*

Verdict is victory for the companies after large losses in

similar lawsuits

*

Reckitt shares jump 10% after the verdict

*

Plaintiff's lawyers sought award of over $6.2 billion

(Updates Oct. 31 story with Reckitt, Abbott shares in paragraph

3, analysts' quotes in paragraphs 4, 9-11)

By Brendan Pierson

Nov 1 (Reuters) - Abbott and Reckitt

unit Mead Johnson are not responsible for a young boy's

debilitating intestinal disease, a jury found on Thursday in a

lawsuit accusing them of failing to warn of their premature baby

formulas' risks.

The ruling is a victory for the two companies following

large losses in similar trials.

London-listed Reckitt's shares jumped 10% to 51.70 pounds in

early trade on Friday, set for its best day since 2009. Abbott

shares had risen 5.4% in after-hours U.S. trading on Thursday.

"The probability of a high pay-out has reduced, driving the

positive move in the share price this morning," Tineke Frikkee

of Waverton Investment Management, a Reckitt shareholder said.

At the five-week trial in St. Louis, Missouri state court,

lawyers for plaintiff Kaine Whitfield had urged jurors to award

more than $6.2 billion.

"The decision reinforces what we, the medical community and

regulatory bodies have said: that preterm infant nutrition

products are safe," Abbott said in a statement.

Mead Johnson said the verdict "demonstrates that the claims

in this case were not supported by the science or experts in the

medical community."

A lawyer for Whitfield did not immediately respond to a

request for comment.

"This is the first positive outcome in this action for Mead

Johnson and Abbott, and could lessen concerns on final

settlement liabilities," analysts at Jefferies said in a note.

The brokerage sees Reckitt's stock recovering somewhere

between Thursday's close and the pre-litigation headlines price

of 53 pounds per share.

That implies a 13% rise from Reckitt's last closing price.

The lawsuit, brought on Kaine's behalf by his mother,

Elizabeth Whitfield, alleged that the companies failed to warn

that their specialized formulas used by newborn intensive care

units in hospitals could cause necrotizing enterocolitis, a

disease that almost exclusively affects premature infants and

has an estimated mortality rate of more than 20%.

Kaine, now seven years old, was born prematurely at less

than 28 weeks, weighing just over 1,000 grams or 2.2 pounds, and

developed the disease after being fed formula at St. Louis

Children's Hospital. He had surgery for his illness and

survived, but will have lifelong developmental and health

problems as a result, according to the lawsuit.

The hospital was also a defendant in the lawsuit, and was

found not liable by the jury.

Reuters watched the trial through Courtroom View Network.

SIMILAR LAWSUITS

The case is one of about 1,000 similar lawsuits around the

country, which have raised alarm from doctors who say the

litigation could threaten the formulas' availability or affect

medical decisions.

Abbott CEO Robert Ford told investors in an Oct. 16 call

that it would be "very difficult for any company to remain on

the market with these products" in the face of "indefinite

liability." Reckitt in July said it was "considering options"

for Mead Johnson, and CEO Kris Licht did not rule out a sale.

Abbott and Mead Johnson have said that, while mother's and

donated human milk protect against necrotizing enterocolitis,

formula does not cause it. The companies have said that the

benefits of human milk are widely known and incorporated into

hospital feeding practices.

Two cases that went to trial earlier this year resulted in

verdicts of $60 million against Mead and $495 million against

Abbott. The latter verdict was before the same St. Louis judge

as Whitfield's case.

Following the earlier verdicts, U.S. regulatory agencies and

a working group of scientists convened by the National

Institutes of Health said current evidence does not support the

hypothesis that formula causes necrotizing enterocolitis. Abbott

and Mead were not allowed to present those statements to the

jury in the latest trial.

(Reporting By Brendan Pierson in New York; Additional reporting

by Yamini Kalia in Bengaluru and Anousha Sakoui in London;

Editing by Alexia Garamfalvi, David Gregorio and Emelia

Sithole-Matarise)