Johnson & Johnson proposes to pay nearly $9 bn to settle lawsuits in US
10 Apr 2023
Pharmaceutical giant Johnson & Johnson has proposed to pay $8.9 billion to settle thousands of lawsuits across North America that claim damages for cancer caused by using its baby powder and other talc-based products.
The New Jersey-based company said the proposed settlement, which still needs the approval of a bankruptcy court, "will equitably and efficiently resolve all claims arising from cosmetic talc litigation."
If approved by the court and a majority of the plaintiffs, the $8.9 billion payout would be one of the largest product liability settlements ever in the United States, ranking alongside those entered into by tobacco companies and, more recently, opioid manufacturers.
The company had previously proposed a $2 billion settlement of to resolve the legal battles.
The lawsuits had alleged that users of J&J’s talcum powder meant for feminine hygiene have developed ovarian cancer, or mesothelioma, cancer that strikes the lungs and other organs.
In 2020, the company halted sales of talc-based baby powder in the US due to "misinformation" that had affected demand for the product. Last year, it announced plans to end sales globally.
The company has been trying to resolve the lawsuits in bankruptcy court since 2021, after creating a subsidiary responsible for the claims.
Erik Haas, worldwide vice president of litigation for Johnson & Johnson, said, that the company still believes the claims are "specious" and that they "lack scientific merit." However, the company is willing to settle to conclude legal battles because it could take decades in court and be expensive, he added.
The company said the newly proposed settlement is not "an admission of wrongdoing, nor an indication that the company has changed its longstanding position that its talcum powder products are safe."
"Nonetheless, resolving this matter as quickly and efficiently as possible is in the best interests of the company and all stakeholders," J&J said.
According to Haas, the settlement "allows claimants to be compensated in a timely manner, and enables the company to remain focused on our commitment to profoundly and positively impact health for humanity."
"Resolving this matter through the proposed reorganisation plan is both more equitable and more efficient, allows claimants to be compensated in a timely manner, and enables the company to remain focused on our commitment to profoundly and positively impact health for humanity," Haas said.
The company has won a majority of the talc lawsuits against it, but some significant losses, including one in which 22 women were awarded a judgment of over $2 billion.
The baby powder by J&J has been in the market for almost 130 years, claiming to prevent nappy rash. The version of the product that is currently in stores contains cornstarch.