The authorities are calling for a halt to formula milk powder companies’ aggressive marketing methods, including inducements to hospitals, in response to public concern about the steep rise in prices.
In particular, sponsorship and payment arrangements between manufacturers and private hospitals are “conflict of interest” deals that should be reviewed, they say.
This follows a new report by Singapore’s competition watchdog which found that formula milk powder manufacturers are paying private hospitals to distribute their products to newborns.
Such practices have entrenched brand loyalty and helped propel formula milk powder prices in Singapore to among the highest in the world, said the Competition Commission of Singapore (CCS).
It released its 87-page report yesterday after a year-long inquiry into prices of infant formula.
The CCS said formula milk companies target hospitals to gain a “first-mover” advantage, given that most parents do not switch brands later.
The Ministry of Health shared that it will “strongly encourage” all hospitals providing maternity services to achieve the Baby-friendly Hospital Initiative (BFHI) certification.
This prevents conflicts of interest by prohibiting sponsorship arrangements, and actively encourages breastfeeding.
No private hospital is currently BFHI-certified, although two – Thomson Medical Centre and Mount Alvernia – shared that they were working towards it.
The aggressive tactics by milk powder manufacturers have seen the average price of a 900g tin of formula soar 120 per cent over the last decade.
Much of this, the CCS found, was due to milk powder manufacturers hiking their prices after convincing consumers that they were paying for “premium” and improved formulas.
They continually introduce new ingredients that purport to – among other things – boost mental development and vision. Experts have said there is weak scientific evidence to back such claims.
“What consumers face… are the aggressive marketing and ‘premiumisation’ messages driven by formula milk powder manufacturers, which perpetuate consumers’ belief that the more expensive and the more ingredients there are in the formula milk powder, the higher quality it is,” said the CCS report.
It outlined the strategies of the major formula milk powder manufacturers – Abbott, Mead Johnson Nutrition, FrieslandCampina, Nestle, Danone and Wyeth Nutrition – to persuade parents to shell out for milk powder.
Between 2010 and 2014, the amount they spent on marketing increased 42.4 per cent.
A significant share went to private hospitals, which receive sponsorships and “monetary contributions”. In return, they lengthen the period during which certain brands are offered to new parents as the default formula.
The companies did not respond to queries by press time. Only one, FrieslandCampina, replied to say it is studying the report.
