In 2022, the nation’s largest infant formula manufacturer sent new parents scrambling when it launched a product recall that sparked shortages nationwide. 

“It was beyond stressful,” one mother wrote in a statement to a committee of scientists tasked with analyzing what went wrong. “I would have to drive all around…checking stores for my baby’s formula, constantly calling her pediatrician's office for samples. Not knowing if we were going to have enough until the next store got another shipment…”

Infant formula is critical for infant nutrition, as only one in four babies receives breast milk exclusively in their first six months of life. The shortage affected all new parents, both rich and poor, during a pandemic that had already caused shortages of nearly everything, from produce to toilet paper.

“Panic buying, while completely natural under such circumstances, also seemed to make the shortages even worse,” said Katheryn Russ, professor and chair of economics in the UC Davis College of Letters and Science. “Plus, it was during the pandemic, which put other constraints on supply chains, so it was just the perfect storm.”

Russ was part of the National Academies of Sciences, Engineering, and Medicine committee funded by the U.S. Congress to analyze the causes for the infant formula shortage. The committee was chaired by Barbara Schneeman, a professor emerita of nutrition at UC Davis and former Director of Nutrition, Labeling, and Dietary Supplements in the US Food and Drug Administration (FDA) Center for Food Safety and Applied Nutrition. The report, “Challenges in Supply, Market Competition, and Regulation of Infant Formula in the United States,” also offers guidance on how to avoid shortages in the future.

Responding to a collapse in infant formula supplies during the pandemic

It wasn’t the pandemic that caused infant formula shortages. It began with a warning from the FDA to Abbott, which at the time was the largest producer of infant formula representing roughly 40% of the entire market in 2021.

The FDA identified bacterial contamination at Abbott’s largest production plant and recommended the company voluntarily recall its powdered formula. The company launched the recall and eventually paused production at the facility, which quickly led to widespread shortages that affected families nationwide.

One reason the shortage was so serious is that infant formula manufacturing is incredibly concentrated. U.S. manufacturers produce an average of 1.1 billion pounds of infant formula each year, representing 98% of all formula consumed by infants and young children domestically. In 2022 the top two infant formula manufacturers made up 66 percent of the market. 

“It makes our formula supply quite vulnerable that the production is so concentrated,” said Russ.

During the shortage, the U.S. government took multiple approaches to making up the difference. Among them, the Defense Production Act was leveraged to speed up production. 

Another response focused on jumpstarting imports by reducing regulatory barriers and tariffs. However, there were other barriers to importing formula. At one point the government even launched airlifts to bring infant formula from overseas.

“That's something you only see during wartime right?” said Russ. “An airlift of baby food was really extraordinary. That tells you just how powerful those barriers to imports are.”

Public sessions and written responses explained that the overall responses from both government and industry were effective but too slow compared to what was needed.

Securing the future of infants with a resilient formula supply chain

The concentration of infant formula production since 2022 has largely not changed. In the year following the shortage, Abbott’s market share of infant formula declined from 40% to 27%. That year, Abbott’s top competitor’s market share increased to 39%. Regulations and tariffs continue to keep infant formula an almost entirely domestic product.

However, Russ said that permanently reducing all barriers to imports might not be the answer. Instead, the report identifies five key vulnerabilities and provides detailed recommendations and commentary on how to address each of them:

• Lack of risk management planning to anticipate shortages
• High production concentration that creates a greater vulnerability to supply disruptions
• Barriers to speedy supply recovery caused by regulatory requirements and certain aspects of FDA’s authority for oversight of manufacturing 
• Challenges with government’s communication with the public and coordination with industry
• Dependence on infant formula rather than adequate support for breastfeeding

The report identifies tweaks to federal regulations from the FDA, the US Department of Agriculture and other federal agencies that might be needed in a crisis. It also recommends government and healthcare providers communicate with a more unified voice to families about what to do if no formula is available. 

Russ said the most important change could be to take a proactive approach to reduce the risks of things going wrong like they did in 2022. The Abbott manufacturing plant that shut down after the FDA’s recommendation was set to go online again when a flood after heavy rains took it offline again. 

“Without clearer rules for resiliency and risk management practices implemented by manufacturers, we’re really at risk for the same thing happening again,” said Russ. “Hopefully we'll be more prepared next time.”