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Mead Johnson: Rival and Co-DefendantNarrow moat

Abbott Laboratories (ABT) — moat facet

Abbott and Mead Johnson compete in preterm formula and are sued together; an appeals court's reversal of a $60 million verdict against Mead Johnson helped Abbott too.

In preterm infant formula Abbott's rival is also its partner in court. Abbott and Mead Johnson both make specialty formulas for premature babies, and both face lawsuits alleging that the formulas cause necrotizing enterocolitis, an intestinal disease. Abbott says the remaining claims include individuals who "named both Abbott and Mead Johnson without identifying which" company's formula was given1.

NEC litigation outcomes cited by Abbott, 2024-2026 ($M)495Gill verdict against Abbott, 202460Mead Johnson verdict reversed, 2026670Abbott settlements, Aug 2026Abbott release on NEC settlements, 20 August 2026
One rival's appeal helps the other.

That makes the relationship cooperative where it matters most. In June 2026 the Illinois Appellate Court reversed a $60 million verdict against Mead Johnson, applying the learned intermediary doctrine, "a defense relevant in a substantial number of cases"2. A ruling that a manufacturer's duty to warn runs through the doctor helps every formula maker, and Abbott cited it in its own announcement.

The rivals' legal records have run in parallel. Abbott won all three federal bellwether cases in the multidistrict litigation, and the Seventh Circuit affirmed one of those wins in July 20263. But it also lost the Gill case in Missouri, a $495 million jury award4, and in August 2026 settled it with about 2,000 other claims for about $670 million5.

On the shelf the two compete in the usual way, for hospital neonatal units that choose one formula. In the courtroom each is better off when the other wins.

The courts have also ruled for the industry in other venues. In March 2026 a Florida state court, applying the learned intermediary doctrine, dismissed claims involving preterm infant formula6. Each such ruling lowers the value of the claims against both companies.

The two companies have stood side by side in court. In an October 2024 Missouri trial involving Abbott, "another infant formula manufacturer" and the treating hospital, the jury returned a unanimous verdict for the defendants7, though a new trial was later granted8.

The relationship holds as long as the defense holds. A verdict against either company that an appeals court upholds on the duty-to-warn question would weaken the doctrine both rely on, and the claims behind the remaining 1,700 lawsuits would be worth more.

Moat trajectory: Holding steady

Federal bellwethers won; Illinois reversal for Mead Johnson June 2026.

The number that tests this moat
Reported
Infants named in pending NEC claims
About 12,700 (after the August 2026 settlements)

The size of the shared litigation; a rising count would mean the defense is not deterring new filings.

Source: Abbott release, NEC settlements ↗
References
  1. ReportedAbbott says the remaining claims include individuals who "named both Abbott and Mead Johnson without identifying which" company's formula was given.
    Abbott Laboratories release of 20 August 2026, Form 8-K exhibit 99.1 - agreements to resolve the Gill case and NEC claims on behalf of about 2,000 other infants for about $670 million; the $495 million Gill verdict; three federal MDL bellwether wins; about 1,700 lawsuits remaining on behalf of about 12,700 infants. — August 2026 · publ. 20 August 2026 · source ↗
  2. ReportedIn June 2026 the Illinois Appellate Court reversed a $60 million verdict against Mead Johnson, applying the learned intermediary doctrine, "a defense relevant in a substantial number of cases".
    Abbott Laboratories release of 20 August 2026, Form 8-K exhibit 99.1 - agreements to resolve the Gill case and NEC claims on behalf of about 2,000 other infants for about $670 million; the $495 million Gill verdict; three federal MDL bellwether wins; about 1,700 lawsuits remaining on behalf of about 12,700 infants. — August 2026 · publ. 20 August 2026 · source ↗
  3. ReportedAbbott won all three federal bellwether cases in the multidistrict litigation, and the Seventh Circuit affirmed one of those wins in July 2026.
    Abbott Laboratories release of 20 August 2026, Form 8-K exhibit 99.1 - agreements to resolve the Gill case and NEC claims on behalf of about 2,000 other infants for about $670 million; the $495 million Gill verdict; three federal MDL bellwether wins; about 1,700 lawsuits remaining on behalf of about 12,700 infants. — August 2026 · publ. 20 August 2026 · source ↗
  4. ReportedBut it also lost the Gill case in Missouri, a $495 million jury award, and in August 2026 settled it with about 2,000 other claims for about $670 million.
    Abbott Laboratories release of 20 August 2026, Form 8-K exhibit 99.1 - agreements to resolve the Gill case and NEC claims on behalf of about 2,000 other infants for about $670 million; the $495 million Gill verdict; three federal MDL bellwether wins; about 1,700 lawsuits remaining on behalf of about 12,700 infants. — August 2026 · publ. 20 August 2026 · source ↗
  5. ReportedBut it also lost the Gill case in Missouri, a $495 million jury award, and in August 2026 settled it with about 2,000 other claims for about $670 million.
    Abbott Laboratories release of 20 August 2026, Form 8-K exhibit 99.1 - agreements to resolve the Gill case and NEC claims on behalf of about 2,000 other infants for about $670 million; the $495 million Gill verdict; three federal MDL bellwether wins; about 1,700 lawsuits remaining on behalf of about 12,700 infants. — August 2026 · publ. 20 August 2026 · source ↗
  6. ReportedIn March 2026 a Florida state court, applying the learned intermediary doctrine, dismissed claims involving preterm infant formula.
    Abbott Laboratories release of 20 August 2026, Form 8-K exhibit 99.1 - agreements to resolve the Gill case and NEC claims on behalf of about 2,000 other infants for about $670 million; the $495 million Gill verdict; three federal MDL bellwether wins; about 1,700 lawsuits remaining on behalf of about 12,700 infants. — August 2026 · publ. 20 August 2026 · source ↗
  7. ReportedIn an October 2024 Missouri trial involving Abbott, "another infant formula manufacturer" and the treating hospital, the jury returned a unanimous verdict for the defendants, though a new trial was later granted.
    Abbott Laboratories Form 10-K for 2025 (year ended 31 December 2025) - Item 1 and MD&A for Nutritional Products: pediatric and adult nutrition in the US and abroad. — FY2025 · publ. 20 February 2026 · source ↗
  8. ReportedIn an October 2024 Missouri trial involving Abbott, "another infant formula manufacturer" and the treating hospital, the jury returned a unanimous verdict for the defendants, though a new trial was later granted.
    Abbott Laboratories Form 10-K for 2025 (year ended 31 December 2025) - Item 1 and MD&A for Nutritional Products: pediatric and adult nutrition in the US and abroad. — FY2025 · publ. 20 February 2026 · source ↗
Sources
Generated October 6, 2026