A story on Pharmalot reports a settlement of $23 million dollars against Johnson & Johnson for issues caused by their Fort Washington, Pennsylvania plant and its over-the-counter business as a whole. After practices at the Fort Washington plant resulted in numerous product recalls and a variety of quality control issues, shareholders filed a class action lawsuit over J&J’s poor managerial performance. The lawsuit alleged that management caused a decline in market share, congressional probes, and a loss of consumer confidence in the company. The lawsuit also cited that corporate cost cutting led to neglect of quality control. Other charges included mismanagement of the OTC branch and a poor integration of the Pfizer consumer health acquisition.
The lawsuit also alleged that J&J withheld material information before deciding to shut down the Fort Washington plant three years ago. This plant was the site of contamination that led to a recall of defective Motrin tablets in 2009.
J&J agreed to increase internal oversight as a result of the settlement. Although the company did not admit any wrongdoing on its part, the company’s chief financial officer implied that the Fort Washington plant had been lacking, stating that the plant, “has been completely redesigned, consistent with the other manufacturing facilities in the J&J network, and we now have a quality management system that runs across our J&J facilities.”
Lopez McHugh will continue to monitor reports from the Fort Washington Plant and other J&J pharmaceutical products.