Abbott Laboratories to Pay $385 Million to Settle Infant Formula Allegations

12:35 PM EDT, 09/14/2026 (MT Newswires) -- Abbott Laboratories (ABT) agreed to pay about $385 million to resolve allegations that infant formula produced at the company's Sturgis, Michigan, facility failed to meet statutory, regulatory, and contractual requirements, the US Department of Justice said Monday. The complaint alleged that Abbott knowingly manufactured infant formula purchased with taxpayer dollars in an environment that put the products at risk of microorganism contamination, potentially affecting their reliability, quality and safety. Under the civil settlement agreement, the company will pay $348.7 million to the US to resolve False Claims Act allegations and another $36.3 million to certain US states for claims under their State Medicaid and Women, Infants, and Children programs. Abbott said the settlement does not represent any finding of fault or liability, and that no unopened, distributed Abbott infant formulas have ever tested positive for Cronobacter sakazakii or Salmonella Newport bacteria. Shares of the company were up 1.1% in Monday trading. Price: 103.10, Change: +1.15, Percent Change: +1.12