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Abbott and Reckitt's Mead Johnson Cleared in $6 Billion NEC Infant Formula Lawsuit; Shares Surge

Nov 1, 2024, 08:17 AM

Abbott Laboratories Inc. and Reckitt Benckiser Group's Mead Johnson unit were cleared of liability by a St. Louis jury in a lawsuit alleging their cow's milk-based infant formulas caused a severe intestinal illness in premature infants. The Missouri case, brought by a mother whose lawyer, Timothy Cronin, sought more than $6 billion in punitive damages, accusing the companies of failing to warn that their products could cause necrotizing enterocolitis (NEC), a potentially lethal gastrointestinal disease. 'Companies have to clearly and unambiguously tell us the truth about their products, especially those intended for the smallest and most vulnerable human beings,' Cronin told the jury. After approximately three hours of deliberation, the jury found that Abbott and Mead Johnson were not responsible for the young boy’s debilitating condition. This marks the first trial win for the companies in litigation that includes around 1,000 similar lawsuits. The lawsuits have raised concerns from doctors who say the litigation could threaten the availability of these formulas. Following the verdict, shares of Reckitt Benckiser surged by up to 11%, and Abbott's shares rose nearly 5%.