A sign on an empty shelf informs customers that there is no stock in the back for infant formula at a supermarket on May 23, 2022 in New York City

Biden’s FTC launches investigation into reports baby formula firms engaged in deceptive practices

Federal Trade Commission launches investigation into reports baby formula firms engaged in deceptive practices and price gouging and whether the GOVERNMENT contributed to supply chain chaos that caused widespread shortage

  • The body is asking for public input on whether state or federal agencies have contributed to the fragile baby formula supply chain
  • FTC Chair Lina Khan said the shortage is ‘causing enormous anxiety, fear, and financial burden for American families’ in a statement on Tuesday
  • Last week roughly 45 percent of formula products nationwide were out of stock
  • The Biden administration was criticized for not acting fast enough to avert the crisis, which has been linked to multiple recent baby hospitalizations
  • President Biden signed a number of emergency measures for the shortage 

The Federal Trade Commission on Tuesday launched an investigation into the ongoing baby formula shortage that’s put a strain on American families across the country.

The body will look into whether formula suppliers engaged in ‘deceptive, fraudulent, or otherwise unfair business practices’ to ‘take advantage’ of Americans as well as what elements contributed to the fragility of the product’s supply chain and concentration of the majority of the market into a few companies. 

It also encourages Americans to speak out on whether the believe any policies created by the federal and state governments contributed to the crisis, as the Biden administration desperately works to alleviate the strain after being criticized for not acting sooner.

‘We have been monitoring and will continue to monitor the ongoing infant formula shortage which is causing enormous anxiety, fear, and financial burden for American families,’ FTC Chair Lina Khan said in a statement.

‘The FTC is launching a public inquiry to identify the factors that contributed to the shortage or hampered our ability to respond to it. Learning from this experience can help determine how we can minimize the risk of similar shortages in the markets for other life-sustaining products.’ 

The commission ‘seeks public input on whether the FTC itself or state or federal agencies may have inadvertently taken steps that contributed to fragile supply chains in the market for these crucial products for many American families,’ an announcement sent by the White House read.

A sign on an empty shelf informs customers that there is no stock in the back for infant formula at a supermarket on May 23, 2022 in New York City

The shortage has hit families that have babies with dietary issues the hardest

The FTC is cracking down on unfair practices on the part of baby formula manufacturers and whether the government's regulations contributed to the shortage

The FTC is cracking down on unfair practices on the part of baby formula manufacturers and whether the government’s regulations contributed to the shortage

They’re also looking to hear about ‘instances where families have experienced fraud, deception, or scams when attempting to purchase infant formula or been forced to purchase formula from online resellers at exorbitant prices.’ 

On the supply-end, officials are questioning ‘whether small and independent retailers have faced particular difficulties accessing limited supplies of infant formula compared to large chain retailers.’ 

Just four manufacturers are responsible for producing more than 90 percent of the country’s baby formula supply.

Roughly 45 percent of formula products nationwide were out of stock last week, according to CBS. The parents hit the hardest are those whose children have dietary or other issues that limit the kinds of formula they can eat. 

President Biden has taken several measures to mitigate the increasingly dire baby formula shortage, including Operation Fly Formula, which is aimed at ramping up international imports of baby formula to raise US supply.

But his administration has faced criticism over failing to act sooner amid the worsening crisis.

President Joe Biden has taken several emergency steps to try and alleviate the crisis after being accused of not acting fast enough

President Joe Biden has taken several emergency steps to try and alleviate the crisis after being accused of not acting fast enough

That includes Operation Fly Formula, which allows commercial military aircraft to fly thousands of pounds of baby formula from Europe to the US

That includes Operation Fly Formula, which allows commercial military aircraft to fly thousands of pounds of baby formula from Europe to the US

Biden officials however have pointed out that parents began struggling when formula manufacturer Abbott Nutrition was forced to shutter its Michigan plant over bacterial contamination.

Abbott announced last week that it had come to an agreement with the Food and Drug Administration on fixing safety issues at the facility, which has been shuttered for more than three months.

Among the measures Biden greenlit amid mounting pressure to act on the formula shortage was authorizing commercial military aircraft to haul supply from overseas – provided it meets US health standards.

Over the weekend roughly 78,000 pounds of baby formula was flown into Indianapolis, Indiana from Ramstein Air Base in Germany in the first shipment of the program. 

The president also invoked the Defense Production Act forcing suppliers to prioritize directing resources to infant formula production above all other contracts.

Last week, the House of Representatives narrowly passed a bill aimed at easing the formula shortage – despite the opposition of 192 Republicans. 

GOP lawmakers have argued that giving more money to the Food and Drug Administration, which the legislation does, is not a viable solution. 

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