Lessons Still Not Learned from the Infant Formula Crisis

Gabriella Beaumont-SmithOn March 28, the House Oversight Committee heldpart one of hearings on the Food and Drug Administration (FDA) and its handling of the infant formula crisis. Former FDA Deputy Commissioner Frank Yiannas testified that the crisis could have been averted, or at the very least, the magnitude lessened. At Cato, we completelyagree.Unfortunately, Yiannas ’ proposed solution was more of what got us into this mess in the first place: overregulation of the formula industry and overbearing FDA authority. Other policymakers argue for much the same.Yet the infant formula industry ’s weakness is not owed to a lack of regulation or FDA authority. In fact, as explained in a recent Catobriefing paper, overregulation of the U.S. infant formula market turned what should have been a  temporary headache into a yearlong crisis. After Abbott Nutrition—the largest U.S. infant formula manufacturer—shut down its Michigan factory and nationally recalled its products, several different U.S. laws and regulations prevented other formula suppliers from plugging the hole punched in t he U.S. market. Thus, this overregulation left retailers with few to no alternatives to Abbott’s brands, creating a massive supply shock that rippled throughout the country.The federal government responded in multiple ways and the crisis waned in the fall of 2023. But, as the paper details, thesuccessful responses did the opposite of increase regulation.First, high tariffs and tariff ‐�...

Source: Cato-at-liberty - April 6, 2023 Category: American Health Authors: Gabriella Beaumont-Smith Source Type: blogs