Johnson & Johnson has tentatively agreed to settle a sweeping probe over its marketing of talcum-based baby powder for about $700 million, a company executive told The Wall Street Journal.
Forty-two states and Washington, D.C., launched an investigation into whether the drugmaker failed to warn consumers about possible cancer risks tied to the product. The tentative deal with states' attorney general offices, first reported by Bloomberg earlier this month, would avoid any lawsuits regarding the product's marketing.
The move is an "important step" for the drugmaker as it looks to "reasonably put the matter behind us," J&J CFO Joseph Wolk told the Journal Jan. 23.
The company still faces personal-injury lawsuits filed by more than 52,000 plaintiffs nationwide, alleging that use of the now-discontinued baby powder caused them to develop cancer. Johnson & Johnson has sought to resolve these cases by offloading them to its subsidiary, LTL Management, and having the unit file for bankruptcy. Last February, an appeals court rejected the bankruptcy plan.
Erik Haas, J&J's worldwide vice president of litigation, said the drugmaker will ask the Supreme Court to overturn this ruling in a Jan. 23 earnings call.
"As was leaked last week, that progress includes an agreement in principle that the company reached with a consortium of 43 state attorneys general to resolve their talc claim," he said. "We will continue to address the claims of those who do not want to participate in our contemplated consensual bankruptcy resolution through litigation or settlement."