NEW YORK - Pharmaceutical giant Johnson & Johnson said Tuesday it would stop selling talc-based baby powder in the United States and Canada, where sales had already been hit by changing consumer habits and fears the product causes cancer.
The company has long denied claims that the talc powder it uses contains cancer-causing asbestos, but has nonetheless been taken to court several thousands of times over the allegations.
In a statement, Johnson & Johnson said it remained "steadfastly confident" in the product's safety and would "vigorously" defend against the lawsuits, noting that all guilty verdicts passed against the company have been overturned.
"As part of a portfolio assessment related to COVID-19, in March, Johnson & Johnson Consumer Health stopped shipping hundreds of items in the US and Canada to prioritize high-demand products and to allow for appropriate social distancing in manufacturing and distribution facilities," the statement said.
It then decided to discontinue around 100 products in the 2 countries, including the talc-based powder.
"Demand for talc-based Johnson's Baby Powder in North America has been declining due in large part to changes in consumer habits and fueled by misinformation around the safety of the product and a constant barrage of litigation advertising," the company said.
Existing stocks of the powder will be sold in the US and Canada until they run out, the company said, and the product will remain for sale in countries where there is "significantly higher consumer demand."
Agence France-Presse
Johnson & Johnson said Tuesday that it did not find asbestos in multiple tests of a bottle of baby powder that the Food and Drug Administration said contained trace amounts of the carcinogen.
The company had recalled 33,000 bottles of the product earlier this month after the regulator said it discovered evidence of chrysotile asbestos in a bottle bought from an online retailer. Johnson & Johnson said 15 new tests of that very bottle came up clean.
Another 48 tests of samples from the recalled lot, conducted by two third-party labs, reached the same conclusion, the company said. Johnson & Johnson is facing lawsuits from more than 15,000 plaintiffs who claim that the company’s baby powder and other talc-based products caused their cancer.
“We stand by the safety of our product,” the company said in a statement. Johnson & Johnson’s shares rose in after-hours trading Tuesday afternoon.
The company said it contacted the two labs after the recall to expedite tests of the baby powder in question. Three samples did initially test positive for asbestos, the company said in Tuesday’s statement, but after an investigation by the lab, the contamination was found to be coming from a portable air conditioner in the room.
“This finding underscores the importance of investigating any positive test result,” the company said, adding that “even when careful safeguards are followed, asbestos contamination may be introduced during sample division, storage, preparation and analysis.”
For decades, Johnson & Johnson has cast doubt on multiple findings of asbestos in its talc products, blaming poorly executed tests, unqualified scientists, similar-looking minerals and other factors. The company said that it “routinely” uses “a rigorous testing standard” to check its talc.
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Johnson & Johnson said on Friday it is recalling around 33,000 bottles of baby powder in the United States after US health regulators found trace amounts of asbestos in samples taken from a bottle purchased online.
J&J shares fell more than 6 percent to close at $127.70.
The move marks the first time the company has recalled its iconic baby powder for possible asbestos contamination, and the first time US regulators have announced a finding of asbestos in the product. Asbestos is a known carcinogen that has been linked to deadly mesothelioma.
The recall is the latest blow to the more than 130-year-old US healthcare conglomerate that is facing thousands of lawsuits over a variety of products, including baby powder, opioids, medical devices and the antipsychotic Risperdal.
A jury last week ordered the company to pay $8 billion to a plaintiff in a case claiming J&J downplayed the risks of Risperdal. That award is not expected to stand, the company and legal experts have said.
J&J faces more than 15,000 lawsuits from consumers claiming its talc products, including Johnson's Baby Powder, caused their cancer.
On a conference call with reporters on Friday, Dr. Susan Nicholson, head of Women’s Health in the company's medical safety organization, called the asbestos finding "extremely unusual," adding that it was "inconsistent with our testing to date."
The voluntary recall announced on Friday is limited to one lot of Johnson's Baby Powder produced and shipped in the United States in 2018, the company said.
J&J in a news release said that testing by the US Food and Drug Administration as recently as a month ago found no asbestos in their talc.
The FDA said in a statement that the latest sampling took place during its testing for asbestos in talc-containing cosmetics that it began reporting this year. A second Johnson’s Baby Powder sample from a different lot tested negative for asbestos, the agency said.
The FDA said it stands by the quality of its testing and results and recommended consumers stop using the product if it comes from the affected lot.
J&J said on the conference call that it received a report from the FDA on Oct. 17 alerting the company about the asbestos finding. It said it has started an investigation and is reviewing manufacturing records and collecting data on the distribution of the lot to determine where the product was shipped.
J&J added that it is working with the FDA to determine the integrity of the tested sample as well as the validity of test results.
THOROUGH INVESTIGATION NEEDED
The type of asbestos discovered by FDA testing has not been found in the mine where the company sources its talc, J&J's Nicholson said. She described it as an environmental contaminant most commonly found in building materials and industrial applications.
J&J said it was too early to confirm whether cross-contamination of the sample had caused a false positive, whether the sample was taken from a bottle with an intact seal or whether it was prepared in a controlled environment. It added that it could not confirm whether the tested product was authentic or counterfeit.
"It is so critical that we perform a thorough investigation of the sample to determine the source of contamination," Nicholson said.
Since 2003, talc in Johnson's Baby Powder sold in the United States has come from China through supplier Imerys Talc America, a unit of Paris-based Imerys SA and a co-defendant in much of the talc litigation. Imerys and J&J said the Chinese talc is safe.
J&J has known for decades that asbestos lurked in its talc, Reuters reported last year. Internal company records, trial testimony and other evidence show that from at least 1971 to the early 2000s, the company’s raw talc and finished powders sometimes tested positive for small amounts of asbestos. Company executives, mine managers, scientists, doctors and lawyers fretted over the problem and how to address it, while failing to disclose it to regulators or the public, Reuters found.
J&J has repeatedly said that its talc products are safe, and that decades of studies have shown them to be asbestos-free and that they do not cause cancer.
The FDA test indicated the presence of no greater than 0.00002 percent of chrysotile asbestos in the tested sample, J&J said.
The World Health Organization and other authorities recognize no safe level of exposure to asbestos. While most people exposed never develop cancer, for some, even small amounts of asbestos are enough to trigger the disease years later.
Thousands of the lawsuits against J&J have been consolidated before a New Jersey federal judge, who is currently weighing company motions to disqualify plaintiffs’ expert witnesses, including the head of an asbestos testing lab who has testified in earlier trials that he found the contaminant in J&J powders.
Leigh O’Dell, one of the lead plaintiff attorneys, on Friday said the recall "vindicates the position we’ve been taking for months.”
Wells Fargo analyst Larry Biegelsen said in a research note that the recall could encourage additional lawsuits and prompt the company to pursue a broader settlement.
Jefferies healthcare strategist Jared Holz said J&J has already lost close to $10 billion in market value due to the talc issue over the past year.
He said further downside to J&J stock is likely to be limited because legal concerns over talc are well known and have already taken a toll on the share price. "This is one single bottle within one lot with barely a trace here," he said.
J&J said in February that it had received subpoenas from the US Justice Department and the Securities and Exchange Commission for documents related to the asbestos contamination allegations. A Bloomberg report, which Reuters has confirmed, said those inquiries include a criminal grand jury investigation into how forthright J&J has been in its statements about the safety of its powders.
While talc products make up less than 1 percent of J&J sales expected by analysts to reach $82 billion in 2019, the New Jersey-based healthcare-products maker considers its Baby Powder to be an essential facet of a carefully tended image as a caring company.
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A Missouri jury on Thursday ordered Johnson & Johnson to pay a record $4.69 billion to 22 women who alleged the company's talc-based products, including its baby powder, contain asbestos and caused them to develop ovarian cancer.
The verdict is the largest J&J has faced to date over allegations that its talc-based products cause cancer. J&J is battling some 9,000 talc cases.
Thursday's massive verdict, handed down in the Circuit Court of the City of St. Louis, was comprised of $550 million in compensatory damages and $4.14 billion in punitive damages, according to an online broadcast of the trial by Courtroom View Network.
J&J shares fell $1.31, or 1 percent, to $126.45 in after-hours trading following the punitive damages award. They had risen $1.52 during regular trading.
The jury's decision followed more than 5 weeks of testimony by nearly a dozen experts on both sides.
The women and their families said decades-long use of Baby Powder and other cosmetic talc products caused their diseases. They allege the company knew its talc was contaminated with asbestos since at least the 1970s but failed to warn consumers about the risks.
J&J denies both that its talc products cause cancer and that they ever contained asbestos. It says decades of studies show its talc to be safe.
"Johnson & Johnson is deeply disappointed in the verdict, which was the product of a fundamentally unfair process," the company said in a statement. The company said it remained confident that its products do not contain asbestos or cause cancer.
"Every verdict against Johnson & Johnson in this court that has gone through the appeals process has been reversed and the multiple errors present in this trial were worse than those in the prior trials which have been reversed," J&J added, saying that it would pursue all available appellate remedies.
Mark Lanier, the lawyer for the women, in a statement following the verdict called on J&J to pull its talc products from the market "before causing further anguish, harm, and death from a terrible disease."
"If J&J insists on continuing to sell talc, they should mark it with a serious warning," Lanier said.
The majority of the lawsuits that J&J faces involve claims that talc itself caused ovarian cancer, but a smaller number of cases allege that contaminated talc caused mesothelioma, a tissue cancer closely linked to asbestos exposure.
The cases that went to trial in St. Louis effectively combine those claims by alleging asbsestos-contaminated talc caused ovarian cancer.
Previous talc trials have produced verdicts as large as $417 million. But that 2017 verdict by a California jury, as well as other verdicts in Missouri, was overturned on appeal, and challenges to at least another five verdicts are pending.
The US Food and Drug Administration commissioned a study of various talc samples from 2009 to 2010, including of J&J's Baby Powder. No asbestos was found in any of the talc samples, the agency said.
But Lanier during the trial told jurors that the agency and other laboratories and J&J have used flawed testing methods that did not allow for the proper detection of asbestos fibers.
Talc, the world's softest rock, is a mineral closely linked to asbestos and the 2 substances can appear in close proximity in the earth.
Plaintiffs claim the 2 can become intermingled in the mining process, making it impossible to remove the carcinogenic substance. J&J denies those allegations, saying rigorous testing and purification processes ensure its talc is clean.
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A California jury on Thursday ruled in favor of Johnson & Johnson in a lawsuit by a woman who said she developed the cancer mesothelioma after being exposed to asbestos in the company's talc-based products including J&J's Baby Powder.
The Los Angeles Superior Court jury's verdict came in the first trial centering on claims that J&J's talc products contained asbestos. J&J is separately battling thousands of cases claiming those products can also cause ovarian cancer.
The verdict came in a lawsuit by Tina Herford, who said she developed mesothelioma after using J&J talcum powder products that her lawyers claimed contained asbestos.
Reuters watched the verdict through an online broadcast by Courtroom View Network. The jury also found in favor of talc supplier Imerys Talc.
J&J in a statement welcomed the verdict. J&J said it believed that setbacks dealt to individuals pursuing ovarian cancer cases had "forced plaintiff attorneys to pivot to yet another baseless theory."
"Johnson's Baby Powder has been around since 1894 and it does not contain asbestos or cause mesothelioma or ovarian cancer," J&J said.
Chris Panatier, Herford's lawyer, in an email cautioned against reading too much into a single verdict.
"It is a matter of time before juries begin holding them to account," he said.
The verdict came as a federal jury, separately, ordered J&J to pay $247 million to six patients who said they were injured by defective Pinnacle hip implants.
Mesothelioma is a deadly form of cancer closely associated with exposure to asbestos. It affects the delicate tissue that lines body cavities, most often around the lungs, but also in the abdomen and elsewhere.
Herford's lawyers contended that internal J&J documents showed the New Jersey-based company for decades was aware of the presence of asbestos in the talc that was used in its products but kept selling them anyway.
J&J faces lawsuits by around 5,500 plaintiffs nationally asserting talc-related claims, largely based on claims it failed to warn women about the risk of developing ovarian cancer from the products.
In 5 trials in Missouri involving ovarian cancer lawsuits, juries found J&J liable 4 times and awarded the plaintiffs $307 million. In California, a jury awarded a now-deceased woman $417 million.
But in October, J&J scored major victories when a Missouri appellate court threw out the first verdict there for $72 million and a California judge tossed the $417 million verdict.
The case is Herford et al v. AT&T Corp et al, Los Angeles Superior Court, No. BC646315.
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A California judge on Friday threw out a $417 million verdict against Johnson & Johnson in a lawsuit by a woman who claimed she developed ovarian cancer after using its talc-based products like Johnson's Baby Powder for feminine hygiene.
The ruling by Los Angeles Superior Court Judge Maren Nelson marked the latest setback facing women and family members who accuse J&J of not adequately warning consumers about the cancer risks of its talc-based products.
The decision followed a jury's decision in August to hit J&J with the largest verdict to date in the litigation, awarding California resident Eva Echeverria $70 million in compensatory damages and $347 million in punitive damages.
Nelson on Friday reversed the jury verdict and granted J&J's request for a new trial. Nelson said the August trial was underpinned by errors and insufficient evidence on both sides, culminating in excessive damages.
Mark Robinson, who represented the woman in her lawsuit, in a statement said he would file an appeal immediately.
"We will continue to fight on behalf of all women who have been impacted by this dangerous product," he said.
J&J in a statement said it was pleased with the verdict, adding that it will continue to defend itself in additional trials.
The judge added that there also had been misconduct of the jury during the trial.
J&J said declarations by two jurors after the trial showed that three members of the 12-person jury who voted against finding the company liable were improperly excluded from determining damages.
J&J says it faces lawsuits by 4,800 plaintiffs nationally asserting talc-related claims. Many of those cases are in California, where Echeverria's case was the first to go to trial, and in Missouri, where J&J has faced five trials.
The Missouri litigation led to four verdicts against J&J in which juries issued verdicts totaling $307 million. The company has only won one trial.
But the Missouri cases, which have largely been brought by out-of-state plaintiffs, have faced jurisdictional questions after the Supreme Court issued a ruling in June that limited where personal injury lawsuits could be filed.
On Tuesday, a Missouri appellate court threw out a $72 million verdict by a jury in February 2016 to the family of a deceased Alabama woman after ruling the case should not have been tried in St. Louis.
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