Johnson & Johnson reportedly reaches US$700 million settlement with several US states in talc powder probe

09 Jan 2024 --- Johnson & Johnson (J&J) is reportedly ready to settle a probe launched by over 40 US states about its talc-based baby powder marketing.

Bloomberg says J&J tentatively agreed to pay US$700 million to resolve allegations it did not warn consumers about possible health risks associated with its baby powder. 

The settlement would prevent further potential lawsuits alleging the health care giant hid any link between the talc in its powder and various cancers.

Personal Care Insights requested comments from Attorney General offices in Texas and Florida after reports these two states were leading the investigation and settlement discussions. They have apparently agreed to the $700 million figure but are said to be working out specific terms with the New Jersey-based company.

Long-standing battle
The American multinational has been involved in litigation related to its baby powder for years. The latest settlement is reportedly part of the company’s efforts to reign in the growing number of lawsuits. 

Courts previously rejected two attempts by J&J to use the bankruptcy process to curb potential losses by limiting its exposure to litigation. 

Mississippi ris eportedly seeking compensation for the millions of baby powder bottles sold since 1974 without a cancer warning.This latest figure of US$700 million would be significantly larger than the US$400 million J&J set aside last year for the claims brought forth by US states. That was part of the company’s more comprehensive offer of US$9 billion to settle all claims.    

Analysts tell us earlier monetary offers by J&J to settle the suits were not strong enough and would necessitate the company coming forward with a much more significant amount. 

State of Mississippi and New Mexico
We also reached out to the Attorney General offices in Mississippi and New Mexico to seek clarification about their lawsuits targeting J&J amid reports the latest tentative deal reached with J&J does not include these two states, which are trying to get more money from the health care products manufacturer.   

According to court filings, Mississippi reportedly seeks compensation for the millions of baby powder bottles sold in the state since 1974 without a cancer warning.

That alone could be worth US$6 billion in damages if a judge orders J&J to pay a fine of US$ 1,000 per bottle under the state’s law.

50,00 lawsuits and counting
The company maintains its talc-based products do not cause cancer and has won many court cases while having others dismissed before trial. Still, there are more than 50,000 lawsuits, with reports of multiple new ones every month. 

Analysts tell us it is debatable whether US$700 million would be enough to settle this newest litigation round and that J&J’s lawyers are undoubtedly looking at several options to control the company’s losses.

By Anita Sharma