McNeil Consumer Healthcare reaches consent decree with FDA

After numerous recalls and heated congressional hearings, the FDA is taking action against beleaguered Johnson & Johnson unit McNeil-PPC. The agency announced Thursday it has finalized the terms of a consent decree against the J&J unit and two of its officers for failing to comply with current good manufacturing practice requirements. McNeil's VP of Quality and VP of Operations for OTC Products also were named defendants in the consent decree that was filed with the U.S. District Court for the Eastern District of Pennsylvania in Philadelphia.

McNeil says it will continue to operate the facilities in Pennsylvania and Las Piedras, Puerto Rico and will work with an independent expert who will inspect these sites and issue recommendations. The company then will develop remediation plans to address the expert's observations and submit them to the FDA. "[T]here is the potential for some impact [in production] initially as we implement the additional steps," says McNeil spokeswoman Bonnie Jacobs, as quoted by CNNMoney.

"This is a strong, but necessary, step to ensure that the products manufactured by this company meet federal standards for quality, safety and purity," Deborah Autor, director of the Office of Compliance in the FDA's Center for Drug Evaluation and Research, stresses in a statement. And to emphasize it is serious, the FDA says that if the defendants violate the decree, it may order McNeil to cease manufacturing, recall products and take other corrective action, including levying fines of $15,000 for each day and an additional $15,000 for each violation of the law, up to $10 million annually.

Manufacturing deficiencies at McNeil's facilities have resulted in several extensive recalls, including an April 30, 2010, recall of lots of several liquid products such as children's Tylenol, Motrin, Zyrtec and Benadryl products. In January 2010, the FDA issued a warning letter to McNeil's Consumer Healthcare Division regarding violations identified at McNeil's Las Piedras facility.

But this consent decree may add to the company's woes after recalls lowered sales by $900 million last year, Miller Tabak & Co.'s Les Funtleyder told Bloomberg. "Why has it taken so long to remediate all of these issues?" Funtleyder asked. "Now that the FDA is there, it's going to make things worse."

- read the McNeil statement
- see the FDA's statement
- check out more from CNNMoney
- get more from Bloomberg

Special Report: Pharma manufacturing consent decrees: 16 black holes

Suggested Articles

Six pharmaceutical execs are set to head to Washington next week for pricing hearings at the House Committee on Oversight and Reform. 

After sifting through the data, one analyst figures the latest Opdivo-Keytruda showdown in kidney cancer might come down to commercial execution.

Biogen is giving former chief finance officer Jeff Capello a multimillion-dollar cash payment plus other severance benefits.