Disclaimer: The views expressed in this article are those of the author and do not necessarily reflect the views of the Economic Times – ET Edge Insights, its management, or its members

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Stranger things continue to unfold in 2022, and it’s not just the release of the fourth season of the Netflix hit show. After considering the likelihood of a third world war, the US was confronted with another issue that was just as baffling as the sharp increase in gas prices: a major scarcity of infant formula. Recently, the greatest supply of infant formula to date was announced by US President Joe Biden and one of the biggest pharmaceutical corporations in the world, Abbott, has apologised for enabling the crisis to largely cripple the economy and American homes for weeks due to a scarcity of infant formula milk. What caused the crisis, was not just a shortage of milk formula supply, but the rampant use of bots across the internet. Americans with access to internet aggregators used bots to continuously search across online platforms for infant formula to help some homes cope with the scarcity.. It turns out that Elon Musk’s Twitter Bot worries weren’t entirely unfounded because these bots allowed businessmen to resell the formula across platforms at a significant markup while others were making every effort to provide it for free.

When Elon Musk highlighted concerns about automated bot accounts as a potential justification to back out of the $44 billion Twitter purchase a few months ago, many experts scoffed at the idea of the impact bots would have on the real world. The largest superpower in the world and a major pharmaceutical firm, however, would need to provide an explanation for why such a catastrophe occurred in the first half of 2022.

Stocks of baby formula were out of stock by 43% in the first week of May, according to the Datasembly research platform, prompted mainly by the voluntary recall from Abbott. Computer bots activated by ‘scalpers’ or opportunists were scouring the internet for formula and had advantage over most parents who found local physical stores replete of the essential product. These bots gave certain individuals the advantage of purchasing large amounts of tins in advance before anybody else, while parents at the other end were desperately hitting the notification buttons and refreshing the page. While the scalpers exacerbated the situation, the number of these individuals is unclear from those offering it for free. The situation considerably worsened with the recall, leading to subsequent alternative baby formula makers to run at full capacity.

What amazed the world with the entire situation, was that despite the numerous import regulations by the FDA, the US food regulation body, within the mainland, the US is considering imports from neighbouring nations, including from Europe.

Ironically, Abbott is one of the largest producers of baby formula, with around 43% market share. This has prompted the FTC or the Federal Trade Commission to relook at the level of market concentration and market consolidation in the infant formula industry. However, Abbott has vehemently denied any role harmful bacteria causing the death of infants, due to which there was a voluntary recall of baby formula by the brand. According to them, there was no conclusive evidence linking the death of the infants to the formula supplied by them. On the other hand, several still blame the shortage of baby formula to the initial impact of lockdowns and labour shortages across the country due to the pandemic. The situation escalated to the point when the US government was prompted to rely on its military resources to specially transport formula from other nations. The Defence Production Act was invoked to give priority to the baby formula manufacturers first preference in supplies. This no doubt prompted the FDA to conduct a complete investigation of the baby formula producing plants across the nation.

While the Biden administration is scrambling to address the massive shortage, the FDA commissioner Robert Califf was recently quoted as saying that the country might soon have a surplus of infant formula. While the data from the operational plants continues to come in, some Americans are resorting to donating breast milk or according to the CDC even, resorting to giving cow’s milk for a limited amount of time.

In the wake of the disaster, it is still unclear how these very same bots, which assisted in locating COVID-19 vaccinations and treatments across the country, contributed to a catastrophe that almost brought down a major superpower that was just beginning to recover. Regardless of how the crisis unfolds, will the world continue to gradually advance toward establishing a society in which robots effectively hold human life at ransom?

Disclaimer: The views expressed in this article are those of the author and do not necessarily reflect the views of the Economic Times – ET Edge Insights, its management, or its members

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