Johnson & Johnson reportedly knew about asbestos in baby powder, shares extend drop
A report by the Reuters news service claims Johnson & Johnson knew for decades about the existence of trace amounts of asbestos in its baby powder. The news has sent company shares into a tailspin, suffering their worst sell-off in 16 years.
Johnson & Johnson shares extended declines Monday after an explosive report published by Reuters alleged the company knew about the presence of cancer-causing asbestos in its ubiquitous and iconic baby powder.
| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| JNJ | JOHNSON & JOHNSON | 154.77 | +0.77 | +0.50% |
The report, which alleged that J&J didn’t tell the Food and Drug Administration about at least three tests by three different labs from 1972 to 1975 that found asbestos in its talcum powder, in one case at levels reported as “rather high,” according to internal documents from the company.
In response, J&J lambasted the Reuters article as "one-sided, false and inflammatory" in a statement published on its website.
"Simply put, the Reuters story is an absurd conspiracy theory, in that it apparently has spanned over 40 years, orchestrated among generations of global regulators, the world's foremost scientists and universities, leading independent labs, and J&J employees themselves," the company said in a statement. It said that J&J's baby power is "safe and asbestos free", citing the studies of "more than 100,000 men and women", which they said shows talc does not cause "cancer or asebstos-related disease."
According to Reuters, which said it examined company memos, internal reports and other confidential documents from lawyers for some of the 11,700 plaintiffs claiming the baby powder caused their cancer, from at least 1971 to the early 2000s, the company’s “raw talc and finished powders sometimes tested positive for small amounts of asbestos.”
The earliest mention of tained J&J talc, according to Reuters, occurred in 1957 and 1958 reports by a consulting lab. That continued from various times into the early 2000s, with outside reports yielding similar results. Despite that, in 1976, J&J officials assured FDA regulators that no asbestos was detectable "in any sample" as the agency was weighing limits of asbestos in talc products.
According to Reuters, most internal test reports do not find asbestos.
"However, while J&J's testing methods improved over time, they have always had limitations that allow trace contaminants to go undetected - and only a tiny fraction of the company's talc is tested."
Even while aware of the presence of asbestos, company officials reportedly struggled to figure out how to address it publicly, while simultaneously failing to disclose it to the regulators or to the public.
The company has faced a wave of lawsuits, including two cases earlier this year in New Jersey and California. Juries in those cases awarded big sums to plaintiffs who blamed the talc products for causing their mesothelioma, a type of cancer.
According to Reuters, J&J has said that it will appeal the recent verdicts and has maintained on its platform that its talc is safe.