After damaging Reuters report, J&J doubles down on talc safety message By Reuters

By Mike Spector and Lisa Girion

NEW YORK/LOS ANGELES (Reuters) – Johnson & Johnson (NYSE:) Inc’s assertion was unequivocal.

“The FDA has tested Johnson’s talc since the ’70s. Every single time it did not contain asbestos,” the corporate mentioned in a Dec. 19 tweet. It adopted by a number of days the publication of a Reuters investigation (https://www.reuters.com/investigates/special-report/johnsonandjohnson-cancer/) that discovered the healthcare conglomerate knew for many years that the carcinogen lurked in its Baby Powder and different beauty talc merchandise.

The tweet, posted beneath the deal with @JNJNews, did not point out that the U.S. Food and Drug Administration (FDA) discovered traces of asbestos within the firm’s Shower to Shower talc in 1973, as revealed in company paperwork https://www.documentcloud.org/documents/5669405-2017-J-J-witness-on-FDA-finding-asbestos-in.html reviewed by Reuters. And it’s only one in every of dozens of tweets conveying the same message about talc safety for the reason that Reuters article appeared Dec. 14.

The Reuters article prompted a stock selloff that erased about $40 billion from J&J’s market worth in someday and created a public relations disaster because the blue-chip healthcare conglomerate confronted widespread questions in regards to the potential health results of one in every of its most iconic merchandise.

To reassure buyers and customers, J&J has tweeted, posted on Facebook (NASDAQ:), run a sequence of full-page newspaper advertisements throughout the United States, revealed a prolonged rebuttal to the Reuters investigation on its web site and introduced a $5 billion stock buyback. Chairman and Chief Executive Officer Alex Gorsky has appeared in an organization video and on CNBC’s “Mad Money” to bolster the corporate’s place.

That place has been unwavering. J&J insists that its Baby Powder is protected and has been asbestos-free at the least since common testing started within the 1970s. The message doubles down on the stance the corporate has taken to defend towards lawsuits by which about 11,700 plaintiffs allege that the J&J talc they utilized in previous many years precipitated their most cancers. The firm is pursuing this technique regardless of the proof that talc in its uncooked and completed powders typically examined constructive for the carcinogen from the 1970s into the early 2000s — take a look at outcomes that the corporate didn’t open up to regulators or customers.

In response to a Reuters request for remark, the corporate mentioned it’s dedicated to defending the talc litigation, “and that same, long-term view is reflected in our ongoing communications that consistently point to the strong scientific evidence that our talc is and always has been safe.”

As for the 1973 Shower to Shower take a look at, J&J famous that the consequence did not “reflect FDA’s final determination about this sample” in a 1976 desk summarizing the company’s early 1970s beauty talc testing. However, in that 1976 desk, which Reuters examined, the FDA didn’t point out any consequence, constructive or damaging, for the kind of asbestos discovered within the Shower to Shower pattern in 1973.

Given the mass of litigation it faces, J&J has little alternative however to zealously dispute findings that its merchandise typically contained traces of asbestos, mentioned Eric Dezenhall, a crisis-management advisor in Washington, D.C. “If your position in court is that the claims being made are false…you can’t just shrug your shoulders,” he mentioned.

Soon after the Reuters article appeared, J&J executives consulted crisis-management consultants, in accordance with folks acquainted with the matter. Among the corporate’s causes for deciding to keep up its stance on absolute talc purity, these folks mentioned, was a conviction that an organization recognized for placing health and safety first had the details on its facet, a litigation observe document that included victories and mistrials, and the expectation that antagonistic verdicts shall be overturned on attraction.

THROUGH LAWYERS

Many of J&J’s subsequent messages have mirrored the corporate’s written responses to questions and findings Reuters introduced to the corporate throughout its investigation: They deny that the corporate saved data from regulators and level to the numerous research discovering that talc is protected and would not trigger most cancers.

Those earlier responses have been composed by J&J’s exterior litigators, led by Peter Bicks at Orrick, Herrington & Sutcliffe, and conveyed to Reuters by legal professionals at a crisis-management firm co-founded by Lanny Davis, a lawyer who represented U.S. President Bill Clinton within the 1990s and Michael Cohen, President Donald Trump’s former legal professional who has pleaded responsible to a number of felony fees.

Gorsky, in his look on “Mad Money,” invoked J&J’s now legendary response to the Tylenol disaster as proof that the corporate will be trusted to handle any safety issues linked to its merchandise. In 1982, J&J moved decisively to tug all Tylenol from retailer cabinets after seven folks died from taking cyanide-laced drugs.

“I can’t believe the company that took that dramatic of an action would allow a product that they felt in any way could be harmful to stay on the market,” Gorsky instructed “Mad Money” host Jim Cramer. “We unequivocally believe that our talc, our Baby Powder, does not contain asbestos.”

Citing the Tylenol recall supplies “some reputational buffer,” mentioned Stephen A. Greyser, the Harvard Business School professor who wrote the primary examine of the corporate’s dealing with of that disaster. “But it is not a total protection” as a result of it will not protect the corporate from a loss of belief if customers or buyers conclude the corporate hasn’t been totally forthcoming on this case, he mentioned. J&J wants to protect towards “reputational contagion,” the chance {that a} loss of confidence in Baby Powder may bleed over into how customers, shareholders and others view the corporate extra broadly, Greyser added.

The key distinction between the 2 crises is that poisoned Tylenol introduced a menace to customers on the time, whereas the documented asbestos contamination of J&J talc that Reuters investigated spanned from 1971 to the early 2000s. J&J says that if it believed that Baby Powder right now introduced safety dangers, it would not hesitate to take away it from retailer cabinets, on condition that the product accounts for lower than 0.5% of annual income.

The firm joined its talc provider, Imerys Talc America, a unit of Paris-based Imerys SA, in requesting {that a} trial scheduled for January in St. Louis be delayed for, amongst different issues, what they referred to as “negative national and local news coverage” ensuing from the Reuters investigation that may inevitably taint potential jurors.

The choose denied the movement. The identical choose lately upheld a $4.69 billion jury award in a separate ovarian most cancers case, which J&J says it expects to be overturned on attraction. The choose mentioned J&J’s promotion of a product that the proof confirmed was contaminated with a recognized carcinogen was “particularly reprehensible.”

In an emailed assertion, Imerys Talc America mentioned it “is committed to the quality and safety of its products,” and that rigorous analysis “overwhelmingly confirms that talc is safe, and no agency has asserted that talc causes cancer.”

UNDERMINED BY EVIDENCE

Some of J&J’s messages in its current marketing campaign omit key particulars concerning findings on talc and, in sure situations, are undermined by different proof, in accordance with a Reuters evaluate of the corporate’s statements.

The Dec. 19 tweet claiming that the FDA’s personal checks by no means discovered asbestos in J&J talc, for instance, ignores an company scientist’s 1973 discovering {that a} Shower to Shower pattern contained asbestos fibers, in accordance with a replica of an FDA report titled “Asbestos and Other Contaminants in Talc” and a deposition of a former J&J head toxicologist. The FDA didn’t reply to questions for this text, citing a partial authorities shutdown.

On CNBC, Gorsky mentioned: “We also not only used the best testing methodologies that were available, but we continued to improve them through the years.”

J&J’s testing strategies do exceed the business customary. But even so, as a geologist and frequent J&J knowledgeable witness acknowledged in court docket this 12 months, solely a tiny fraction of the corporate’s talc bought over the previous 40 years has been examined utilizing what’s well known as the very best technique to detect asbestos fibers, generally known as transmission electron microscopy.

Plaintiffs’ legal professionals are already homing in on inconsistencies between J&J’s statements and different proof concerning its talc, and they’re planning to depose Gorsky in coming weeks.

“There is no flexibility in what they’re saying,” mentioned Leigh O’Dell, one of many lead legal professionals representing plaintiffs in hundreds of lawsuits towards J&J consolidated in a New Jersey federal court docket. “Taking these statements on behalf of the company and pointing out to juries and judges the misrepresentations contained in those statements — I think you’re going to see that in every case going forward, whether it’s an ovarian cancer case or a mesothelioma case.”

One of J&J’s current tweets criticized plaintiffs’ legal professionals: “Far from a new theory or insight, plaintiffs’ lawyers have resurrected a disproven argument about asbestos in our talc that dates to the 1970s.”

The Reuters investigation discovered that checks by J&J’s personal contract labs and others periodically discovered small quantities of asbestos in talc from mines that provided the mineral for Baby Powder as lately because the early 2000s.

Some J&J tweets and newspaper advertisements have adopted a question-and-answer format. “What about the allegation you withheld safety information?” the corporate mentioned in a full-page advert in USA Today the day after Christmas.

“It is false,” the company said. “All safety concerns are taken seriously, and we share all relevant information with regulators.”

Some Twitter customers have responded to J&J’s tweets with reward and assist. Others have referenced their family members’ longtime use of J&J talc merchandise and subsequent deaths from ovarian most cancers. “We’re very sorry to hear this,” J&J responded to a number of Twitter customers, expressing a want to talk with them and providing a cellphone quantity to name.

In response to a different current tweet by which J&J mentioned its talc would not include asbestos, one Twitter consumer requested: “Did it USED to?”

“No,” J&J responded. “For decades, J&J’s baby powder has repeatedly been tested for asbestos and found not to contain asbestos.”