Justice Department, SEC subpoenas put J&J's talc woes under federal microscope

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U.S. Sen. Patty Murray has said she was 'troubled' by reports that J&J knew its talc powder contained asbestos. (United States Senate)

Last month, a prominent U.S. senator asked Johnson & Johnson to turn over documents related to asbestos testing at the center of a set of lawsuits linking its iconic baby powder to cancer. But a new J&J disclosure shows it has bigger problems on its hands.

The New Jersey drugmaker has received subpoenas from the Department of Justice and the Securities Exchange Commission seeking documents connected to the product, the company said Wednesday in a securities filing. Sen. Patty Murray publicly requested similar documents last month.

The demands step up the scrutiny on J&J and its talcum powder products at a time when the company faces more than 13,000 lawsuits claiming those products caused their cancers. So many plaintiffs have piled onto that litigation that J&J's primary talc supplier fled into bankruptcy protection last week.

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J&J has fiercely denied any link between its talc products and cancer. In the SEC filing, it said it is “cooperating with these government inquiries and will be producing documents in response.”

RELATED: Johnson & Johnson says talc products have always been asbestos-free. Court documents suggest otherwise

The disclosure follows a January letter from Sen. Murray, the ranking member of the Senate Committee on Health, Education, Labor and Pensions, to the pharma giant. In it, she wrote that she was “troubled” by a Reuters report late last year stating that J&J had known about and covered up the presence of asbestos in its talc for decades.

She requested a response from the company by Feb. 11, including all of the company’s communications with the FDA on the subject, dating back to 1966. The Reuters report was based in part on documents filed by plaintiffs in the cancer lawsuits, including internal emails and testing information.

The new developments rub salt in the wound for J&J, whose CFO Joe Wolk said in January wishes the December Reuters report “did not come out.” But that doesn’t mean it’s backing down on its assertion that it did nothing wrong.

RELATED: What to do when an exposé tanks your stock? For J&J, you go direct to consumers

"The conviction could not be stronger" that its baby powder is safe, he said at the J.P. Morgan Healthcare Conference. "Our company’s position is based on tens of thousands of men and women that have been in clinical trials,” he pointed out, pledging that "we’re going to continue to defend what we know to be a safe product."

Murray, however, has zeroed in on the wording of J&J's public defense. J&J has edited some materials to indicate that its talc may not have always been asbestos-free, the senator pointed out. Murray wants J&J to respond by Feb. 11 to show how it can say its talc is now asbestos-free and why it can’t say that was always the case. 

Murray wants to “understand more about efforts by Johnson & Johnson to determine whether there were possible carcinogens in its baby power and how it presented that information to regulators and consumers,” she said, adding that it’s “unclear whether the company disclosed to the FDA that some of its tested samples contained contaminants.”

Johnson & Johnson has suffered some costly losses in the talc litigation, where case counts continue to mount. The healthcare giant has been able to overturn many of those losses on appeal, but last summer, it suffered its biggest defeat to date. A jury ordered the company to pay a whopping $4.69 billion verdict after a trial that combined the claims of 22 women. J&J has pledged to appeal.

Meanwhile, the company faces a variety of lawsuits stemming from the talc litigation, including shareholder class actions and employee benefits claims, the SEC filing said.

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