WIS. ACCUSES FORMULA MAKERS OF PRICE-FIXING

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The assault on alleged price-fixing in the $2.6 billion baby formula business continued last week when the state of Wisconsin sued the top two players in the lucrative category.

The Milwaukee County Circuit Court suit is aimed at market leader Abbott Laboratories' Ross Laboratories, maker of Similac, and Bristol-Myers Squibb Co.'s Mead Johnson & Co., maker of Enfamil. It accuses the companies of coordinating marketing to reduce competition in bidding for a contract to provide formula for the government's Special Supplemental Food Program for Women, Infants & Children.

Florida and Texas earlier sued Ross and Mead Johnson on similar grounds. The companies settled the Florida case last year for a reported $8 million; neither admitted guilt. The Texas case is pending.

Two years ago, the Federal Trade Commission intervened in other baby formula marketing practices when it alleged collusion involving pricing and agreements not to advertise to consumers.

In that settlement, several marketers agreed to refrain from exchanging media ad information with other manufacturers and from asking competitors to refrain from advertising. Again, the companies admitted no wrongdoing.

Ross still does not advertise baby formula. Mead Johnson advertises the Gerber brand and Next Step toddler formula, through J. Walter Thompson USA, Chicago, but does not advertise its No. 1 brand, Enfamil.

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