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Mead Johnson Declines on Chinese Report of Additive

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July 10 (Bloomberg) -- Mead Johnson Nutrition Co., maker of the world’s best-selling baby formula, fell to its lowest price since February after a Chinese magazine said a prohibited additive was found in two batches of the company’s products.

The stock sank 4.3 percent to $75.29 at the close of New York trading.

Caijing Magazine in Beijing reported that the flavor additive vanillin, which the publication said can harm babies’ livers and kidneys, was found in batches of formula produced in October and April. Gail Wood, a spokeswoman for Glenview, Illinois-based Mead Johnson, said the company can’t verify the report’s accuracy and is reaching out to Chinese regulators.

“We do not add vanillin to any of our stage 1 products,” which are for infants up to 6 months old, Wood said today in a telephone interview. “We’re approaching the testing organization to understand their methodology and process.”

Mead Johnson, which makes the Enfamil line of formulas, does use vanillin in some products for older children, Wood said. She said she wasn’t sure whether the additive was used in the factory that produced the infant formula alleged to be contaminated. The company has “over 2,300 quality control and safety checks” to prevent cross-contamination, she said, and all batches are inspected before they’re distributed.

Abbott, Pfizer

The magazine said the additive was also found in formula made by Abbott Laboratories and Pfizer Inc.’s Wyeth unit. Pfizer fell less than 1 percent to $22.44, while Abbott gained less than 1 percent to $65.67.

Abbott doesn’t add vanillin or other flavors to stage 1 infant formula sold in China, spokeswoman Jennifer Smoter said in an e-mail. Pfizer also doesn’t use vanillin in stage 1 infant formulas, said Pfizer spokesman MacKay Jimeson.

“We are concerned about the accuracy of this report and we do not agree with the findings,” Jimeson said in an e-mail.

Mead Johnson’s Enfamil brand is the best-selling baby formula in the world, with about 7 percent of global sales, according to Bloomberg Industries. The company got about 29 percent of its worldwide sales from China last year, according to data compiled by Bloomberg.

To contact the reporter on this story: Alex Wayne in Washington at awayne3@bloomberg.net

To contact the editor responsible for this story: Reg Gale at rgale5@bloomberg.net

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