J&J Shares Fall 6% After Reportedly Knowing Of Asbestos In Baby Powder

Published on: 17 Dec, 2018

Johnson & Johnson (NYSE: JNJ) reportedly knew its talcum baby powder contained asbestos, Reuters said in a report that drove the Company’s shares down by more than 6% on Friday.

Reuters reviewed documents from 1971 to the early 2000’s that showed J&J executives, mine managers, doctors and lawyers were aware the Company’s raw talc and finished powders sometimes tested positive for small amounts of asbestos. Those involved discussed the problem but they did not disclose it to regulators or the public.

Plaintiffs' attorneys out for personal financial gain are distorting historical documents and intentionally creating confusion in the courtroom and in the media," Ernie Knewitz, J&J's Vice President of global media relations, told Reuters in an email. "This is all a calculated attempt to distract from the fact that thousands of independent tests prove our talc does not contain asbestos or cause cancer. Any suggestion that Johnson & Johnson knew or hid information about the safety of talc is false."

J&J referred Reuters to its outside lawyers, who rejected Reuters' findings as "false and misleading."

"The scientific consensus is that the talc used in talc-based body powders does not cause cancer, regardless of what is in that talc," Peter Bicks told Reuters in an email. "This is true even if — and it does not — Johnson & Johnson's cosmetic talc had ever contained minute, undetectable amounts of asbestos." He dismissed the tests cited in Reuter's article as "outlier" results.

The Company has faced a wave of lawsuits alleging its talc baby powder products contain asbestos and caused ovarian and other cancers. Some juries have sided with J&J and others have been unable to reach verdicts. A Missouri jury in July ordered J&J to pay USD 4.9 Billion in a case involving 22 women and their families. A judge affirmed the verdict in August and J&J vowed to appeal it.

J&J has filed thousands of documents in court proceedings, though most have been designated as confidential.

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Austin Chiu

Email: Austin@financialinsiders.com

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