Reckitt Benckiser tumbles on baby formula compensation woes

(Sharecast News) - Reckitt Benckiser tumbled on Friday amid concerns about baby formula compensation. According to Reuters, an Illinois jury has ordered Reckitt unit Mead Johnson to pay $60m to the mother of a premature baby who died of an intestinal disease after being fed the company's Enfamil baby formula.

The jury in an Illinois state court in St. Clair County on Wednesday found that Mead Johnson was negligent and that it failed to warn of the risk of necrotizing enterocolitis (NEC), Reuters said.

The disease, which causes the death of bowel tissue, mostly affects premature newborns and has a fatality rate of about 15% to 40%.

The $60m verdict includes compensation for plaintiff Jasmine Watson's loss and grief, and for the pain and suffering of her baby, Chance Dean.

The verdict comes in the first trial out of hundreds of lawsuits claiming that various Enfamil and Abbott Laboratories' Similac formulas caused NEC.

According to the US National Institutes of Health, there is evidence that formula increases the risk, opens new tab of NEC in premature infants compared with breast milk.

"This verdict confirms what Mead Johnson has known for years: cow's-milk based baby formula causes NEC in preterm infants, often with fatal consequences," Ben Whiting, a lawyer for Watson, said in a statement.

Mead Johnson said in a statement that it was disappointed with the verdict and would appeal it.

"We continue to believe that the allegations from the plaintiff's lawyers in this case were not supported by the science or experts in the medical community," it said.

At 1325 GMT, Reckitt shares were down 10.5% at 4,699p.