NestléEvidence of violations of the International Code of Marketing of Breastmilk Substitutes and subsequent resolutions

Peter Brabeck-LetmatheChairman/CEOCEO Designate – Paul Bulcke (with effect from April 2008)Nestlé S.AAvenue Nestlé 55CH-1800 Vevey, SwitzerlandTel: +41 21 924211Fax: +41 21 9242813Website: www.nestle.com

Ppoducts include–Infant formula: Pre Nan, Nan 1, Nan H.A. 1, NAN AR, Lactogen 1, Beba 1, Nestogen 1, Guigoz 1, Good Start, Nidina, Nidal, Aletemil, Nativa, Alfaré 1, Alsoy 1, AL110, Alprem, Pelargon, Sinlac, FM85, Nestargel

Follow-up formula: Nan 2, Nan H.A. 2, Lactogen 2, Beba 2, Guigoz 2, Nestogen 2, Nidina 2, Alsoy 2

Complementary food: Alete, Cerelac, Mio Nestum, Nestlé Rice, Nestlé Cereal, Nestlé Prima Infanzia,

logos & icons–

Brea

kin

g t

he

ru

les

2007

stret

ch

ing t

he

ru

les

Nestlé, the market leader in infant nutrition, towers over its competitors with an estimated 28 percent of the market. Company billboards around the world proudly

proclaim “Good Food, Good Life” but its reputation is not so good where the marketing of baby foods is concerned and the company battles with an ongoing boycott of its products in 20 countries.

In 2006, Nestlé Nutrition chalked up sales of 6 billion Swiss francs (US$5.1 billion), marking strong gains in infant nutrition with the launch of NAN H.A..

In April 2007, Nestlé achieved its long cherished goal of acquiring Gerber from pharmaceutical giant Novartis. The acquisition was completed in September 2007. With Gerber in its fold, Nestlé gets an increased market share in the US, since Gerber dominates the US market for complementary food with a 79 percent share. Nestlé called the acquisition of Gerber “a perfect complementary fit”. Gerber is well known for its baby-face logo and persistent direct marketing to mothers.

Nestlé has signalled that it is investing in innovations for infant nutrition products. In December 2006, it announced an exclu-sive agreement with a Danish biotech company for research and development into the use of human milk oligosaccharides in infant nutrition products.

In May 2006, the U.S. Food and Drug Administration (FDA), rejected an attempt by Nestlé USA to put a claim on Good Start Supreme infant formulas which would have implied that the product reduces the risk of some food allergy symptoms. Nestlé could not provide evidence for such a claim. Later in November 2006, the U.S. FDA warned Nestlé that a sample of its Good Start formula failed to meet the minimum nutrition standards for calcium and phosphorus.

In 2005, Italian police seized more than two million litres of Nidina formulas that were contaminated with the chemi-cal isopropylthioxanthone, a fixative of printing ink used on the packaging. It turned out the company knew about the contamination for months, but did not recall the products. In the same year, Nestlé was fined €3.3 million by the antitrust authority of Italy for price-fixing activities, where it imposed excessively high prices for its products in collusion with other baby food companies.

See BTR 2007: Gerber for evidence of its Code violations.

Nestlé’s interpretation of the International Code is set out in “Nestlé’s Instructions for Implementation of the WHO Code”. This manual for its employees, agents and distributors was revised in 2004.ICDC has compared the “Instructions” with the International Code and found them to fall short. See ICDC’s analysis of the IBFAN website, under the section on Code Watch: Focus Papers on Companies and Issues.

Violations are listed under different provisions of the Code and then in alphabetical order by country.

In some hospitals in China, babies are ‘branded from birth’ with identification tags bearing the Nestlé name and logo.