Abbott Labs CEO Robert Ford said during a recent interview on CNBC's "Squawk Box" that ongoing litigation regarding Similac and Enfamil infant formula could negatively impact public health.
The lawsuit, filed by families of premature babies who suffered or died from necrotizing enterocolitis (NEC), alleges that the formula makers knew the risk of NEC and did nothing to warn families.
Ford claims that products and ingredients were deemed safe and have also been reviewed by regulators.
"So, I felt it was important to be able to explain exactly what was going on in our position," Ford said on Squawk Box. "And, at the highest level, you know, this is not infant formula that you go buy at a grocery store. These are specialized infant formulas that are used in the NICU for hospital use for preterm babies."
Ford pointed to plaintiffs' lawyers "advancing a theory" that these products, when used in the NICU, cause NEC—and that the risk should have been specified on the product label.
"Well, a couple of points here: Number one, nobody knows actually what causes NEC. There are NGOs that are working to try and discover what causes it so that a cure can be can be achieved. But babies, premature babies that use human milk can get NEC and premature babies that use and from formula can get NEC."
Specialists determine how to feed premature babies and that Abbott Labs provides "all the information that they need to make the right decision and the right treatment decision," Ford said.
"So this is a standard-of-care product and this is very widely supported by the medical community, which is why I said if for some reason this product were no longer available, the NICU's would not have the product and the food they need to be able to feed these preterm babies."
Ford said that such a scenario would create "a public health crisis" that would impact "every state in this country."
Abbott is urging any and all who are involved in public health, and those who care about the health of premature babies, to be aware of the situation and take action to ensure that there's a safe, continuous supply of these specialized products in the NICU, Ford said.
The litigation's impact on Abbott's stock is overblown, according to Ford, and that from a revenue perspective the number is very small for the company at $9 million.
Abbott Labs announced its second-quarter earnings on Thursday, noting revenue rose 4% year over year to $10.38 billion.
Abbott's adjusted diluted earnings per share was $1.14, which was more than the estimated $1.10, Yahoo! Finance reported. Medical device sales also increased 10.2% to $4.73 billion.