New York will receive more than $9.3 million under a multistate settlement with Abbott Laboratories over alleged safety failures at baby-formula manufacturing plants. Pennsylvania is also among the states joining the agreement.
New York Attorney General Letitia James announced the settlement Thursday. Abbott will pay more than $384 million to states and the federal government, including $348,700,868 for the federal government and $35,491,288 for participating states.
The New York State Medicaid Program is allocated more than $9.3 million. The attorney general's office says $5.3 million of that amount will go directly to New York State. The originating release did not provide a separate Pennsylvania allocation.
The lawsuit alleged that Abbott failed to maintain proper safety standards at manufacturing facilities in Sturgis, Michigan, and Casa Grande, Arizona, between January 2018 and December 2022. State officials alleged the practices put formula at risk of contamination while Medicaid and the Special Supplemental Nutrition Program for Women, Infants, and Children paid for products that did not meet program safety requirements.
The claims also alleged problems with equipment maintenance, water controls and disclosure of some contamination test results to federal inspectors. Abbott closed its Sturgis facility and recalled products in 2022 during a nationwide formula shortage.
The settlement resolves the government claims without a trial. New York led the state coalition with several other attorneys general, and Pennsylvania was among the additional states that joined.
