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The New Zealand Food Safety Authority is advising parents using two brands of infant formula to gradually change to alternative products.
New Zealand Food Safety Authority (FSA) acting chief executive Andrew McKenzie said Nutricia Karicare Gold Plus infant formula and Karicare Follow-on formula contained an additive that could cause "softer, looser and more frequent bowel movements". Click here for FSA statement.
Nutricia's managing director, Toni Brendish, said the authority had taken an alarmist approach.
"We've had this particular formula subjected to over 15 trials. It's a permitted food ingredient and was safety assessed back in 2001," Ms Brendish said.
She said the additive gave "more regular stools, less constipation, and bowel motions more like those of a breast fed infant".
The FSA said Fructo-oligosaccharides (FOS), a chain of sugar molecules which occured naturally in bananas, onions and barley, had not been subjected to a New Zealand risk-based safety assessment.
It had been approved in the European Union for addition in restricted amounts to infant formula (for babies up to six months) and follow-on formula (for babies between six and 12 months). Infant and follow-on formula products containing FOS have been sold in the EU for seven years.
FSA spokesman Gary Bowering said the authority did not have the power to pull the product from shelves unless they could prove it posed a danger to consumers.
"We don't have that," he said.
Mr Bowering said although the additive was found in plants, it was not found in breast milk.
"This company is using the New Zealand population as a test market," he claimed.
However, Ms Brendish said the formula had been on supermarket shelves in Europe since 2001, consumed by over 10 million babies world-wide and was present in other baby formulas.
"It's a huge disappointment on our part. We've been working with New Zealand food and safety for many months on this and arranged that we would jointly go to court to seek a declaration on this particular ingredient," she said.
Ms Brendish said consumers were calling the company with concerns the product wasn't safe.
She said the issue had cost the company money and it was "reviewing its legal options".
Mr Bowering said the authority's move was intended to protect one of the most vulnerable groups in society who might rely on the formula for their sole source of nutrition.
The FSA said parents wanting to change formulas should do it gradually because a sudden change could cause stomach upsets.
It recommended phasing out the products by replacing one to two feeds a day over three to four days.
The New South Wales Food Authority has also warned the company that it might have breached the food standards code.