I would use "In its original formulation" because it is more contextually correct.
On and in have many nearly identical definitions, and thus are many times used interchangeably, but as prepositions they still retain distinct meanings. One of the many definitions of 'in' reads
expressing inclusion or involvement
which I think fits best in this instance, because you wish to express a situation that took place within the context of the original formulation (i.e. it is included in the original formulation).
The most relevant definitions of 'on' that I could find for this issue read could be either of the follwing:
2 forming a distinctive or marked part of (the surface of something)
3 having (the thing mentioned) as a topic
6 having (the thing mentioned) as a medium for transmitting or storing
The problem with definition 2 is that it is mostly used when (as the parenthetical note specifies) when describing something on the surface of something else. For example, I was scratched on my arm.
Definition 3 indicates that the second noun is the subject of the preceding noun. For example, one could say The book on ornithology was interesting. Here, ornithology is the subject of the book. In your sentence, the method is not the subject of the formulation.
The final definition could only be used if the formulation was the mechanism by which the method performed its purpose or something of that nature, which is false.
*definitions from the New Oxford American Dictionary