I have looked into this situation a little more. It would appear there is a really crooked path with many moving parts along the way that has led us to this day.
In broad strokes, it seems there are 4 major manufacturers of baby formula in the US who control about 90% of the market. When one of these four stops production that leaves the market with about a 20% shortage of baby formula.
How did we get here and why are the businesses whining about Federal regulations? If anyone recalls the demise of such as the regional meat processors and the local tire retailers who also produced recapped tires, it was the big boys selling new tires and large meat packers who sent lobbyist to Washington to seek more stringent regulations for their respective industries. The rational was the cost of compliance with the new regs would force most of the regional meat processors out of business as well as force tire retailers to stop recapping tires. The cost for their compliance with the regs requested by these large businesses would be more than made up by the increases in sales due to less competition. Is the baby formula business really any different?