For years, J&J has defended against lawsuits linking its talcum powder to cancer by saying the products are safe and don't contain asbestos. But Friday, J&J issued a recall, saying the FDA had found sub-trace amounts of asbestos in one baby powder bottle.
J&J said it is recalling one lot of the product “out of an abundance of caution,” after the FDA found “sub-trace” levels, or no greater than 0.00002%, of chrysotile asbestos contamination in a bottle purchased from an online retailer.
The recall sent investors running for the exits. J&J’s shares had plummeted by more than 4% on Friday at press time, wiping away about $16 billion in market value.
It's just the latest in a series of blows for J&J, which is fighting on several legal fronts and confronting billions of dollars in verdicts and potential settlements. The pharma giant faces lawsuits claiming its Risperdal antipsychotic caused boys to grow breasts, its talc products triggered ovarian cancer and mesothelioma, its aggressive marketing played a role in the nationwide opioid epidemic, and its pelvic mesh caused a variety of women's health problems—and that's just in the U.S.
Meanwhile, J&J has started a “rigorous, thorough investigation” into the asbestos found in its powder and will work with the FDA to learn more about the testing result. The company says it has a “rigorous testing standard,” and that for decades, thousands of tests have found no asbestos in the product.
Still, the result will "undermine" J&J's defense against 15,500 lawsuits claiming J&J's talc can cause cancer, University of Michigan business professor Erik Gordon told the New York Times. He said the news will cause J&J to lose more suits or pay more in settlements.
The lot contained 33,000 bottles, a spokesman told the NYT. It's J&J's first-ever talc recall, he added.
The drugmaker suffered some costly losses in court as juries sided with plaintiffs in the talc cases, but so far, it’s appealed every verdict and won every appeal that's been fully adjudicated.
Aside from the talc litigation, J&J faces thousands of lawsuits over opioid marketing, and it's said to be offering $4 billion to settle thousands of claims gathered in Cleveland federal court. An Oklahoma jury last month leveled a $572 million verdict against the company in a case alleging its opioid business fueled that state's addiction crisis; the company has said it would appeal that decision.
Meanwhile, last week, it was hit with an $8 billion verdict in a case claiming its Risperdal antipsychotic caused a young man to grow breasts. The company has said it’s confident that verdict will be overturned. It's one of hundreds of similar cases pending against the drugmaker.
And just yesterday, a group of state attorneys general said J&J had agreed to pay $117 million to settle allegations that it deceptively marketed its transvaginal mesh products.
The litigation is hitting more than just J&J’s pocketbook. J&J laid out $900 million to cover legal costs during the first half of the year alone, Axios reports, and reputation intelligence firm Alva recently found the company holds the second-to-last position among pharma companies, down from the top 10 in previous years.