the quarter. Abbott separately resolved a portion of litigation involving specialty formulas for preterm infants for approximately $670 million, covering the Gill case and claims involving roughly 2,000 individuals, while its June 2026 10-Q said numerous NEC-related lawsuits remained outstanding and disclosed that a $495 million Missouri jury award had been affirmed on appeal, with Abbott seeking further review.
Abbott LaboratoriesAbbott agreed to pay over $384 million to settle DOJ allegations of contaminated infant formula production and withheld contamination tests.
