LOS ANGELES, Oct. 27, 2022 (GLOBE NEWSWIRE) — Portnoy Law Firm advises investors of Abbott Laboratories (“Abbott” or the “Company”) (NYSE:ABT) that a class action lawsuit has been filed in name of investors.
Abbott investors with more than $500,000 in losses on their investment are encouraged to contact Lesley Portnoy, Esq.
Please contact attorney Lesley F. Portnoy, by phone at 844-767-8529 or email: [email protected], to discuss their legal rights, or click here to join the case via www.portnoylaw. com. Portnoy Law Firm can provide a free case assessment and discuss options for investors to pursue claims to recover their losses.
Abbott is a medical device and healthcare company that offers a wide range of products, including various forms of infant formula sold under the Similac, Alimentum and EleCare brand names. At the start of 2022, Abbott was responsible for producing 40% of infant formula in the United States. Of that amount, nearly half was produced at the company’s manufacturing facility in Sturgis, Michigan (“Sturgis”), meaning that Abbott’s Sturgis plant fed approximately one in six babies fed. formula in the United States.
The Complaint alleges that, throughout the Class Period, the Defendants made numerous materially false and misleading statements and omissions regarding what the United States Food and Drug Administration (“FDA”) has characterized as ” manifestly unsanitary” at the company’s facilities in Sturgis. Specifically, the defendants have repeatedly touted to investors the safety and marketability of Abbott’s infant formula brands and their contribution to the company’s sales and revenue growth.
In truth, Abbott’s facility in Sturgis was in clear violation of several federal and state health and safety regulations. These violations, which the defendants deliberately or recklessly concealed from investors, jeopardized Abbott’s infant formula business and exposed the company to the risk of harsh regulatory action, including the recall of its products and the closure of the Sturgis plant. By February 2021 and throughout the Class Period, Abbott and Defendants received direct warnings, communications, FDA inspection reports and consumer complaints identifying the safety violations in detail. and regulations that plagued Sturgis facilities. Due to the defendants’ misrepresentations and omissions, Abbott common stock traded at artificially inflated prices during the class period.
The truth began to come to light on February 17, 2022, when the FDA publicly announced that it was investigating four consumer complaints of childhood illnesses linked to powdered infant formulas produced by Abbott in Sturgis. The FDA said it initiated an on-site inspection at the facility and to date has found multiple positive environmental sample contamination results for a bacterium, Cronobacter sakazakii (“Cronobacter”), linked to childhood illnesses and death. The FDA also revealed that its review of Abbott’s internal records indicated “environmental contamination with Cronobacter and the company’s destruction of the product due to the presence of Cronobacter.” As a result of these disclosures, Abbott’s stock price fell $3.79 per share, or 3.14%. In the following days, Abbott was forced to close the Sturgis plant due to serious safety concerns, shutting down one of the main sources of infant formula for all of the United States, as well as some Canadian markets and strangers.
About a month later, on March 22, 2022, the FDA released reports of its three inspections of the Sturgis facility conducted from 2019 to 2022. These reports indicated that (a) Abbott failed to establish process controls “designed to ensure that infant formula is not adulterated due to the presence of microorganisms in the formula or in the processing environment” and (b) Abbott has not “ensure that all infant formula contact surfaces are maintained to protect infant formula from contamination from any source.” On news of the damaging inspection reports, Abbott’s stock price fell 4 $.97 per share, or 4%.
As the FDA’s investigation continued, a redacted copy of a whistleblower complaint sent to the FDA in October 2021 was made public on April 22, 2022. Among other things, the whistleblower complaint revealed that the issues disclosed in February and March 2022 were in fact known to Abbott management much earlier. When the whistleblower complaint was released, Abbott’s stock price fell $4.51 per share, or 3.8%. Then, on June 8, 2022, investors learned that, contrary to the Company’s repeated denials, Abbott was aware of the whistleblower’s formal allegations in early 2021, when it was reported that the company’s whistleblower FDA had filed a complaint in February 2021 with the US Labor Department’s Occupational Safety & Health Administration (“OSHA”), and that OSHA forwarded this complaint to Abbott and the FDA in the same month. In response, Abbott’s stock price fell $4.17 per share, or 3.5%.
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Portnoy Law Firm represents investors in the prosecution of claims caused by corporate wrongdoing. The company’s founding partner has recovered more than $5.5 billion for harmed investors. Lawyer advertisement. Prior results do not guarantee similar results.
Lesley F. Portnoy, Esq.
Admitted to the CA and NY Bar