The Ministry for Primary Industries says it will take action against baby formula marketer Fernbaby if the company continues to make "therapeutic claims" about its products.
The Auckland-based firm is under fire for questionable marketing, including a testimonial on its website that suggested its formula had cured a baby's asthma and bronchitis.
The website was taken offline following a Business Herald report this week.
In the testimonial, "Gina" stated that her daughter had battled severe asthma and bronchitis since she was 6 weeks old, resulting in her being hospitalised on a number of occasions.
"For 5 weeks with Fernbaby my daughter has not had a single wheeze and her three asthma inhalers are lying untouched on the kitchen bench," it said.
Today, a Ministry for Primary Industries spokeswoman said the testimonial was considered a therapeutic claim under the Australia New Zealand Food Standards Code.
"This claim implies that the product treats or cures a serious disease," she said.
"Therapeutic claims on foods are prohibited in New Zealand."
MPI noted that Fernbaby's website had been shut down.
"We will continue to monitor this and if the website is reinstated with the therapeutic claim, MPI will investigate and take appropriate action," the spokeswoman said.
Fernbaby's products are stocked in a number of Auckland supermarkets.
They are also sold in China.
Jan Carey, chief executive of the Infant Nutritional Council, whose members include major formula manufacturers such as Fonterra and Synlait, slammed the testimonial this week.
"Infant formula companies have a responsibility because they are providing a sole source of nutrition for the most vulnerable in the population and one mother's anecdote is not scientific evidence and it's just not appropriate to put a statement like this on their website," Carey said.
Fernbaby, whose products are manufactured externally by New Zealand-based contract manufacturers, is majority owned by Chinese businessman Tianxi Shao, according to Companies Office records.
Company spokesman John McCaulay told the Business Herald on Monday that the website was being taken down "to make the appropriate deletions".