Johnson & Johnson has announced its plan to increase the amount it has set aside to cover lawsuits related to its talc-based baby powder by nearly four times. The company is allocating USD 8.9 billion to pay for potential liability, up from the USD 2 billion it had previously earmarked in October 2021. This amount will be paid over the next 25 years through its subsidiary, LTL Management, pending court approval.
Over 60,000 parties have filed lawsuits alleging harm from J&J talcum powder, which the company vehemently denies. Although J&J is not admitting any wrongdoing, it acknowledges that fighting the lawsuits in court would be time-consuming and expensive. Erik Haas, J&J’s worldwide vice president of litigation, stated that the claims “are specious and lack scientific merit.”
The lawsuits claimed that J&J’s talcum powder caused ovarian cancer and mesothelioma, a cancer that affects the lungs and other organs. These allegations led to a decline in the company’s sales of baby powder and prompted it to stop selling its talc-based products in 2020. Last year, J&J announced plans to discontinue sales of the product worldwide.
Following the announcement of the increased liability provision, J&J’s stock rose by 3% in after-hours trading.
