What Happened to Abbott Laboratories DOJ Case and Corporate Crime Enforcement?

Abbott Laboratories, a global healthcare company, has a long history of interactions with the U.S. Department of Justice (DOJ) and other regulatory bodies concerning corporate conduct. Early enforcement actions include a $100 million fine and consent decree with the FDA in 1999 over manufacturing deficiencies in its diagnostic products division, which required significant corrective measures.

A major turning point occurred in 2012 when Abbott agreed to pay $1.5 billion to resolve criminal and civil liability arising from the unlawful promotion of its anti-epileptic drug, Depakote. The company pleaded guilty to misbranding the drug by promoting it for off-label uses, such as controlling agitation in elderly dementia patients and treating schizophrenia, despite a lack of FDA approval and evidence of adverse events in clinical trials. This settlement included a $700 million criminal fine and forfeiture, $800 million in civil settlements with federal and state governments, and a Corporate Integrity Agreement with the Department of Health and Human Services.

In 2013, Abbott faced further enforcement, settling allegations that it paid kickbacks to physicians to induce them to purchase its carotid, biliary, and peripheral vascular products. The company paid $5.475 million to the United States to resolve these False Claims Act allegations, which originated from a whistleblower lawsuit.

The most significant and recent corporate crime enforcement focus on Abbott Laboratories stems from the 2022 infant formula crisis. Following reports of bacterial contamination (Cronobacter sakazakii) and infant illnesses, including deaths, linked to its Sturgis, Michigan manufacturing facility, Abbott initiated a voluntary recall of several infant formula products and temporarily closed the plant. This led to a severe nationwide formula shortage and prompted a DOJ criminal investigation into the company's handling of the situation.

Throughout 2024 and 2025, Abbott continued to face legal scrutiny. In early 2024, Abbott secured a defense verdict in a whistleblower retaliation trial. However, in December 2025, the U.S. Supreme Court reopened a whistleblower's Medicare fraud case against Abbott concerning diabetic testing supplies. Shareholder derivative lawsuits also progressed, with a federal court in November 2024 denying Abbott's motion to dismiss claims alleging breach of fiduciary duty and misleading statements related to the infant formula crisis.

As of July 2026, the DOJ closed its criminal probe into Abbott's infant formula plant. While some prosecutors reportedly believed they had sufficient evidence for criminal charges, including a misdemeanor under the Food, Drug and Cosmetic Act and charges against at least one individual, top decision-makers opted for civil penalties, specifically clawing back money the company earned from selling formula through federally funded nutrition programs. This decision has been met with controversy, with reports from The Wall Street Journal and Reuters highlighting a $500,000 donation made by Abbott to a presidential inauguration committee, raising questions about potential political influence. Concurrently, Abbott faces a multitude of civil lawsuits related to its infant formula, particularly concerning Necrotizing Enterocolitis (NEC) in premature infants. In March and April 2026, juries awarded significant damages to families in NEC cases, including a $53 million verdict in Illinois. A new whistleblower lawsuit was also filed in June 2026, alleging kickbacks and unnecessary medical procedures involving Abbott's devices. Abbott has denied allegations of collusion and fraud in this new case. In March 2026, Abbott agreed to invest $40 million over five years into its Sturgis plant to resolve stockholder allegations regarding infant formula safety.