UPDATED: 01 JUN 2022 02:24 PM EST
The Biden administration has reached a deal to transport 1.25 million cans of baby formula from an Australian company into the U.S. amid shortages that have sent parents scrambling for supplies.
The company, Bubs Australia, will send approximately 4.6 million bottles worth of its infant formula via two flights from Melbourne to Pennsylvania and California on June 9 and 11, respectively, the White House announced Wednesday afternoon. POLITICO previously reported that Bubs Australia and the Department of Health and Human Services were finalizing the shipping details Wednesday morning, according to two people familiar with the planning. The White House said in a statement that additional deliveries of Bubs Australia infant formula will be announced in the coming days.
In addition to the Bubs flights, the U.S. will also import 3.7 million bottles worth of Kendamil infant formula from the UK via emergency flights, the White House announced Wednesday.
President Joe Biden is trying to quell a political firestorm facing his presidency over the baby formula shortages, amid criticism from lawmakers and others that his administration was too slow to respond. FDA Commissioner Robert Califf recently admitted that agency officials “were too slow and some decisions in retrospect could have been more optimal” in their response to reports last fall of infants being hospitalized after consuming formula from the Abbott Nutrition plant in Sturgis, Mich., which is at the center of the current shortages. Abbott temporarily shut the plant down in February and issued a recall of some of the formula made there.
Formula manufacturers, some of whom met with the president at the White House on Wednesday afternoon, said they knew immediately that the Abbott plant shutdown and recall would create serious supply issues. “From the moment that that recall was announced we reached out immediately to retail partners like Target and Walmart to tell them this is what we think will happen,“ Robert Cleveland, a senior vice president with Reckitt, told Biden.
Lawmakers have raised questions about why the Biden administration didn't take steps on importing formula or other emergency responses until May.
Pressed by reporters after the meeting about the White House waiting until spring to respond, despite the fact that formula manufacturers knew right away that there would be problems, Biden responded, “They did, but I didn't.“
He added that he didn’t realize the seriousness of the infant formula shortages until “early April.“ According to two Biden officials, the president wasn't briefed on the formula crisis for weeks after Abbott's Feb. 17 recall.
Biden announced the initial deal that Bubs would provide 27.5 million bottles worth of infant formula to the U.S. several days ago. Australia's former Ambassador to the U.S. Joe Hockey and his firm Bondi Partners helped broker the initial deal between Bubs and the Biden administration. The company’s stock shot up after.
The administration hopes the flights will help ease the current formula shortages, which are especially dangerous for babies, children and adults who rely on specialty formulas for their only source of nutrition. The Bubs deal was made possible after FDA temporarily relaxed some of its strict import restrictions on formula from abroad.
In addition to Bubs and Reckitt, Biden met at the White House this afternoon with representatives from Perrigo Co., Nestle’s Gerber and ByHeart, according to the White House.
Notably, absent from the list: Abbott. The White House has left out the company from similar meetings in recent weeks. Two Biden officials described it as an attempt to apply public pressure to the company, which initially resisted steps such as paying for rebates so low-income parents and babies could buy another brand of infant formula using federally-funded benefits. Rather than attending White House meetings, the company needs to focus on meeting health and safety requirements at its Sturgis plant that were stipulated under an agreement with the FDA to reopen the facility, a White House official said.
Abbott's Sturgis plant was estimated to control about one-fifth of the U.S. infant formula supply before the recall. The FDA and Abbott have offered conflicting timelines about when the plant will reopen.
Abbott and three other companies dominate the U.S. infant formula market, leading lawmakers to question whether a federal nutrition program, known as WIC, has helped companies maintain their market power. White House officials have been considering several measures to help boost competition in the highly consolidated U.S. infant formula market. The Federal Trade Commission is also probing consolidation and any potential anti-competitive behavior in the market, along with scams targeting parents and caregivers.
During Wednesday's event, Biden plans to tout small manufacturers like ByHeart, a Pennsylvania-based baby formula company attending the meeting, as part of the solution to the consolidation that's contributed to the current shortages.
