Abstract: The Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) is the major purchaser of infant formula in the United States. To reduce cost to the WIC program, […]
The Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) is the major purchaser of infant formula in the United States. This study evaluates recent trends in net prices for infant formula and cost implications for WIC.
WIC provides supplemental food, nutrition education, and referrals to health care and other social services to low-income, nutritionally at-risk women, infants, and children up to 5 years of age. This report explains how WIC works, examines program trends, describes some of the lesser known effects of WIC, and discusses some of the major economic issues facing the program.
USDA’s Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) is the major purchaser of infant formula in the United States. WIC State agencies are required to have competitively bid infant formula rebate contracts with infant formula manufacturers. This study analyzes the winning and losing bids from the infant formula manufacturers (July 2015).
Across the 46 WIC State agencies, real net price decreased by an average 43 percent (or 23 cents per 26 ounces of reconstituted fluid), allaying concerns about increasing real net prices. With lower net prices, combined with declining WIC purchases of infant formula, WIC State agencies paid $107 million less for formula in their new contracts over the course of a year.
Infant formula sales in the US are a competitive and profitable marketplace environment. FDA restrictions on such new formula releases are designed to ensure that there is minimal evidence of risk, but often the evidence for benefit is not established. Some of these products may confuse families relative to the value of breastfeeding or to the value of spending money on more expensive formulas than are medically needed. In other cases, they lead to multiple formula switches over relatively minor symptoms that would best be managed through parental education. They may also pose risks for populations including late preterm infants or infants with other risk factors for poor growth.
